Japan: Nissan to cut domestic production by 15 pct image

Nissan Motor Co will cut its Japanese production capacity by 15 per cent next month, the Nikkei said on Thursday.

The company will suspend one of two production lines at the Oppama factory south of Tokyo, resulting in its domestic annual output falling to 1.15 million vehicles from 1.35 million, the Nikkei business daily and domestic agencies Jiji Press and Kyodo News said on Thursday.

Shrinking export profits due to the yen’s appreciation as well as a sluggish domestic market have led major Japanese automakers to scale down their production.

It will be the first time Nissan has trimmed its domestic production capacity since the company shut down its plant in Musashimurayama, Tokyo, in 2001 after Carlos Ghosn became its president.
The move will end domestic production of four models including the Note and Tiida hatchbacks, and Tiida Latio sedans, a Nissan spokesman said.

Some of the Oppama plant’s Tiida Latio production will be moved to Thailand, the Nikkei said.

“It is a reduction of our mass production capacity but not a complete reduction of production capacity, as the line could be reactivated again if necessary,” the spokesman said.
“Of course we will keep employees, although for a different role,” he added.

The announcement comes just two days after Toyota said it will gradually cut back its annual domestic production capacity by 400,000 vehicles to 3.2 million units while boosting its overseas output ratio to cope with the yen’s appreciation.

A strong yen the value of overseas earnings for Japanese automakers, making it harder to offer products at cheaper prices abroad. The dollar has traded at 79-yen levels recently, down from about 100 yen in 2009.