Nissan plans $2.8 billion in cuts, dumps Datsun brand as it restructures

TOKYO — Nissan Motor Co plans to cut $2.8 billion in annual fixed costs as part of its restructuring plan, Bloomberg News reported on Wednesday, as it braces for a drop in sales that could complicate its recovery from years of poor profitability.

Following a three-year spell of tumbling profits, Nissan will announce its restructuring plan on May 28, its latest attempt to slash costs after a strategy of aggressive selling to chase market share has pummeled its bottom line.

Phasing out Nissan's lower-cost Datsun brand, which has been struggling in Asian and Russian markets, and closing down an additional vehicle production line are also among measures being considered, the report said.

The Japanese automaker plans to slash fixed costs in areas that include marketing and research, Bloomberg reported, citing unnamed sources. It added that the company's board has not yet reviewed the plans.

Known internally as the "performance recovery plan," the proposed steps mark a sharp break with Nissan's strategy under ousted leader Carlos Ghosn (shown above), who pursued ambitious vehicle sales targets in the United States and other major markets.

The plan is the Yokohama-based automaker's latest attempt to pull itself out of crisis after Ghosn was arrested for financial misconduct — charges he denies. The scandal has further strained an already dysfunctional alliance with Renault SA and thrown Nissan into disarray as it finds itself on course to book its lowest operating profit in 11 years.