Nissan to use high-tech production system amid pressure to cut costs

2017 Nissan GT-R NISMO

Nissan Motor is bringing a new, higher-tech production system worldwide to try to increase efficiency as it looks to reverse a slide in profitability.

The upgraded equipment and other technologies, which consist of increased automation for applying sealant and installing powertrains, will be presented starting with Nissan’s Tochigi factory from 2020 at a cost of 33 billion yen ($304 million), the company stated on Thursday.

The automaker refused to tell which other plants would be upgraded or the whole budget for the project.

Nissan has seen profit decline this fiscal year, hit by a stronger yen and declining sales in its major markets of China and the United States, forcing it to cut its forecast for operating income to an 11-year low.

A new executive team is due to take over from December 1, headed by 53-year-old Makoto Uchida, who operated Nissan’s China business. The change comes a year after the removal of former chairman Carlos Ghosn, who is awaiting trial in Japan on charges of financial misbehavior, which he rejects.

Nissan is implementing a worldwide recovery plan under which it will cut almost one-tenth of its workforce and slash global vehicle production by 10% through 2023 to rein in expenses which the company states ballooned under Ghosn.

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