Being in dire financial straights as it is, no one expected Nissan’s revised restructuring plan, due out next month, to call for Global Domination In All Fields. Ghosn is ghone. Regardless, after the rapid expansion and sudden contraction seen over the past decade, it’s still a bit jarring to hear that Nissan’s plan reportedly calls for a significant cut to its sales volume and manufacturing capacity.
More so than previously planned, it seems.
We hear this by way of Reuters, whose sources have dropped details on the plan all week long. The latest tidbit is that Nissan will chop 1 million vehicles from its global sales target — a target said to still be in flux — while planning for a significantly smaller global footprint in the coming years.
The two sources who spoke to Reuters say Nissan anticipates annual global sales climbing to 5 million by 2023, the end date for the restructuring plan. In comparison, Nissan sold 5.18 million vehicles last year and 5.65 million in 2019. A year before that, Nissan sold 5.77 million.
As the automaker’s fortunes declined even before the pandemic hit, sales projections had taken a haircut. When piloted by Carlos Ghosn, Nissan was shooting for 8 million annual sales. Later, former CEO Hiroto Saikawa, who left the company late last year, projected a global volume of 6 million for the 2023 target year.
The company’s financial picture has failed to improve, and COVID-19 — with the costs and sales losses incurred by it — only make matters worse. It seems Nissan’s plan to stabilize its operation calls for a streamlined lineup of specific models in key markets, rather than a global presence in all segments.
Notably, the sources claim Nissan’s plan calls for a “large reduction to manufacturing capacity,” pointing to a possible retreat from some markets and the selloff of plants. Steep cuts to Nissan’s workforce were already on the table when the pandemic hit. Last year, the automaker said it expected to cull 12,500 positions globally, with production capacity and the number of models produced expected to fall 10 percent by 2022. A year later, it looks like those figures might see a boost.
[Image: rmcarvalhobsb/Shutterstock]
Canton assembly plant on the chopping block. Possible sale to Hyundai/Kia.
This was on the table before Pandemic.
Entire commercial vehicle program ended at Nissan. Discussion to continue the Titan platform with Hyundai building them and selling to Nissan. Frontier assembly moved to Mexico.
I am assuming that if Hyundai builds Titans they will also sell them with “badge engineering”.
I also think Hyundai could move them in bigger numbers than Nissan.
Is this based on something you’ve seen/heard or is it pure conjecture on your part?
Doubt H/K is looking to expand production capacity when they already have excess capacity (esp. in China).
They both are developing proper pick-ups and supposedly BoF SUVs to be built at a new plant in SE Asia, but if they want the pick-ups to be available here would have to also tool a plan somewhere in NA (Kia’s Mexico plant has spare production capacity).
But I guess if they are looking for production capacity for both pick-ups, as well as the SUVs, then maybe picking up an operating plant would make sense, but that would be a risky move during a time when automakers are bleeding cash, on top of the massive amounts of expenditure already being made for electrification, autonomous driving systems, etc.
Discussion of this contingency plan occurred in mid to late February of this year. In Japan. It is not conjecture and the information is thirdhand so I don’t know how widely it’s spread.
I don’t know how many lines are at Canton. It’s a major plant with 1/2 a million vehicle capacity and over 6K workforce.
This is very interesting information, thank you for sharing.
Thanks for the info.
If Hyundai was interested in doing this, must have meant that Hyundai had plans to manufacture their (and likely Kia’s) upcoming BoF pick-up and maybe their new SUV as well in the US.
But as automakers are all calling on their lines of credit and looking to conserve cash, wouldn’t be surprised if nothing comes out of this.
But who knows? Maybe Hyundai will see this as an opportunity to turn the screws on Nissan to acquire the plant at a lower price (not exactly a good time to expand production capacity).
Cut all models built in the U.S. The only quality vehicles Nissan/Infiniti make are built in japan.
Naa…those Asian ones are poor quality also. Nissan just builds uncompetitive garbage…the assembly location isn’t relevant.
I wonder how much worse it would be would US workforce organize/join UAW.
Inside looking out
A unionized Nissan would have been trying to build margins, not volume. They would have put more money towards the: Frontier, Xterra, Armada, Pathfinder, Z, GTR & the Infiniti brand. The partnership with Mercedes wouldn’t have fallen apart.
They wouldn’t have bailed out Mitsubishi.
Under US accounting rules, Nissan would have been bankrupt in the late 90s.
Are we moving to brand death watch here?
TTAC could do one for the sake of whimsy but not a chance Japan allows Nissan to go down.
ajla
Toyota, Honda, Subaru, Mazda, Suzuki & Isuzu say “Let Nissan Burn”
Not a chance Japan allows Nissan to go down. Frame this comment for the future and if it comes to that I’ll see you then.
I completely agree but if we’re looking at a true global SHTF event, JP gov’t may not be able too.
I think things are going to get pretty bad, but I don’t think things are going to get Japan allows Nissan (or any of their multinational corps) to die bad.
I agree, looks like its Depression 2.0 and then in a couple of years we’ll have WWII again. I wonder who will play the key roles… I suppose Merkel is Hitler, Macron can play Mussolini (as he is a stooge), maaayybe Boris as Churchill but he’s down at the moment. Obviously Putin is Stalin but I’m not sure who can play Roosevelt though… somehow Trump != Roosevelt to me he feels more like Eisenhower and that’s the wrong period. Maybe this time we can do better than Roosevelt.
Seriously though, I think in theory the BOJ while technically “independent” is backstopped by the Fed. The problem is Japan has been on a murky economic trajectory since the late 80s so even if they pull the money printing and gov’t backed loans to Nissan thing, at some point do other nations say f**k it and stop accepting it as currency for trade?
Although I suppose the Fed can just give them another secret $16 trillion dollars like it did with central banks in 08/09 and up the dollar’s demise just a little bit more. I suspect that’s exactly what would happen… but I wonder if it were to become the straw that broke the camel’s back?
” I’m not sure who can play Roosevelt though”
You forgot about Biden.
I’ve been calling for that since at least last Fall. I’m not making him a saint but I believe Ghosn to a point and that he was set up by the Japanese gov’t. Either whatever he was going to do to try and save Nissan was not acceptable to them OR they blamed him for the state of Nissan and he did not take the hint to go gracefully into that good night when he had the chance.
Infiniti has been shaky for years and Nissan itself was struggling *last* year let alone in the once in a century pandemic/economic crisis. I could seriously see Nissan, or parts of Nissan, bankrupt and possibly liquidated.
If Nissan falters so goes Mitsubishi as well since Nissan took them over in that alliance what two years ago? Probably a bail out of them at the behest of JP gov’t, but now who is bailing Nissan out? Will Mr. Toyoda be getting a call from the prime minister in the coming weeks?
Abe and Macron better get their checkbooks ready.
if the airports are deserted for too long both Nissan and CNN will collapse
and that’s a twofer
thornmark
CNN’s ratings go up every time trump throws a tantrum.
Clearly some companies has go under clearing space for Chinese take over of the global car market.