Nissan Motor is working to reduce costs on vehicles manufactured in Mexico to offset the impact of 25% US tariffs, which have made the models harder to sell in the American market.

In an interview with Bloomberg TV, CEO Ivan Espinosa said the company was concentrating on models currently subject to the 25% tariff rate, as the US-Mexico-Canada trade agreement is not being renewed.

Nissan has retained production of entry-level models, including the Sentra compact and Kicks crossover, in Mexico to take advantage of lower labour costs, even as it has relocated output of other vehicles to limit tariff exposure.

The company has said the tariffs add roughly $2,500 to $3,000 to the cost of each Kicks or Sentra.

Vehicles built in Mexico made up more than a third of Nissan's US sales last year.

This included the Sentra and Kicks, along with three models since discontinued: the Versa sedan and Infiniti's QX50 and QX55 crossovers.

The Versa had been the only 2025 model-year vehicle sold in the US priced under $20,000.

"[The tariffs are] making part of the lineup that we are bringing in from Mexico difficult to sell. Looking at the pressure that the US market has today in terms of affordability, we see that potentially some of the buyers could be moving into this type of vehicle, so we are working very strongly on making them more competitive," Espinosa was quoted as saying.

Espinosa downplayed the extent to which the yen's fall to a 40-year low against the dollar would influence Nissan's US strategy.

"We will continue the strategy that we have set in the US, which is building cars in the US," he said, adding: "With the current context in which we are living, it does make sense to continue investing in the US."

Nissan ended last year producing around 60% of the vehicles it sells in America domestically, up from roughly 45% at the start of 2025.