Again and again, executives at Japanese car companies warned of a “hollowing out” of the Japanese industry if the yen remains as overvalued as it is. The yen remains unimpressed. Now, the executives start hollowing. A day after rumors of a reduction of domestic capacity at Toyota had hit the wires, Nissan is said to trim domestic output capacity by 15 percent. It will happen as early as next month, The Nikkei [sub] says.
According to the report, Nissan will suspend one of two production lines at its key Oppama plant, reducing Nissan’s annual domestic capacity from 1.35 million units to around 1.15 million units. The Oppama plant has an annual capacity of 430,000 units and makes subcompacts including the Leaf.
Nissan has less than a quarter of its global production in Japan. However, some 60 percent of Nissan’s Japanese production is still exported, exposing the company to currency risks. Nissan is working on changing this. Japanese production of the Tiida will stop, the car will be imported to Japan from Thailand. Nissan already imports the March.