Nissan and Honda to cut China production as EV race heats up

Nissan Motor and Honda Motor are preparing to reduce their vehicle production capacity in China, Nikkei has learned, as the Japanese carmakers struggle to keep up in the electric vehicle race against Chinese rivals.

Nissan will begin talks with a local joint-venture company in the coming days to slice its capacity in China by up to 30%, which is equivalent to 500,000 cars annually. 

The Japanese company can at present make around 1.6 million cars in China every year.

Nissan operates eight factories in China, including plants in Hubei and Henan, through a joint venture with China's Dongfeng Motor.

Nissan's output in China in 2023 fell 24%, year on year, to 793,000 vehicles, falling below the 1 million mark for the first time in 14 years.

Honda also wants to reduce its capacity in China by 20% to around 1.2 million vehicles annually. 

The company is in discussions with local partners and has already told major suppliers that it will be cutting production.

Honda has a total capacity of 1.49 million cars a year in China through two joint ventures, one with GAC Group and the other with Dongfeng Motor Group.

Toyota Motor's sales in China in 2023 also fell 2%, year on year, to 1.9 million cars. 

The company sells EV models such as the bZ4x and bZ3 in the country and intends to strengthen its offerings of plug-in hybrid vehicles (PHEVs).

China's new vehicle sales in 2023 stood at 25 million units, making it world's largest market, with sales 50% greater than the U.S., the next largest car buyer.

Ref:  Nissan and Honda to cut China production as EV race heats up   (asia.nikkei)

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