LOS ANGELES - How thin can Nissan get?
In yet another reduction to its U.S. work force, Nissan North America Inc. said it is cutting about 1,000 employees from its sales, finance and manufacturing arms. It also will take corporate autonomy from its Smyrna, Tenn., factory and make it part of Nissan North America, effective April 1.
Last week's announcement covers some steps already taken. Last month, Nissan eliminated 300 jobs by farming out its information technology operations to IBM. Since April, another 250 positions have been lost through attrition. So 450 cuts still have to be made.
The cuts come just as Nissan prepares for an onslaught of product launches over the next two model years. But Nissan North America President Nobuo Araki insists the reduced headcount will not hurt the introductions.
The moves are North America's primary contribution to the Nissan Revival Plan, announced in October. General and administrative expenses worldwide will be trimmed by 20 percent, or about $1.9 billion.
The other 450 North America jobs will be cut by April 2001, mostly in redundant back-shop departments. Each unit in North America has had its own human resources, legal, finance and administration departments. Those will be combined.
The cuts aren't just in the trenches; overlapping vice presidents will be ushered into retirement or reassigned. The ranks of Nissan's Japanese staff here will be slashed as well, Araki said.
Nissan also is merging two regional offices. Infiniti's East region will be housed in the Nissan Northeast regional offices, while Nissan Southwest operations will be housed in the main headquarters building in Gardena, Calif.
'Because we had so many entities, we had a lack of efficiencies,' said Araki, who made the plan. He says attrition may take care of many of the remaining cuts.
Araki insisted the cuts will not affect service to the dealer body.
Although Nissan North America will absorb the manufacturing arm, it will not merge with its captive finance arm or its Mexican operations.
'For decision making and policy making, we basically are under one umbrella,' Araki said. 'But the legal and IRS tax issues mean we cannot merge into one company.'