Nissan Halts New US Orders

In a surprising move on Thursday, Nissan Motor announced that it will not accept new orders from the United States for its Mexican-built Infiniti SUVs, the QX50 and QX55. This decision comes in the wake of new auto tariffs imposed by former President Donald Trump, marking a significant retreat from its operations at the COMPAS plant in Mexico, a joint venture with Mercedes-Benz.

Nissan's Production Adjustments

The automaker stated that it will maintain two production shifts for the Rogue SUV at its Smyrna, Tennessee plant, countering earlier plans to reduce to one shift. The decision not to take new orders for the Infiniti models is particularly striking; these SUVs have predominantly been exported to the U.S. market, as reports from Mexico's national statistics agency indicate no substantial exports to other markets. Although Nissan confirmed some shipments to regions like the Middle East and Canada, the precise volume remains unclear.

Impact of New Tariffs

With the recent implementation of the 25% global car and truck tariffs, Nissan is feeling the pressure more than most, given its status as the leading Japanese brand exporting vehicles from Mexico to the U.S. The consequences of these tariffs come at a challenging time for Nissan, which has been grappling with an aging vehicle lineup and a notable absence of hybrid models in its offerings.

Profit Forecasts and Leadership Changes

This predicament has forced the company to revise its profit forecasts downward three times this past financial year, culminating in a credit rating downgrade to "junk" status. As the stakes rise, the company's new CEO, Ivan Espinosa, 46, a Mexican native with a background in planning, is determined to turn the tide. He has promised to significantly shorten the development cycle for new vehicles, perhaps signaling a shift in strategy as the company adjusts to market conditions.

Future of Nissan and Mercedes-Benz Partnership

Mercedes-Benz continues to produce its GLB SUV at the COMPAS plant, which raises questions about the future synergy between Nissan and Mercedes in their manufacturing relationship. As the automotive landscape evolves in response to tariffs and changing consumer expectations, all eyes will be on Nissan to see how it maneuvers through this turbulent period.

Conclusion

Stay tuned as we follow this story and its implications for the entire automotive industry!