According to reports made by Bloomberg, Nissan Motor Co. will boost output capacity in Mexico to about 700,000 vehicles a year and may consider increasing exports from the U.S. as the strong yen makes North American production more competitive.
Nissan, Japan’s third-largest carmaker, is spending $600 million to upgrade two Mexican auto plants and is increasing U.S. production as a stronger yen make exports from Japan less profitable. The yen has risen against all the world’s major currencies in 2010 and is up about 5 percent against the U.S. dollar and 14 percent against the euro this year.
Nissan, based in Yokohama, has declined 20 percent this year in Tokyo trading.
The automaker has already moved some production overseas from Japan, citing the nation’s rising currency. The company has begun assembling its new March small car in Thailand and will start making it in Mexico in 2011.
Nissan will cut output in Japan by about 20 percent from October compared with its September production plan because of the yen’s strength and the expiration of government subsidies in the nation, Yokohama-based spokesman Mitsuru Yonekawa said July 27.
The company’s U.S. factories are in Tennessee and Mississippi. The company exports U.S.-built light trucks to the Middle East and has shipped Quest minivans to China.
The company has the largest market share in Mexico and was the top producer of vehicles there last year, making 355,414 units.