Struggling Nissan considers closing two plants in Kanagawa
Ailing carmaker Nissan Motor is considering closing two plants in Kanagawa Prefecture in hopes of shifting away from its costly business structure, which includes excessive production equipment, it was learned Saturday.
The possible closure of the plants in Kanagawa, Nissan's birthplace, seems certain to provoke a backlash from local communities.
The Oppama plant in the city of Yokosuka has an annual production capacity of 240,000 vehicles, including the Note passenger car, while Nissan Shatai's Shonan plant in the city of Hiratsuka has a capacity of 150,000 units and manufactures commercial vans.
Nissan currently has a total of five domestic plants in Kanagawa, Tochigi and Fukuoka Prefectures, with a combined production capacity of 1.2 million units.
However, its domestic production was limited to 640,000 units in fiscal 2024, highlighting the need to improve efficiency promptly by boosting sales and reviewing redundant equipment.
For the year ended this March, Nissan incurred a consolidated net loss of ¥670.8 billion, due to sluggish sales in China and the United States. It is now bracing for the impact of U.S. President Donald Trump's auto and other tariffs.
On Tuesday, the company announced a plan to close seven of its 17 plants worldwide by fiscal 2027. President Ivan Espinosa indicated that the closure plan will affect domestic plants, but declined to specify which ones.
'As you can see, our full-year financial results are a wake-up call,' Espinosa said Tuesday.
'The reality is clear,' he added. 'We have a very high cost structure. To complicate matters further, the global market environment is volatile and unpredictable, making planning and investment increasingly challenging.'
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