Tariffs Forced Nissan to Speed U.S. Production, Says Americas Chairman

Nissan Americas Chairman Christian Meunier discussed the challenges presented by tariffs, stating that they are "killing us at this moment." His comments came after President Donald Trump publicly congratulated Nissan for its manufacturing success in the US. Meunier acknowledged increased US production but emphasized the negative impact of current tariff policies on the company's operations.

Nissan has been actively restructuring its supply chain due to tariffs. While sales in Japan and the US saw modest increases of 3.6% and 2.3% respectively, global sales plummeted by 16.5%, and global production fell by 15.5% year-over-year in July. Critically, China sales dropped by 58.7%, and production there decreased by 66.9%, leading Nissan to reduce its full-year sales target by 150,000 units specifically due to the Chinese market. Conversely, US production surged by 34.2% in July and 36.2% for the fiscal year to date, reflecting Nissan's "Built in the U.S. for the U.S." strategy.

The company's efforts to mitigate tariff costs have been significant. Nissan successfully cut $2.3 billion in tariff costs by increasing US assembly and reducing reliance on imported parts, particularly from China. This shift has resulted in a unique situation where tariffs, typically a cost, appeared as a benefit in Nissan's first-quarter earnings report, helping operating profit return to positive territory. Despite a 15% tariff on Japanese-built vehicles imported into the US under a 2025 trade framework, this option can be more predictable than the volatile tariff landscape for vehicles from Mexico.

Meunier has also pressed Washington for tariff relief on cars made in Mexico, arguing it is crucial to keep entry-level models like the Sentra and Kicks affordable, as lower labor costs in Mexico are essential for these vehicles. Nissan has slowed production in Mexico by 18.9% for the month and 23% year to date. The automaker, like many others, is bracing for a potential jump in auto tariffs to 50% in 2027, which would further reshape global manufacturing strategies.