Nissan cuts petrol car production as China EV demand accelerates
Nissan has said it will reduce petrol car manufacturing and increase production of battery electric vehicles and plug-in hybrids in China after weaker-than-expected demand and intensifying competition forced it to lower its sales forecast. The Japanese carmaker said the shift in the world's largest auto market is happening faster than it had expected. It described China as its biggest challenge.
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The company now expects to sell between 2.97 million and 3 million vehicles this year, down from a previous forecast of 3.15 million. Nissan said sales in China fell 22% in the first half of the year and were down 32% in the first nine months. It said pressure intensified from July through October, as the market became more difficult.
Ivan Espinosa, Nissan's chief executive, said demand was weaker, competition was intensifying and the market was being very harsh. He said the company's product line-up in China, led by the Sylphy family of saloon cars, was too closely associated with petrol engines. Nissan said it would cut local production, export some products and ramp up its N series of electric and plug-in hybrid models.
The move underlines the speed of change in China's car market, where government support helped build a large domestic electric vehicle industry. That has created intense competition for foreign manufacturers that once relied on petrol and diesel models for much of their sales. Nissan's decision also reflects a wider challenge for global carmakers trying to balance older combustion-engine lines with the need to compete in new energy vehicles.
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The company said sales had risen in its home market and in North America, where the transition to electric cars has been slower. That contrast highlights how differently major markets are evolving, and why manufacturers are being forced to adjust production plans region by region. For Nissan, China remains the most difficult market in its current strategy.
What remains unclear is how quickly the company can reshape its Chinese operations and whether the planned shift will be enough to stabilise sales. Nissan has not given a detailed timetable for the production changes. Investors and rivals will be watching for further signs of how the company responds to the price war and the continuing rise of Chinese EV makers.
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