Japanese automaker Nissan announced Monday it would cut 1,680 jobs in Barcelona, northeastern Spain, as the economic downturn in Europe weakened demand for its larger 4X4 and trucks.
“Several factors have led to this decision,” a company statement said, such as “the global economic crisis which has caused a dramatic decline in the total industry volume.”
Nissan currently employs 6,100 people in Spain.
The statement also singled out “the continuing pressure on CO2 emission standards and increasing fuel prices” which have led to a drop in demand for the 4X4 and truck vehicles that are produced at the auto maker's Barcelona factory.
The announcement, one of the biggest in the industry in recent weeks, is just the latest bit of bad news for European auto workers.
Swedish automaker Volvo, owned by Ford, has cut 6,000 jobs since the start of 2008 — a reduction of 25 percent in its workforce.
France's Renault expects to cut 1,000 jobs in its factory in Sandouville, northwestern France, owing to poor sales of the Laguna sedan. Its national rival PSA, which owns the Peugeot and Citroen brands, will cancel its night shifts, affecting 300 interim workers.
Germany's BMW will temporarily shut several factories in Germany this month. Opel, a subsidiary of General Motors (GM), is also cutting production.
The Austrian contract manufacturer Magna-Steyr said it would temporarily move around 2,600 employees at its factory in Graz on to part-time contracts from the start of November.
Customers are finding it more difficult to access to credit, placing further strain on the automotive market which was already struggling from high oil prices.
The European Automobile Manufacturers Association (ACEA) said at the start of October that it was “deeply concerned” by the loss of consumer confidence and the decline in economic growth.
It called on European lawmakers to provide a low-interest loan of 40 billion euros (29.5 billion dollars) to help the industry see out the tough economic conditions. The request was rejected by the European Commission.
ACEA says sales of new cars in Europe fell 7.3 percent in July and 15.6 percent in August, compared with the same two months last year.
In some countries, the situation is even worse. The so-called “Detroit 3” (US automakers GM, Ford and Chrysler) recently asked for a 25 billion dollar loan from the government.
Credit rating agency Standard & Poor's says GM and Ford could still struggle in 2009. Both may be at risk from bankruptcy if they fail to raise more cash.
But some segments appear to be immune from the current financial turmoil. Luxury brands such as Ferrari still see high demand for their products. The Italian automaker's new California sports car is already sold out until 2011.
