Nissan to invest $900 million on new assembly plant in China: Nikkei

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Japan’s Nissan Motor Co will spend around 900 million US dollars to build a new auto assembly plant in China that will increase production capacity in the company by 30 percent, the Nikkei newspaper reported on Monday.

Nissan, which operates in China through a joint venture with Dongfeng Motor Group Co Ltd, is in final stages of talks with its Chinese partner to build a new plant in Wuhan in Hubei province, the Nikkei reported without citing sources.

The investment in Wuhan, which totals 100 billion yen (905 million US dollars), is expected to have an annual production capacity of 200,000 to 300,000 cars a year, the Nikkei reported.

New production lines will be added to a Dongfeng plant in Changzhou in Jiangsu province, which will increase capacity by about 120,000 passenger cars a year, a spokesman from Nissan told Reuters in response to questions about the Nikkei’s story.

In addition to Changzhou, Nissan is exploring the possibility of expanding production capacity in China, but no further details can be confirmed, the spokesman said.

Nissan sold 1.5 million vehicles last year. Its goal is to sell up to 2.6 million vehicles a year by 2022, said the source.

Nissan in February outlined a five-year plan, dubbed “Triple One,” to increase its market share in China by focusing on electric cars and the Venucia, a no-frills local Nissan brand in China - two market segments expected to see a surge in demand. It also aims to boost sales of light commercial vans and trucks.

Rival Toyota plans to boost its China capacity over the next few years by 240,000 vehicles a year, or by about 20 percent, from its current capacity of 1.16 million vehicles a year.

Source(s): Reuters