Nissan could turn one of its Japanese factories into a new subsidiary to allow it to broach wage negotiations with labour unions and seek lower prices from suppliers.
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It’s a move aimed at cutting costs and would involve the establishment of a new company in the second half of next year.
The factory in question is on the southern Japan island of Kyushu [also home to a key Toyota Lexus plant -ed] which builds 430,000 cars a year including Nissan’s Teana, Lafesta and X-Trail models, Reuters reported.
Nissan told the news agency it would approach unions to discuss the proposal – the first time the carmaker has separated some of its vehicle assembly operations into a separate company.
A company spokesman told Reuters said Nissan wants a low cost production base in Japan, close to competitive suppliers in and out of Japan, with labour expenses also open to discussion.
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By GlobalDataThe spokesman did not confirm whether Nissan plans to ask its auto unions for pay cuts, saying that wage levels would stay unchanged for “a certain time”.
A strengthening yen has made car production in Japan expensive, particularly small models. Lowering costs at home would help companies avoid the cost of relocating to lower wage markets.
In March, Nissan moved output of its small March car to Thailand, the first time it has shifted production of one of its popular domestic model outside Japan.
