The company will focus on profitability over market share.
Japan’s number two automaker is showing signs of slowing in North America. For the first time in nearly eight years, Nissan saw it sales decline in the region in 2017. Both the Rogue and the Altima dropped by 9.2 percent (thankfully, the latter has an all-new version on the way), and sales in the U.S. saw an increase of just one percent, totaling 1,440,049.
Now the automaker is looking to make some serious production cuts in an effort to combat the dramatic sales drop. Nissan will reportedly slash up to 20 percent of its production in North America – including the U.S. and Mexico – before the end of the year, according to Japan’s Nikkei business daily.
Two assembly plants in the U.S., and three in Mexico have already fallen victim to cuts. Though no employees have been let go, says the report, schedules have been reworked to include a minimum of two added days off per week. Production lines remain active, but could see output drop anywhere from 10 to 20 percent by the summer, before final cuts in autumn.
Nissan will instead focus its efforts on improving profitability in North America instead of market share. The Japanese automaker will now place more of an emphasis on expansion to markets like China, the world’s largest. Its Infiniti luxury brand already calls Hong Kong home.
All told, the U.S. accounted for 28 percent of Nissan’s total sales. And though the U.S. exceeded expectations for 2017 by a slim margin, these new cuts could drop the region’s total market share to around three percent for 2018. Already sales in 2018 have slipped to 6.5-percent below average for the automaker stateside through the first give months of the year.