A 2019 Nissan Motor Co. Rogue sport utility vehicle (SUV) sits on the lot at a car dealership in Joliet, Illinois, U.S., on Wednesday, Oct. 2, 2019.
Daniel Acker | Bloomberg | Getty Images
Nissan will cut Japanese production of its top-selling U.S. model, the Rogue SUV, over May-July, said a person familiar with the matter, becoming the latest global automaker to alter manufacturing plans in response to new U.S. import tariffs.
U.S. President Donald Trump’s decision to slap a 25% levy on cars built overseas has upended the global automotive supply chain. Nissan, Japan’s third-largest carmaker, is more exposed than some rivals. The United States is its top market, accounting for more than a quarter of the vehicles it sold last year, with many of those made in Japan or Mexico.
Nissan plans to reduce output of the Rogue by 13,000 vehicles at its plant in Kyushu, southwest Japan, during the three-month period, said the person, declining to be identified because the information is not public. The planned cut is equal to more than a fifth of the 62,000 Rogues sold in the United States in the first three months of this year.
Workers at the Kyushu plant, Nissan’s largest, will work fewer hours from May through July, with production halted on some days, the person said. The plant will continue to operate on two shifts a day, the person added. The automaker will reassess the production situation at a later date depending on the outlook for tariffs, the person said.
On Monday, Trump said he was considering modifying the auto levy because automakers “need a little bit of time”.
Nissan said in a statement it was reviewing its production and supply chain operations to identify optimal solutions for efficiency and sustainability. It said it was committed to adapting to market changes while prioritizing workforce and production capabilities.
“Our approach will be thoughtful and deliberate as we navigate both immediate and long-term effects,” it said.
Backtrack
The Rogue was Nissan’s best-selling model in the U.S. last year, at almost 246,000 vehicles, accounting for more than a quarter of the carmaker’s total U.S. vehicle sales. Nissan also makes Rogue models in Smyrna, Tennessee.
The latest move comes after Nissan this month backtracked on a separate plan to cut output at Smyrna, saying it would maintain two shifts for the Rogue, rather than cutting to one as had been scheduled for April.
Other automakers are also scrambling to navigate the tariffs, which Trump has said will boost U.S. manufacturing and jobs.
Chrysler parent Stellantis has said it was pausing production at one plant in Mexico and one in Canada, impacting five connected U.S. facilities and temporarily laying off 900 U.S. workers.
Honda plans to make its next-generation Civic hybrid in the U.S. state of Indiana, instead of Mexico, to avoid potential tariffs, Reuters has reported.
Even before the tariffs, Nissan had been looking to slash global capacity by 20% as part of a turnaround plan.
New CEO Ivan Espinosa is under pressure to put the automaker on track for recovery, especially in the U.S. where performance has been hit by an ageing line-up and a lack of hybrids. In the financial year that just ended, Nissan cut its profit outlook three times.
