The Guardian March 15, 2000


Jobs "downsizing", corporate "upsizing"

Nissan's "revival" plan in Japan is running into opposition from its 
workforce who are opposed to the plan to transfer employers, the 
centrepiece of a plan to cut 21,000 jobs. The plan was made by Renault's 
chief operations officer, Carlos Ghosn, who was sent by the Renault to 
Japan following the French company's takeover of Nissan last October. 

It has become clear that the plan is not for Nissan's "revival" but 
represents the French automaker's attempt to turn Nissan into a de facto 
subcontractor of Renault.

The French Government is Renault's number one stockholder, holding 44 
percent of its shares. Renault obtained 36.8 percent of Nissan Motor shares 
and 22.5 percent of Nissan Diesel shares. 

Carlos Ghosn and other Renault executives has taken seats on the Nissan 
board.

In Japan this was described as a "tie up between Nissan and Renault" 
whereas in Europe it was reported as "Renault's acquisition of Nissan".

The main points of the restructuring are:

* A 30 percent cut in production capacity through the closure of five 
plants, cutting 21,000 workers and creating a structure for a "leaner 
production system";

* A 50 percent reduction of the 1,145 parts and material suppliers down to 
600 and cutting the number of equipment and service suppliers from 6,900 to 
3,400;

* A streamlining of the sales network by closing at least 20 percent of the 
direct sales outlets;

* The selling of sections related to fork-lift vehicles, aerospace 
technology and textile machinery parts; 

* The sale of shares in companies related to cellular phones and the sale 
of shares of the 1,394 companies in which Nissan has invested.

Cuts to production

A major characteristic of the plan is a substantial reduction of Nissan's 
production capacity and increased production of Renault models at Nissan 
facilities. The plan says that Nissan's annual production capacity of 2 
million should be reduced to 1.65 million.

Nissan management had told the company's central labour management council 
that "in 1999 Nissan sold 800,000 units in Japan. Our production capacity 
is sufficient to manufacture extra vehicles for export even when domestic 
sales increase to the million level."

Renault has decided to shift car assembly and sales of Renault cars from 
its plants in Europe to Nissan's plant in Mexico in 2001. 

The Nissan News reported in January: "Renault will be able to re-
enter the Mexican market in the most efficient and prompt way. It will be 
able to establish Renault brands in Mexico and increase its presence in 
Central and South America as well as the Caribbean region."

Renault also plans to develop the production and sale of its cars at Nissan 
plants in Southeast Asia and South Africa.

These developments show that Nissan's "revival plan" is a plan to reduce 
Nissan's production capacity and use the company's sales outlets to further 
Renault's global strategy.

Using Japanese know-how

Nissan's research and development section will be the only area where staff 
will be increased under the plan. This promises Renault greater profits 
with strengthened R&D to become part of the proposed global centralisation 
of its structure through the integration of its centres in the USA and 
Europe into the Nissan Technical Centre in Japan.

Nissan's reduced production capacity and sales at home will endanger the 
jobs of Japanese workers in related industries such as steel and oil as 
well as the business of small and medium sized enterprises.

The "revival plan" is clearly a corporate restructure for Renault at the 
cost of Nissan workers' jobs and the Japanese economy.

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Acknowledgements: Japan Press Weekly

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