Sales volume has dropped by half in five years. Nissan's closure of its Changzhou plant is not the end, but the beginning of the withdrawal of foreign capital.

Nissan Motor's passenger car plant in Changzhou has been closed, resulting in a 10% reduction in production in the Chinese market.

The Changzhou plant is the smallest of Nissan's eight joint ventures in China, with an annual production capacity of about 130,000 vehicles. It was put into production in November 2020, just four years ago, and mainly produces Qashqai models. Last year, Qashqai's cumulative sales in China were 113,000 units, and the cumulative sales from January to May this year were about 45,000 units. The designed production capacity of the Changzhou plant is 130,000 units, and idle production capacity is inevitable.

Because of this, the news of the factory closure has attracted widespread attention in the industry. First, it is the old topic of fuel vehicles being replaced by new energy vehicles, and second, it is a reflection on the future and destiny of Nissan in China.

Generally speaking, if a car factory's production capacity is underutilized, it can be adjusted to produce other models. However, for Nissan, this problem is more difficult because none of its models are competitive in China.

In May 2024, Nissan's sales volume reached 56,000 vehicles, of which the Sylphy alone contributed 31,000 vehicles. The sales volume of the brand's backbone, the Teana, has dropped to the 5,000-vehicle level, and the sales volume of the X-Trail is less than 3,000 vehicles.

In fact, Nissan's closure of its Changzhou factory was also a helpless move by its joint venture partner in China, Dongfeng Nissan.

Dongfeng Nissan's financial report shows that Dongfeng Nissan's annual production in 2023 will be only 737,100 vehicles, and its capacity utilization rate will be less than 50%. Dongfeng Nissan chose to close the Changzhou plant, probably because the Changzhou plant is small in scale and has little impact in all aspects.

Judging from the current situation, the rest of Dongfeng Nissan's factories may also be in trouble. Since 2019, Nissan's sales have declined for five consecutive years. In 2019, Nissan's sales in China were 1.5469 million vehicles, but in 2023, it fell to 793,800 vehicles.

The ups and downs in sales are not a big problem, but as a mainstream brand, Dongfeng Nissan's sales have dropped by half in five years, proving that it is stepping on the accelerator on the downhill road and has not stepped on the brakes at all.

There were already signs that Nissan was about to suffer a complete collapse in China.

From January to May this year, Dongfeng Nissan's capacity utilization rate was only 16.76%, and its output was 268,200 vehicles, a year-on-year decline of 6%.

Sylphy accounts for half of Dongfeng Nissan's sales, with cumulative sales of 135,000 units from January to May this year. The reason why it has such a good performance is firstly because of its low price and large discount.

The return of the Qashqai to the 10,000-unit monthly sales club in May was also the result of a significant price cut. The starting price of this car has now fallen below 100,000 yuan. Apart from these two models, the rest of Dongfeng Nissan's models have basically disappeared from the mainstream list. To return to the list in the future, it will require not only strength, but also a little bit of luck - such as increasing the intensity of export business.

In terms of new energy, Dongfeng Nissan's performance is even more disappointing. The Arria is the only real new energy model under Dongfeng Nissan. The cumulative sales from January to May were only 1,445 units, with an average of less than 300 units per month, and it is just one step away from delisting.

In fact, Nissan has encountered similar crises in history, but was saved by the "Nissan Revival Plan" of the amazing CEO Carlos Ghosn in 2001. However, in the Chinese market, Nissan is unlikely to have such an opportunity, because now is the era of new energy, and minor repairs and financial tricks in the field of fuel vehicles are unlikely to save Nissan's business in China.

In order to get out of its current predicament, Dongfeng Nissan will inevitably need to launch more competitive models. However, from the current perspective, such a revival plan is too extravagant for it. On the road to decline, Dongfeng Nissan has gone too far.

