Japan`s Nissan Motor Co. will pull out of South Korea by December as part of its global downsizing plans after reporting its first loss in 11 years.

The maker of Nissan and luxury brand Infiniti said Thursday it will withdraw from the Korean market after 16 years of operation. After-sale services would be available through 2028.

The move is part of a broad restructuring, it said, adding that plants in Spain and Indonesia would also be shut down.

“Despite efforts to keep our Korean operations, worsening business conditions in Korea and elsewhere have made it hard to achieve sustainable growth in the country,” the company said.

The COVID-19 pandemic has hit Nissan hard. The automaker logged a net loss of 671.2 billion yen ($6.2 billion) for the year ended March 2020, its first annual loss since the 2008 global financial crisis. In the previous year, it posted a net profit of 319.1 billion yen. It sold 4.79 million cars in fiscal 2019, down 13 percent from a year ago.

Japanese auto names have also suffered in Korea since last year following a diplomatic feud between the two neighboring countries.

In July, Tokyo curbed Seoul-bound shipment of key materials used in chips and displays, Korea’s chief export items. The move was widely seen as retaliation of a Korean court ruling that ordered Japanese companies to compensate Korean wartime forced laborers during Japan’s 1910-1945 colonial rule.

The event sparked nationalist fervor among many Koreans, who vented their outrage through a mass boycott of Japanese products.

Nissan sales in Korea tumbled 41 percent and Infiniti 79 percent in the January-April 2020 period compared with a year earlier. The combined sales of five Japanese auto brands in Korea, including Toyota, Lexus and Honda Motor, plunged 59 percent in the same period.

By Park Yun-gu and Kim Hyo-jin

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