Japanese automaker Nissan Motor plans to halt vehicle production at its Wuhan plant in China by 31 March 2026 due to low output, reported Reuters, citing two sources with knowledge of the plan.
This decision follows a drop in the operation rate at the plant, which has a capacity of 300,000 vehicles.
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It manufactures Ariya electric vehicle and X-Trail SUV, but is challenged by Chinese competitors, reported The Japan News.
Annual production at the Wuhan facility, leased from Dongfeng Motor, has only reached approximately 10,000 units since operations commenced in 2022.
The Japanese carmaker recently forecasted a record net loss of Y700bn to Y750bn ($4.87bn-$5.22bn) due to impairment charges for the financial year ending 31 March 2025 (FY2024).
Last month, Nissan Motor reported 12.1% year-on-year decline in global production for February 2025.
Nissan Motor’s global production totalled 237,982 vehicles. While production in Japan reached 52,198 vehicles, down 13.2% from the same period a year ago, production outside Japan touched 185,784 vehicles, a fall of 11.7%.
The US saw a 21.4% decrease to 47,088 units, while the company’s production grew by 7.2% to 59,731 units.
The UK saw a 12.8% decline with 25,764 vehicles produced, while China experienced a 35.6% drop to 24,890 vehicles.
Although Nissan plans to export 100,000 cars manufactured in China annually to counter the sales decline, high tariffs imposed by the US and Europe may create uncertainty around this strategy, according to The Japan News report.
In June 2024, Nissan shut down its Changzhou facility in China’s Jiangsu Province.
Following the planned closure of the Wuhan plant, Nissan’s production bases in China will be reduced to four.
