Nissan to Cut North America Output as Sales Decline, Nikkei Says

May 29, 2018, 2:34 PM UTC
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Nissan Motor Co. will cut vehicle output in the U.S. and Mexico through this summer to reduce inventories in a cooling market, Nikkei reported Tuesday.

The Japanese carmaker will cut workers’ hours and reduce production by as much as 20 percent at five assembly plants in the two countries, the publication said, without saying where it got the information.

A Nissan spokesman, declining to comment on the company’s production plans, referred to the guidance the Yokohama-based company has given in the past and alluded to statements by executives on declining sales in the region.

Chief Executive Officer Hiroto Saikawa said in May the company is seeking to improve profitability rather than sales growth in the U.S. Predicting sales in the biggest market would drop in the fiscal year through March 2019, he said Nissan will cut inventories at dealers and focus on retail sales. Last year, the carmaker expanded its market share by boosting incentives and increasing fleet sales and shipments to dealers, a strategy that dented its profit margin.

Nissan’s output in the U.S. has been sliding for 10 consecutive months as of March, and the contraction is likely to have extended in April as well, with the company reporting its production data this week. Sales plunged 28 percent in the month.