Nissan Turning Down the Flow From North American Assembly Plants

Steph Willems
by Steph Willems
nissan turning down the flow from north american assembly plants

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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  • Turbo_awd Turbo_awd on May 29, 2018

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

    • TMA1 TMA1 on May 29, 2018

      Q50s are made in Japan, so they should keep stuffing that pipeline.

  • Art Vandelay Art Vandelay on May 29, 2018

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

  • Ollicat I have a Spyder. The belt will last for many years or 60,000-80,000 miles. Not really a worry.
  • Redapple2 Cadillac and racing. Boy those 2 go together dont they? What a joke. Up there with opening a coffee shop in NYC. EvilGM be clowning. Again.
  • Jbltg Rear bench seat does not match the front buckets. What's up?
  • Theflyersfan The two Louisville truck plants are still operating, but not sure for how much longer. I have a couple of friends who work at a manufacturing company in town that makes cooling systems for the trucks built here. And they are on pins and needles wondering if or when they get the call to not go back to work because there are no trucks being made. That's what drives me up the wall with these strikes. The auto workers still get a minimum amount of pay even while striking, but the massive support staff that builds components, staffs temp workers, runs the logistics, etc, ends up with nothing except the bare hope that the state's crippled unemployment system can help them keep afloat. In a city where shipping (UPS central hub and they almost went on strike on August 1) and heavy manufacturing (GE Appliance Park and the Ford plants) keeps tens of thousands of people employed, plus the support companies, any prolonged shutdown is a total disaster for the city as well. UAW members - you're not getting a 38% raise right away. That just doesn't happen. Start a little lower and end this. And then you can fight the good fight against the corner office staff who make millions for being in meetings all day.
  • Dusterdude The "fire them all" is looking a little less unreasonable the longer the union sticks to the totally ridiculous demands ( or maybe the members should fire theit leadership ! )