Nissan is contemplating the relocation of next-generation Rogue production from the U.S. to Japan, citing the need to slash purchasing costs significantly. The Rogue, Nissan’s best-selling vehicle in the U.S., is currently manufactured in Smyrna, Tennessee, and Kyushu, Japan. With almost 40% of total output at the Smyrna plant dedicated to the Rogue, the potential move holds significant implications for Nissan.
In discussions with suppliers at the Nissan North America headquarters, the automaker called for an average 20% reduction in parts pricing, with certain suppliers facing demands for up to 30% cost cuts. Failure to meet these targets could force Nissan to shift all Rogue production to Japan, where it claims to achieve a 20% cost advantage compared to U.S. production.
A supplier revealed, “[Nissan] told us that if we can’t get closer to Japan’s cost, they will move production [to Kyushu].” Suppliers are expected to submit price quotes for the new Rogue by the end of the week, with Nissan North America presenting its manufacturing cost plan to Nissan Motor Co. executives in Japan in February.
This move, if implemented, would mark a significant development, as automotive experts express surprise at the scale of the price reduction sought by Nissan. There are suggestions that Nissan might create capacity in Japan for the Rogue by shifting some other production to China. Losing Rogue production would impact the Smyrna plant, especially with the expected end of current-generation Leaf production at the site in mid-2025.
AutoForecast Solutions vice president Sam Fiorani commented, “Pushing the Rogue to Japan will add considerable red ink to Nissan’s U.S. ledgers. Closing a plant could be in Nissan’s future.” The decision is poised to influence the automotive landscape, emphasizing the challenges and decisions faced by automakers in the evolving supply chain dynamics.