20-05-2025
- Automotive
- Yomiuri Shimbun
Nissan's Closure Plan Casting Shadows on Local Communities; Concerns Voiced over Impact on Local Employment, Economy
The Yomiuri Shimbun
Nissan Motor Co.'s Oppama plant in Yokosuka, Kanagawa Prefecture
Nissan Motor Co.'s envisaged plan to close two plants in Kanagawa Prefecture is casting shadows on the local communities.
The company is currently making arrangement to shut down its flagship Oppama plant in Yokosuka and the Shonan plant of its subsidiary Nissan Shatai Co. in Hiratsuka, both in the prefecture.
Local governments and businesses have expressed concerns over the adverse impact that the closures would have on the areas.
Another blow
'If the plants are closed, it will significantly impact employment and the economy. People in the prefecture are concerned,' said Kanagawa Gov. Yuji Kuroiwa in an emergency meeting with senior prefectural government officials on Monday. He instructed the officials to gather information quickly.
Of Nissan's 13,000 or so business partners, Kanagawa Prefecture is home to more than 1,700, according to Tokyo Shoko Research, Ltd. If the Kanagawa plants are shut down, an impact on the local economy will be inevitable.
'Dark clouds are already gathering over the entire automobile industry due to the U.S. government's high tariff policy,' said a man in his 20s working at a Nissan subcontractor developing in-vehicle systems. 'The plant closures would just be another blow to the industry.'
The closures would also hit stores in local shopping streets.
'Oppama has developed with Nissan, so I truly hope that the plant here will not be closed,' said the manager of Hokaben Nihontei Oppama-ten, a bento store near the plant. On weekdays, the store sells about 100 bento boxes at lunchtime, and most of them are bought by plant employees or people visiting the plant on business. 'If the plant is closed, we'll certainly be affected,' the manager added.
Oppama Shoseikai, a shopping area around Oppama Station, which is on the Keikyu Line and near the plant, is lined with restaurants and food shops frequented by plant employees. 'We have yet to recover from the coronavirus pandemic,' said Toshimi Oda, 68, director of the shopping street's union. 'We feel like salt is being rubbed into our wounds.'
The Yomiuri Shimbun
Production declines
Nissan announced on May 13 that it will shut down seven plants worldwide, including in Japan, by fiscal 2027. It's a 'painful' and 'sad' decision to make, said Nissan President Ivan Espinosa in a news conference about the plan. At that point, the company had not begun to make full-scale arrangements with the local governments concerned or the company's labor union, according to sources.
The two plants were apparently picked to be closed due to their aging production facilities and declining operating rates. The Oppama plant, which has an annual production capacity of 240,000 cars, currently manufactures the Note, a compact car, and its derivative models. Up until fiscal 2019, it produced five models, including the Leaf, an EV model. The Shonan plant, which produces commercial vans, currently manufactures only about 20,000 units, despite an annual production capacity of 150,000 units.
Nissan has five vehicle production plants in Japan. In addition to the Oppama and Shonan plants, it has one plant in Tochigi Prefecture and two others in Fukuoka Prefecture.
An executive of the company said the two Fukuoka plants would be enough to meet demand in Japan at a meeting to discuss how to overhaul the company's production system, according to sources close to the company. The Tochigi plant was reportedly excluded from restructuring plans because it has a test course, which is necessary to develop vehicles, and because the company has invested about ¥33 billion to turn the plant into an EV production center.
During the 1990s, Nissan produced more than 2 million cars in Japan. In fiscal 2024, however, the number slipped to the 640,000 level. The proportion of Japan-produced cars in the firm's global production figures dropped from over 70% to about 20% due to the relocation of its production centers to the United States, the automaker's main market, among other factors. In addition, the operating rates of all domestic plants are about 50% due to slumping domestic sales.
Nissan's performance is also poor. The company forecasts an operating loss of about ¥200 billion for the quarter through June. It is also saddled with debts totaling about ¥700 billion, including corporate bonds that will reach maturity within the current fiscal year.
