Tightening Financial Conditions And Rising Interest Rates Force Dell To Lay Off 6,600 Workers: Renault Sa And Nissan Motor Company Announce Restructuring Of Alliance

In the latest BNN breaking news, Dell announced plans to lay off 6,600 jobs. It is the latest tech company to join other companies like Google, Salesforce, Amazon, etc. to retrench 5% of its employees, forced to do so because of tightening financial conditions and surging interest rates.

Implemented cost-cutting measures

According to recently available information, the employee count at Dell in early 2022 was 133,000. In a memo to its employees on Monday, Dell Co-Chief Operating Officer Jeff Clarke stated that the company is forced to reduce its workforce due to an uncertain future. The company had 165,000 employees in early 2020 before spinning off its stake in VMWare Inc., a cloud software company.

The company already employed cost-saving measures like limiting unnecessary travel, halting hiring, and lowering expenses on outside services. Jeff said these measures are not enough because of tightening marketing conditions. 

Jeff further claimed that the company is reorganizing its engineering, product development, customer support, and sales teams. Previously, the company went through difficult economic conditions and emerged as the winner. Similarly, the company will rebound when market conditions are favorable.

The biggest employer in the US, Dell, is trimming its workforce like other companies that respond to increased interest rates, rampant inflation, and the normalization of trends post-pandemic. Various companies like Amazon, Microsoft, and Google have laid off several thousand employees. Other category companies such as Dow Inc., 3M Co., and FedEx Corp. have made similar announcements in the recent period.

Nissan Motor Company And Renault Have Decided To Restructure Their Alliance To Gain More Autonomy

In the latest breaking news, Renault SA and Nissan Motor Co. announced plans to restructure their decade-old partnership on Monday. Following this restructuring, each company will enjoy more independence after struggling with tensions for several years.

Importance to changing trends in the auto industry

Following the restructuring effort, Renault will lower its stake in Nissan to 15% from the existing 43%. In the new partnerships, they will focus on software, EV technology, and batteries. Nissan will invest in Renault’s software business and electric vehicles. Both partners will also work on joint projects in Latin America, India, and Europe. In a communiqué released on Monday, both companies said they would sign the definitive agreements by the end of March 2023. 

According to the 1999 partnership agreement, Renault owns more than a third of the struggling company Nissan. Renault dispatched Carlos Ghosn, its rising executive, to head a rival of Nissan. He headed both firms and settled the differences using his skills.

However, with the exit of  Carlos Ghosn in 2018 following his arrest over financial charges in Tokyo, the differences between the automakers were brought into the open. According to a Nissan spokesperson, the management is capable of running the business on its own.

Luca de Meo, Chief Executive of Renault, said the new alliance is straight and expects to operate like an independent company. The head of a Tokyo-based auto consulting firm, Takaki Nakanishi, said both companies would seek new partners. A pioneer in technology, Qualcomm Inc., will acquire a stake in the EV business of Renault. Google will also team up with Renault to develop software defined-vehicles.