Nissan and Honda on Tuesday said they had furloughed almost 10,000 workers each at their United States operations because the coronavirus pandemic slashes demand for cars in the country.
Nikkei reported on Tuesday, Apr. 7, both Japanese automakers had to take more drastic measures as world economies remain at a standstill amid the coronavirus pandemic.
Nissan's factory workers in the U.S., Europe affected
While Nissan initially decided to close until Apr. 6, with no end in sight for the outbreak, the Japanese carmaker has now extended the shutdown to the end of April.
Almost all of Nissan's factory workers in Tennessee and Mississippi plants might be affected by the layoffs, the report added.
The affected worker will not be paid by Nissan after being laid off, even though it seems that the employer will rehire them once the plant restarts working. The people will draw unemployment advantages until then.
A Nissan spokesperson explained to CNET's Roadshow that the organization is imposing temporary layoffs to help control the company where the activity is reduced. "Affected personnel could be eligible to apply for government support such as enhanced unemployment benefits," the spokesperson added.
Nissan additionally plans to lay off most of its 6,000 personnel at its U.K. Plant and around 3,000 people at a manufacturing facility in Barcelona, Spain.
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Honda promises to pay full wages for its workers until Sunday
Since the start of Honda's work stoppage, the automaker has paid full wages for its almost 20,000 workers at plants in Alabama, Indiana, and Ohio. Of whom, more than 10,000 can be placed on leave until the end of April. However, a spokesman for Honda told The New York Post the Japanese automaker would assure salaries through Sunday, Apr. 12.
Honda, which constructed 1.2 million cars in the U.S. in 2019, suspended production at its factories there on Mar. 23. The corporation, according to Nikkei, will instruct the workers to apply for unemployment advantages from their local governments beginning Monday, Apr. 13.
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Other companies defend their groups from the economic slowdown
While Toyota suspended its U.S. and Canadian production since Apr. 17, a Toyota spokesman told The New York Post it has not laid off its U.S. employees.
General Motors decided to postpone the payment of 20% of salaries for its about 69,000 personnel in the U.S. and overseas, CNBC said.
CNBC also reported Fiat Chrysler Automobiles plans to lessen salaries by as much as 20% for three months. However, the agency intends to pay the withheld portion back in one year.
Numerous automakers started to shutter their manufacturing plants since coronavirus spread across the U.S., with the ultimate goal of protecting its employees and slowing the spread of the virus. All the while, new car sales plunged in March as stay-at-home orders in most U.S. states left nonessential business stores closed, except for service centers.
According to Nikkei, U.S. Unemployment insurance claims totaled approximately 6.64 million as of Mar. 28, doubling from the record 3.3 million reached in the previous week. The claims were especially from those employed in sectors along with restaurants, retail, and hotels, even though packages for jobless benefits by employees in production industries, such as automobiles, have grown.
