In an attempt to improve its bottom line, American auto parts giant Mazda is cutting about 1,000 jobs.
The company says it is doing this in response to rising labor costs and lower sales volumes.
But it’s not the first time Mazda has been hit by falling sales.
The auto parts company last year announced a $1.5 billion writedown to restructure its business.
With a $9 billion debt, Mazda’s stock fell more than 6 per cent in the two weeks following the announcement.
The automaker’s stock was trading below $8.20 by the time of the announcement on Friday.
Mazdas CEO said the company was not expecting the company to experience any sales declines in the next 12 months.
But the company’s woes were evident before the announcement, when the company reported a $2.8 billion loss for the three months ended June 30.
In January, Mazda said its sales and profit numbers for the year would not be released until 2018.
Mazda, which has about 8,500 dealers across the US, has struggled with its struggling auto business.
In its most recent quarterly earnings report, Mazda reported that sales in the US rose 4.2 per cent to $9.9 billion.
That’s below analysts’ expectations, but it was the company most affected by the global recession.
It’s the latest in a string of financial setbacks for the US-based company.
In February, the company announced it was buying back about $1 billion of its stock to help shore up its cash flow.
In March, Mazda sold about 1.3 million vehicles to pay down its debt.
The deal was also financed by a $5.6 billion loan from the federal government.
In August, the automaker reported its second-quarter results for the first half of 2018.
The results were disappointing, with sales down 11 per cent.