Japan’s automaker Nissan is offering voluntary separation packages to employees at three of its facilities in the US as part of a global cost-cutting initiative.

It will offer the buyouts at its vehicle assembly plants in Smyrna, Tennessee, and Canton, Mississippi, as well as an engine plant in Decherd, Tennessee, reported Reuters, citing a company spokesperson.

It will also slash shifts at these facilities.

This strategy is aimed at reducing the company’s global costs by $2.6bn.

Starting in April 2025, the Smyrna plant is expected to reduce one of two shifts producing the Rogue sports utility vehicle, and in September, the Canton plant will do the same for the Altima sedan.

Nissan also manufactures Rogues vehicle at its Kyushu factory in Japan.

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In July 2024, Reuters reported that the firm reduced output at the Kyushu facility by a third as a result of reduced demand in the US.

At the Decherd plant in Tennessee, which produces engines, shift adjustments will occur gradually. Some shifts will be maintained, while others will be reduced by one shift, reported Associated Press.

Nissan’s spokesperson has not disclosed the number of US workers expected to accept the buyout offer.

Nikkei news outlet reported that the company could potentially cut up to around 1,500 jobs with the move.

The spokesperson said that the company is not planning for involuntary layoffs.

As of the end of 2024, Nissan had over 11,700 employees at the three US plants.

In November last year, Nissan announced a plan to eliminate 9,000 jobs globally and reduce capacity across its 25 vehicle production lines, following a sales downturn in key markets such as China and North America.

A month later after this announcement, Nissan and Honda Motor began discussions on a potential merger, which could result in the creation of what it claims to be the world’s third-largest auto group with an annual production of 7.4 million vehicles.

Last week, Bloomberg reported that Nissan was planning to halt the production of its AD compact van in November this year to reduce excess production capacity.