Tag: Oppama

Facing multiple challenges including the global electrification transformation and its own sluggish sales, Nissan announced today (July 15th) that, as part of its "Re:Nissan" corporate restructuring plan, it will close its Oppama Plant in Kanagawa Prefecture by the end of fiscal year 2027 and transfer the production line to its Kitakyushu plant. This move aims to control production costs and improve capacity efficiency. The Oppama Plant has been operating since 1961, with approximately 60 years of history. It has produced iconic Nissan models such as the Datsun Bluebird, March, Cube, LEAF, and Note, making it one of Nissan's most symbolic vehicle production bases in Japan. The plant currently employs approximately 2400 people and primarily produces small cars such as the Note and Note Aura. However, due to Nissan's less-than-expected sales performance in the Japanese domestic market in recent years, the plant's capacity utilization rate has remained consistently low. Nissan stated that after extensive operational evaluations, it decided to concentrate its production lines at its Kitakyushu plant. This will not only help integrate resources and improve logistics efficiency but also reduce overall operating costs. The relocation is expected to allow for higher production line capacity, aligning with the capacity optimization strategy emphasized by "Re:Nissan." While announcing the closure of the Oihama plant's production lines, the plant will not be completely shut down. Nissan emphasized that functions including the research institute, GRANDRIVE test track, crash test facilities, and dock will continue to operate, and these R&D and testing resources will continue to support Nissan's vehicle development needs. Furthermore, Nissan has committed to protecting the employment rights of existing employees at the plant until at least the end of fiscal year 2027 and will actively evaluate transfer and relocation options to minimize the impact on manpower. It's worth noting that earlier this year, there were rumors that Foxconn intended to take over the underutilized Oihama plant as one of its electric vehicle production bases. However, with Nissan's announcement of the production line relocation to Kitakyushu, this cooperation plan may fall through. According to Nissan's publicly released "Re:Nissan" restructuring plan, the company will further reduce its global production capacity and network size, planning to reduce its global annual production capacity (excluding China) from approximately 3.5 million vehicles to 2.5 million vehicles, and its production bases from 17 to 10. This aims to achieve 100% production line utilization and improve its overall financial and production capabilities. Facing changes in the global automotive market and pressure from the electric vehicle market, this adjustment by Nissan reflects its proactive and accelerated reform efforts. While carrying historical emotional baggage, it must still make strategic choices regarding the use of its manufacturing resources in order to achieve long-term, stable development. The temporary closure of the Oihama plant also symbolizes Nissan's formal entry into a new phase of capacity restructuring and strategic transformation.

Following earlier reports that Nissan was in talks with Foxconn regarding a collaboration, Nikkei reported earlier that the two companies are actively discussing a joint electric vehicle production plan at Nissan's Oihama plant in Yokosuka, Kanagawa Prefecture. The report suggests that Foxconn may manufacture its own brand of electric vehicles at the plant, potentially ushering in a new era for electric vehicle production in Japan. The Oihama plant, which opened in 1961, has long been one of Nissan's main production lines, currently employing approximately 3900 people and providing stable employment for the local community. However, with the global automotive market shifting towards electric vehicles and Nissan's capacity restructuring efforts, the plant has been repeatedly rumored to be closure or undergoing merger assessments. In May of this year, Nissan announced that it would reduce its global vehicle manufacturing plants from 17 to 10, with the Oihama plant and its subsidiary's Shonan plant included in the restructuring plan. Currently, the Oihama plant primarily produces small cars such as the Note, with an annual capacity of 240,000 vehicles. However, according to market research firm MarkLines, the plant's capacity utilization rate in 2024 was only about 40%, far below the 80% required for break-even, becoming a heavy operational burden for Nissan. To revitalize the plant's resources, Nissan is exploring having Foxconn take over some of its idle production lines and produce its own brand of electric vehicles, thereby improving overall production line utilization and reducing Nissan's operational pressure. For Foxconn, this collaboration would allow it to expand its market presence in Japan and establish electric vehicle manufacturing capabilities within the country, deepening its "electric vehicle + manufacturing services" strategic layout. If this collaboration proceeds smoothly, in addition to bringing new production momentum to the Oihama plant, Nissan can also avoid the large-scale workforce adjustments and asset losses that would result from plant closure. More importantly, the Oihama plant is surrounded by a large number of Nissan's component suppliers. Preserving these supply chains will help maintain the competitiveness of the Japanese automotive industry and stabilize the local economy and employment structure. As global automakers accelerate their electrification transformation and adjust their production capacity structure, Japan's domestic automobile manufacturing bases are bound to face more challenges in the future. Whether the negotiations between Nissan and Foxconn can become a model of cross-industry cooperation is not only crucial for corporate restructuring but also a litmus test for the Japanese manufacturing industry to move towards a new stage. However, Nissan and Foxconn are still in the detailed negotiation stage. If the cooperation is successfully finalized, the Oihama plant is expected to see the production of a new electric vehicle model within the next few years at the earliest.