First of all, the performance of traditional fuel vehicles has not seen any substantial breakthroughs for many years and is gradually approaching the limits of fuel engines. No matter how they are upgraded, they are only piecemeal.

Secondly, Dongfeng Nissan used to make money too easily in the Chinese market. The Nissan Qashqai did not change its model for seven years, and the Nissan X-Trail was stubborn enough to use a three-cylinder engine that Chinese consumers disliked. These are typical failures. Dongfeng Nissan has lost its aggressive spirit.

Fuel vehicles can no longer be saved, so can new energy vehicles be saved?

In the middle of this month, Dongfeng Nissan released the "New Struggle 100" action plan, announcing that it will invest more than 10 billion yuan in research and development in the next three years. The R&D team will be increased from 1,600 to 4,000 people. At the same time, it will be dominated by local teams, local technologies, and local ecosystems, and will launch seven new energy products before 2026.

How good is this seemingly ambitious plan? If it was proposed five years ago, it would be enough to prove Dongfeng Nissan's courage; but if it is proposed now, it can only be regarded as self-consolation.

Nowadays, investing 10 billion in three years to build cars is not too much. Currently, mainstream new energy manufacturers have to spend tens of billions of dollars to develop a usable car manufacturing platform. Launching seven new energy vehicle models before 2026 sounds impressive, but in fact it is just the passing line in the industry.

Moreover, how can Nissan guarantee the sale of these models without mastering the core technology? Three years later, the technical strength of Chinese new energy manufacturers will be further improved, and the market share may increase to more than 70%. Dongfeng Nissan has a huge gap in product strength now, let alone three years later?

Besides, it is basically impossible for Dongfeng Nissan to let the Chinese team lead the product. Joint ventures have always been dominated by foreign brands. Even if sales decline, foreign capital will not give up power to the Chinese team. If you don't believe it, just look at other joint venture car manufacturers in China. Which one doesn't shout about localization loudly, but in actual operation, even a screw needs foreigners to review the standard.

The decline in sales of joint ventures is a common phenomenon, but so far, no joint venture has been dominated by Chinese technical teams. In the Chinese market, the foreign-funded part of the joint venture is still arrogant, although it seems that this arrogance is no different from that of a frog in a well, which is ridiculous and pitiful.

The resurgence of joint ventures in the Chinese market is basically a fantasy now, which is neither in line with business common sense nor human nature. How can mainstream joint ventures surpass Chinese manufacturers in a few years when they have not even figured out basic things like the three-electric system? They have been using obsolete foreign technologies to reap profits in the Chinese market for decades. They have been making easy money for so many years, and due to inertia, how can they strive to become stronger?

People are not afraid of suffering too much, but they are afraid of tasting too much sweetness. It is said that it is difficult to go from luxury to frugality.

Therefore, what Nissan is facing now is not the problem of how to revive itself, but the question of how long it can last.

Putting aside those unrealistic plans, the only effective measure Dongfeng Nissan can currently use is actually price reduction.

There is a saying in the Chinese market: Thanks to the efforts of domestic brands, I can drive a Teana worth tens of thousands of yuan.

Classic models such as Sylphy, Teana, and Qashqai can still attract some users through large-scale price cuts. The Chinese market is too large, and Dongfeng Nissan has a good reputation among many old users. But this is also Dongfeng Nissan's last resort, and its validity period will become shorter and shorter.

Market experience over the past year has shown that the substantial price cuts of joint venture models have only slightly slowed the downward trend but have not changed the fact that users have been leaving in large numbers.

It is difficult for us to determine the "deadline" of Dongfeng Nissan, but according to predictions from industry insiders, the cost-effectiveness of domestic new energy vehicles will surpass that of fuel vehicles of the same level in 2025. This is a critical time node. By then, even domestic fuel vehicles will be delisted at an accelerated pace. How much time is left for joint ventures like Dongfeng Nissan? The closure of the Changzhou factory may just be the beginning of the withdrawal of foreign-funded car manufacturers.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.