By on May 29, 2018

A larger-than-average new vehicle inventory, compounded by a change in strategy and dismal April sales figures, means fewer vehicles leaving Nissan assembly plants in the United States and Mexico in the foreseeable future.

The automaker plans to cut production by as much as 20 percent in the hopes of firming up its bottom line.

On May 1st, Nissan reported an 88-day supply of new vehicles, well above the industry average of 73 days, Kelley Blue Book reports. That’s double Subaru’s supply and still more than Fiat Chrysler or Ford.

According to Nikkei Asian Review, cuts are already underway at Nissan’s two U.S. assembly plants and three Mexican facilities. No job losses are expected. However, employees might find themselves with an extra day or two spent at home on any given week. By summer, production should decline by 10 to 20 percent, with the cutbacks drawing to a close in the fall.

Last month, the Nissan brand’s U.S. sales fell 29.1 percent, year over year, pushing the automaker’s 2018 volume to a 6.3 percent drop. Infiniti sales fell 17 percent, year over year, with the automaker’s luxury division posting an 8.3 percent year-to-date loss.

For May, Wards Auto predicts a daily selling rate 11.2 percent lower than the same month last year. That’s a larger anticipated sales loss than even Hyundai-Kia.

The month of April corresponds with the beginning of a fiscal year where Nissan plans to get moving on a new corporate strategy of lowered incentives, fewer fleet sales, and suppressed production. Obviously, this stands to bring fewer buyers into Nissan showrooms. While the automaker posted huge sales gains in the years following the recession, maintaining those higher volumes came at a cost — something CEO Hiroto Saikawa isn’t interested in continuing.

Nissan’s new North American chief, Denis Le Vot, has orders from HQ to boost brand value and profitability in the region. Long gone is the automaker’s former passion for growing market share above all other considerations. In the last quarter of 2017, operating profit fell 50 percent.

It’s expected that the throttling back of North American production will take a 3 percent bite out of the brand’s U.S. sales.

On the product side of things, Nisan buyers gain two new models this year: the subcompact, front-drive Kicks crossover (already available in Latin American markets), and the redesigned 2019 Altima sedan bound for the brand’s Canton, Mississippi and Smyrna, Tennessee assembly plants.

[Image: Nissan]

 

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22 Comments on “Nissan Turning Down the Flow From North American Assembly Plants...”


  • avatar
    thornmark

    Once you’ve become the KMart of cars like Nissan has, a tarnished discount brand, there’s no going back.

    The AutoExtremist guy seems to indicate that Nissan has zero brand equity at this point.

    • 0 avatar
      thornmark

      Full here: http://www.autoextremist.com/current/?currentPage=15

      • 0 avatar
        TwoBelugas

        Meh, that guy is also on Ford Death Watch, now I guess he will be twice a busy on his Nissan Death Watch as well. But sure, Kia’s super timely investment into a new RWD sedan in a crossover crazy market is definitely gonna go well, it’s not like there are any much cheaper and established vehicles in the 4000lb weight class.

  • avatar
    87 Morgan

    It appears that Nissan has arrived at the inevitable cross road they laid out for themselves. A sharp curtailment of rental dumping coupled with a tightening in the sub prime lending markets. Seems like we have seen this movie before with other manufactures. Reminds me a lot of Pontiac, though I am not suggesting that Nissan will close up shop.

  • avatar
    RHD

    They could re-introduce Datsun, and consolidate their dealerships into Datsun-Nissan-Infiniti. You could choose from a cheap and economical Datsun, a middle-class Nissan, or an expensive and luxurious Infiniti.
    Each line could have a unique-to-it model or two, as well as entry-level/mid-level/premium versions of the same car for each brand, such as Ford/Lincoln (without Mercury any more) does. There is some advantage to one-stop shopping, with something for everyone.
    I’ll take a customizable 2019 front-engine, rear-drive Datsun 510, please.

  • avatar
    zipper69

    I seem to see more Titans around than any of the sedans or hatches, are they making any dent in the full size pickup market ?

    • 0 avatar
      CKNSLS Sierra SLT

      The Titan XD’s won’t fit in an average garage and the regular Titan doesn’t have enough payload to tow any thing. RAM has had this very problem until this year. (Don’t be fooled at what it is rated to tow-you will hit max payload way before max towing weight).

  • avatar
    turbo_awd

    Is this for Nissans only, or Infiniti models as well? Still hoping to snag a great deal on an over-supplied Q50 :-)

  • avatar
    Art Vandelay

    Must be that chicken tax keeping an import brand down again. Or not

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