June 21st, Nissan Motor has announced the closure of its passenger car factory in Changzhou, Jiangsu. At the same time, it is reported that due to a decrease in sales, Nissan Motor has decided to cut its production capacity in China by about 10%.

The official website shows that the Changzhou factory is Nissan's newest factory in China and also the production base for Dongfeng Nissan Passenger Vehicles. The Dongfeng Nissan Changzhou factory began construction at the end of 2018, with a total investment of about 1.4 billion yuan, managed entirely by Dongfeng Nissan, covering an area of 550,000 square meters, with an annual production capacity of 130,000 vehicles, accounting for about 8.13% of Dongfeng Nissan's total output, which is not a large proportion.

Looking at the production time of the Changzhou factory, it has been in production for less than four years. As to why the factory will be closed, it may be related to the poor sales of Nissan Motor. A spokesman for Nissan Motor said that the closure of the Changzhou factory is to optimize production and is also part of the strategic adjustment to respond to market challenges, and the company is still committed to developing its business in China. In addition, according to insiders, after the factory is closed, most of the laid-off personnel will be compensated with at least N+1 compensation, but a few senior executives will go to other bases or resign and leave directly.

The closure of Nissan Motor's passenger car factory in Changzhou, Jiangsu, also reveals its difficult situation in the Chinese market. Joint ventures with fuel vehicles as the main sales are facing the problem of declining sales and excess capacity. As a result, many car companies have started to sell factories and close and transfer in the field of joint ventures in recent years. Several analysts have previously said that the next 3 to 5 years will be a watershed for the automotive industry, and most car companies will be eliminated in the elimination competition.

MDGloble believes that with the shrinking market share of fuel vehicles, joint ventures such as Nissan Motor need to adjust their strategies to adapt to the development trend of new energy vehicles. This trend is increasingly obvious in the global automotive industry, and companies need to maintain competitiveness by optimizing resource allocation.

Thank you for listening. Stay tuned for more about MD-Auto-News.