DEARBORN — Nissan has announced that due to a coronavirus outbreak in Malaysia, its sizable facility in Smyrna would be closed for two weeks starting on Monday.
Since the semiconductor shortage, which has hampered vehicle manufacturing globally, began to take hold in the latter part of last year, the stoppage is among the longest at any American auto plant of this scale.
A COVID-19 outbreak at a Malaysian chip manufacturing caused Nissan to run out of chips, the company reported on Tuesday. On August 30, it anticipates resuming manufacturing.
Six Nissan models are produced in the 6 million-square-foot Tennessee factory, which also employs 6,700 people and is home to the company’s best-selling vehicle in the United States, the Rogue small SUV.
According to analysts, the massive Nissan factory’s two-week stoppage is an indication that the semiconductor scarcity could not be ending as soon as many auto executives had planned for late this year.
The few American facilities that have been closed for two consecutive weeks are typically those that produce sedans or other lower-volume, less lucrative vehicles. Automakers have made an effort to save chips for the factories that produce their best-selling vehicles, primarily SUVs and pickup trucks. However, there have also been periodic closures of pickup vehicle manufacturing facilities, including three General Motors factories this week.
Sam Abuelsamid, principal analyst at Guidehouse Research, stated that Smyrna is a vital manufacturing for Nissan and that its closure indicates that there may not be a quick resolution to the semiconductor shortage.
Supply issues could endure even longer than that, according to Abuelsamid, as COVID-19 infections continue to spread throughout the semiconductor supply chain in Asia and other places.
There is a nationwide shortage of new vehicles as a result of the shortfall, manufacturing closures, and high consumer demand in the U.S. As a result, prices have increased and the used car market has been affected by the lack.
According to Phil Amsrud, senior principal analyst for IHS Markit who monitors the chip business, the chip scarcity is beginning to ease, but the coronavirus delta variant is beginning to cause issues at companies in the semiconductor supply chain, which is aggravating the situation.
Large silicon wafers are divided into numerous smaller integrated circuits by chip foundries in Taiwan and other Asian countries. After that, they are transported to Malaysian “back end” producers where they are subsequently sliced into chips for use in vehicle control computers.
However, as demonstrated by the Nissan stoppage, breakouts among workers in those industries and in the shipping industry are once again hurting supplies. Additionally, he added, the chips automakers are purchasing now could not be suitable for future products.
Amsrud also pointed out that poor immunization rates are common in many nations that handle the back-end jobs, such as Malaysia.
I think we’re basically setting up for Delta to have a footing in all of these places, he said. “I believe delta will continue to give us several issues.”
In This Article...
Following a COVID-19 outbreak at a Malaysian chip supplier, the Tennessee plant will be shut down through September 12.
Nissan’s U.S. manufacturing is still being impacted by a COVID-19 outbreak that occurred at a Malaysian microchip supplier plant this month.
Nissan’s Smyrna, Tennessee, facility was already closed due to the Malaysian crisis as of August 30. However, that delay will now last until September 12, which will have an impact on the manufacturing of important models including the Nissan Rogue, Pathfinder, and Infiniti QX60 SUVs.
Additionally, the Versa, Kicks, and Sentra models will not be produced in Nissan’s Aguascalientes, Mexico, facility until September 5.
Nissan is anticipated to lose 157,000 units of North American manufacturing this year, including the recently reported downtime, according to AutoForecast Solutions (AFS).
Nissan announced on August 10 that Smyrna activities would be suspended for two weeks due to the issue at the chip supplier. The provider has not been named by Nissan.
Due to a deficit in microchip allocations, Nissan has seen some manufacturing line interruptions this year, just like other automakers. However, those shortages were primarily brought on by chipmakers with constrained capacity and automakers with hazy 2021 predictions miscalculating demand.
According to AFS estimates, the chip shortfall has caused automakers to scale back their global production plans by 6.9 million vehicles.
Many in the sector continued to believe that the chip problem was progressively abating as the COVID-19 epidemic subsided and supply networks resumed operations.
However, the car sector is facing new issues due to a resurgence of COVID-19 infections, especially the transmission of the virus’ delta form.
Nissan facility in Tennessee will close for two weeks owing to a chip shortage.
SMYRNA, Tennessee (AP) Nissan has announced a two-week closure of its sizable manufacturing in Smyrna, Tennessee, beginning on Monday.
The shutdown is the result of a coronavirus outbreak in Malaysia, which has led to a scarcity of computer chips. Since the semiconductor scarcity occurred in the latter part of last year, the shutdown is among the longest at any large U.S. vehicle production. The global auto industry has been hampered by the shortfall.
Nissan stated in a statement on Tuesday that a COVID-19 outbreak at a Malaysian chip manufacturer caused a shortage of chips. On August 30, it anticipates resuming manufacturing.
