Automotive
Nissan is reportedly contemplating a significant shift in its production strategy for the fourth-generation Rogue, a preferred crossover model in the USA. Based on Automotive News, the Japanese automaker is considering relocating the production of the Rogue from its Smyrna, Tennessee plant to Kyushu, Japan. This potential move is contingent on Nissan’s ability to scale back purchasing costs, as the corporate anticipates a “significant reduction” in parts pricing when the next-generation Rogue begins production in 2026.
The choice is rooted in Nissan’s request to suppliers to lower the associated fee of parts by a mean of 20%, with some suppliers being asked to implement even steeper cuts of as much as 30%. The motivation behind this move becomes clearer when considering that Nissan can construct the Rogue in Japan for 20% lower than it currently does within the USA.
Despite Nissan USA having already reduced internal manufacturing costs by 18%, it seems that further cost reductions are mandatory. The corporate has conveyed to suppliers that if the specified cost proximity to Japan can’t be achieved, production of the Rogue could be shifted to Japan.
This potential shift has significant implications for Nissan’s operations in the USA, particularly on the Smyrna plant. The Smyrna facility, which employs around 6,700 employees, is crucial for Nissan’s U.S. manufacturing, producing various models including the all-electric Leaf, Pathfinder, Murano, and Infiniti QX60. Notably, the Rogue constitutes a considerable 40% of the factory’s output, making it a linchpin for the plant’s viability.
The impact could possibly be exacerbated by the cessation of Leaf production on the Smyrna plant in 2025, with its alternative slated to be manufactured in Japan. If the Rogue production is indeed moved to Japan, it could pose challenges for the Smyrna plant’s sustainability.
To deal with space constraints on the Japan facility, Nissan is reportedly considering transferring among the existing Rogue production to China, as suggested by sources to Automotive News. This move, if executed, would represent a big reconfiguration of Nissan’s global production footprint.
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This Article First Appeared At www.automotiveaddicts.com
