Japanese legacy automaker Nissan has just postponed its next-gen electric vehicle production plans at its Canton factory in Mississippi due to slower-than-expected uptake, Automotive News reports.
Plan changes
Nissan decided to put its $500 million investment on hold at its underutilized assembly factory in Canton, Mississippi.
The Japanese automaker adjusted the “development schedule” of two all-electric sedans to “enhance product competitiveness,” per the May 17 memo to suppliers.
“Please stop all development activities related to [the electric sedans] until further notice.”
Nissan told suppliers
Notably, Nissan initially planned to start producing the electric sedans in June 2026. However, it has delayed the plan twice, with the latest start date set for November of the same year.
Nissan will update its suppliers about the new production start date in mid-June, according to the report.
“I think it’s going to be at least six or eight more months before [Nissan] returns with a new plan.”
Unnamed Nissan supplier
Excitingly, Nissan indicated in the memo that it plans to increase the number of BEV models in its Canton factory to five. GlobalData Automotive suggests that the codenamed “PZ1L” model will arrive as a compact crossover. Moreover, it is the third electric utility vehicle planned for the Canton factory.
Nissan also changed the production sequence from the original plan of prioritizing sedans to two midsize crossovers.
“We are adjusting the timeline for the introduction of these five new models to ensure we bring the vehicles to the market at the right time, prioritizing in line with customer demand and maximizing the opportunity for our brands and supplier partners.”
Nissan (via CNN)
Market slowdown
Nissan Americas Chairperson Jeremie Papin reportedly said last week that the Japanese automaker is just being “pragmatic and reactive” to customers’ electric vehicle demand.
“What matters is making sure that we launch the vehicles that the customer wants, at the time the customer wants it.”
Nissan Americas Chairperson Jeremie Papin
Cox Automotive indicated that electric vehicle sales surged 2.6% year-on-year in Q1 2024. That rate is substantially slower than the 46% YoY sales growth in the same period last year.
“Trying to find just the right mix of EVs and timing their arrivals to hit at just the right time is crucial to Nissan’s success. This could be Nissan’s most important decision in its history.”
AutoForecast Solutions Vice President Sam Fiorani
Looking forward
The EV production delay comes as Nissan reevaluates its vehicle development and sourcing strategy.
According to the report, the company is also anticipating the US presidential election results in November. Trump’s win may result in the withdrawal of the Biden administration’s EV incentive programs.
Nonetheless, Nissan still aims to roll out 19 electric vehicle models globally by 2030. It previously declared plans to allocate $500 million to the Canton factory for the next-gen EV production. The domestic factory currently employs about 5,000 workers and produces the Nissan Altima sedan Frontier, Titan, and Titan XD pickups.
Notably, Nissan is not the only automaker that has scaled back electric vehicle plans. In 2023, General Motors decelerated its planned Silverado electric pickup production ramp-up due to slowing consumer uptake. Ford also reduced the planned factory size for EV battery production.