Six Nissan models are produced at the 6 million square foot Tennessee plant, which also employs 6,700 people and is home to the company’s best-selling vehicle, the Rogue small SUV.
Nissan’s complete statement is provided below:
“Nissan will make additional adjustments to its North American manufacturing schedules in August as a result of a Malaysian supplier ceasing operations as a result of an increase in COVID-19 instances. The weeks of August 16 and August 23 will see all production lines at our Smyrna, Tennessee, facility shut down; production is anticipated to start up again the following week, August 30. To assess the effects of supply chain difficulties and reduce disruption for car deliveries to our dealers and customers, we continue to collaborate closely with our supplier partners.”
Nissan will temporarily close the Smyrna facility.
In response to a scarcity of semiconductors, Nissan Motor said it would halt production at its US facility in Smyrna, Tennessee, starting the following Monday (16 August), for a period of two weeks.
The business claimed that social and commercial limitations placed in place in Malaysia since the beginning of June to address the most recent coronavirus outbreak had a negative impact on output at a significant chip supplier.
Due to the persistent global shortage of semiconductors, which first surfaced about a year ago, the fortnightly halt is one of the longest closures of any vehicle assembly factory in the US.
Nissan’s Smyrna facility is a crucial one, and the two-week stoppage will have an impact on its current recovery efforts from the pandemic and other business concerns. With a production capacity of 640,000 vehicles across six models, including the most popular Rogue [X-Trail] compact SUV, the facility employs about 6,700 employees.
In the first fiscal quarter of April through June 2021, the automaker reported a 71% increase in consolidated net revenues to just over JPY2 trillion. Operating profit was JPY76 billion, up from a JPY154 billion loss the previous year, and net income was JPY114 billion.
Global chip shortages and the global coronavirus epidemic are still causing disruptions in vehicle production, and this is expected to persist well beyond 2022.
Since the end of last year, the majority of automakers have conducted irregular shutdown, usually giving priority to the production of their most lucrative models.
Nissan of Smyrna has closed, right?
Due to a coronavirus outbreak in Malaysia and an interruption in the supply of semiconductors, one of the biggest auto manufacturers in North America was forced to temporarily close.
How many people are employed by Nissan in Smyrna?
Around 8,000 people work at the Nissan Smyrna Assembly Plant in Smyrna, Tennessee, which started producing cars in 1983. 640,000 automobiles may be produced there annually, making it the most in North America in 2017.
Will Nissan cease operations?
Nine years after the firm began the Datsun brand’s global relaunch in India, rumors were rampant when the company decided to end the Datsun brand there.
Nissan India has not been shut down, despite rumors to the contrary, according to a senior corporate official who also confirmed that the company is heavily invested in India. Nine years after the firm began the Datsun brand’s global relaunch in India, rumors were rampant when the company decided to end the Datsun brand there.
Srivastava emphasized that the business has a significant investment in India “The first vehicle to be introduced in India under Nissan NEXT, the company’s global transformation plan, is the Magnite, which offers highly aspirational value. With 50,000 production rollouts, it surpassed the milestone of one lakh plus client bookings in March 2022.”
He emphasized that there are presently more than 18,000 pending client bookings for its well-liked small SUV, with a waiting time of 5 to 6 months.
Despite Magnite’s respectable demand, it is well known that the corporation is in danger in India. In India, it has had a miserable almost two-decade-long journey, both in terms of market share and footprint expansion. Nissan India, which only has one production facility in Chennai, now has a market share of less than 1%.
With aggressive efforts to maximize output in the face of obstacles from semiconductor shortages and Covid-19, Srivastava added, “We are servicing the client demand in the local and 15 export markets through our manufacturing unit in Chennai.
When senior Congress leaders asserted that Nissan themselves had ceased operations in the Indian market, the discontinuance of Datsun became a political issue. Mallikarjun Kharge, a former minister of the Union and the opposition leader in the Rajya Sabha, tweeted on Monday that Nissan has joined “Ford, General Motors, Fiat, United Motors, Premier Automobiles, and Harley Davidson” in ceasing operations in India.
“Due to “sleaze of business” and declining revenues, several automobile majors have left India one after another. No one has ever failed the Indian economy and brought shame on India abroad like the BJP, “Added he.
How long will Nissan be closed?
DEARBORN, MI — Nissan claims that due to a scarcity of computer chips brought on by a coronavirus outbreak in Malaysia, its enormous facility in Smyrna, Tennessee, would be closed for two weeks beginning on Monday.
How is the work environment at Nissan?
swiftly paced, difficult, and encouraging The Nissan staff is top-notch. I work with devoted colleagues and leaders who frequently go above and beyond. Every day presents new challenges, but I also have support to accomplish the best job I can.