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Nissan Cutting North American Production by 20 Percent

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Nissan has announced plans to cut North American production by 20 percent, citing weak sales and new product lines.

Looks like we’re all well on our way to an Equilibrium-type future of only three different cars to choose from. First reported by Japan?s Nikkei Business Daily, its latest initiative seeks to improve profitability, cutting inventories at dealerships in response to 10 consecutive months of sales declines, including 28 percent in April. Worldwide, the U.S. has accounted for 28 percent of Nissan’s sales for the fiscal year ending March 31.

Cuts will reflect at two U.S. factories and three in Mexico, with no planned layoffs or cut production lines until the latter half of the year.

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What The Heck Happened?

In terms of sales, its midsize sedan Altima has stagnated, with a 9.2 percent drop versus a 6.5 percent in U.S. sales overall this year. As a result, Nissan has extended discounted offers and increased fleet sales to rental companies and corporate sales at poor margins, with an average discount of $4,000 for each vehicle.

Other rivals have also followed suit in the cost-cutting race, following Honda’s plans to cut Accord production and Ford eliminating most sedans from its lineup entirely as consumers become more truck and SUV-centric.

NEXT: Subaru Starts Production on the Ascent in Indiana

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