Nissan Motor has announced it will cut its capacity by 20% as of March 2024 compared to today including plant closures in Indonesia and Spain as well as “optimizing” its U.S. operations. The firm also noted that global demand in the fiscal year to March 2021 could be down by 15% to 20% year over year.
Panjiva’s analysis of company data shows its global production fell by 62.4% year over year in April, following a 29.6% decline in Q1 and a 9.6% in calendar 2019. Similar, the big seven Japanese automakers experienced global production which fell by 60.4% in April after an 18.0% slide in Q1. Nissan by no means saw the fastest decline in production in April with production linked to Suzuki having dropped by 87.4% while Toyota’s was most resilient with a 51.2% reduction.
Source: Panjiva
The optimization of the firm’s U.S. operations will also have a knock-on effect to its Mexican operations given the advent of new rules of origin under the U.S.-Mexico-Canada Agreement which takes effect from July 1 as discussed in Panjiva’s research of May 27.
Panjiva’s data shows that Nissan exported $4.0 billion of vehicles and $1.05 billion of parts to Mexico in the 12 months to April 30. Unsurprisingly the shipment of parts fell by 70.6% year over year in April due to Nissan’s factory closures while shipments of cars declining by just 29.5% and light truck shipments actually increased by 1.9%.
The latter likely reflects the shipment of vehicles from stock and included models including the NV200 and Navara. The shipments of parts included $755 million axles. Nissan will have to decide whether the steel-based components in particular are shifted to the U.S. within the USMCA rules of origin.
Source: Panjiva