Nissan Cuts Production of Popular SUV

Nissan slashes production of its best-selling Rogue SUV as new U.S. tariffs strain the Japanese automaker’s bottom line and force a strategic retreat from the American market.

At a Glance 

  • Nissan is cutting Japanese production of the Rogue SUV by 13,000 units (20% of quarterly U.S. sales) over the next three months
  • The 25% tariff imposed on cars built overseas by the Trump administration is driving production changes across the automotive industry
  • Nissan will maintain production at its Tennessee facility, which is less affected by the new tariffs
  • Mexican-built Nissan Sentra and Versa models face potential price increases due to the 25% tariffs
  • New vehicle prices, already averaging $48,000 last year, are expected to rise further for American consumers

Tariffs Force Nissan to Scale Back Popular SUV Production

Nissan is reducing production of its popular Rogue SUV at its Kyushu plant in Japan, cutting output by 13,000 units between May and July. This reduction represents more than 20% of the vehicle’s quarterly U.S. sales and comes as a direct response to the 25% tariff on foreign-built vehicles implemented by the Trump administration. 

The Rogue, which ranks ninth in the 2024 best-selling car race in America, has been a cornerstone of Nissan’s U.S. strategy, making this production cut particularly significant for the Japanese automaker’s American presence. 

Workers at the Kyushu plant will experience reduced hours, with some shifts being halted entirely due to the tariff impact. The production facilities in Japan have become less economically viable for vehicles destined for the U.S. market under the new trade conditions. Meanwhile, Nissan will maintain operations at its Tennessee manufacturing facility, which continues to produce Rogue SUVs for the American market without facing the same tariff barriers as Japanese-built units. 

Industry-Wide Adjustments to Trade Barriers

Nissan’s production cuts reflect a broader trend across the automotive industry as manufacturers scramble to adapt to the new tariff environment. Several major automakers are reconfiguring their manufacturing and supply chains in response. General Motors has increased production of American-made trucks, Ford has begun offering discounts to offset potential price increases, and Stellantis has laid off 900 U.S. employees while temporarily shutting down a Mexican plant. Honda has taken perhaps the most direct approach by moving production of its next-generation Civic hybrid from Mexico to Indiana.

“We are committed to adapting to market changes while prioritizing workforce and production capabilities,” Nissan stated regarding their production strategy. 

The tariffs have effectively disrupted the global automotive supply chain that manufacturers have spent decades optimizing. Companies that rely heavily on the U.S. market for sales, like Nissan, are particularly affected and must quickly implement alternative strategies to maintain competitiveness. This includes potentially raising prices, reducing imports, or shifting production to facilities within the United States or countries with more favorable trade agreements. 

Impact on American Consumers and Vehicle Pricing

The tariffs are expected to drive up both vehicle prices and insurance premiums for American consumers. With the average new car price already reaching $48,000 last year, additional increases could further strain household budgets. Nissan’s Mexican-built Sentra and Versa models, which are also subject to the 25% tariffs, could see significant price increases if the company passes these costs on to consumers. Some manufacturers may attempt to absorb portions of these costs to remain competitive, but most analysts expect at least some of the tariff burden to reach car buyers. 

“We are reviewing our production and supply chain operations to identify optimal solutions for efficiency and sustainability,” a Nissan spokesperson explained.

Nissan’s broader strategy includes reducing global capacity by 20% as part of a restructuring plan pre-dating the new tariffs. The company’s new CEO, Ivan Espinosa, faces mounting pressure to improve Nissan’s competitiveness in the U.S. market, which has been challenged by an aging vehicle lineup and a shortage of hybrid models as consumer preferences shift. The tariff situation adds yet another complex variable to Nissan’s already challenging market position in North America.

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