Core Viewpoint - Nissan Motor Co., Ltd. has temporarily halted production of three vehicle models in the U.S. for the Canadian market due to escalating trade tensions and tariffs between the U.S. and Canada [1][2][9] Production Impact - The affected models include the Pathfinder and Murano SUVs, and the Frontier pickup, with production stopped in Tennessee and Mississippi [1][3] - The production pause is a response to a tariff dispute initiated by the Trump administration's 25% tax on auto imports, which led Canada to impose its own tariffs on American-made vehicles [2][4] Economic Viability - Nissan confirmed that the new tariffs have made it economically unviable to continue exporting these models to Canada, leading to an indefinite hold on production for the Canadian market [3][4] - Approximately 80% of Nissan's Canadian sales come from vehicles produced in Mexico and Japan, indicating a reliance on non-U.S. production for Canadian sales [4] Financial Challenges - Nissan is facing broader financial stress, reporting a net loss of $4.5 billion for the fiscal year ending in March and dealing with nearly $4.8 billion in debt due this year [5][9] - The disruption in production highlights deeper financial and operational challenges for the company, despite Canada representing a relatively small portion of its global business [5] Market Uncertainty - The future of U.S.-Canada trade talks remains uncertain, raising questions about whether the tariff situation will ease and if other automakers will take similar production steps [4]

Investment Rating - The report maintains an "Underperform" rating for Nissan Motor Co Ltd with a price target of ¥250.00 [1][7][39] Core Insights - Nissan's Q1 profits may appear better than guidance, but the path to a turnaround is expected to be challenging due to structural headwinds and the impact of US tariffs [1][10][14] - The company has lowered its operating profit forecast for FY3/26 to JPY -160 billion, reflecting a more conservative perspective on the impact of US tariffs [2][13] - The Re:Nissan recovery plan aims to achieve positive operating profit and free cash flow by FY3/27 through cost reductions and refining market strategies [12][39] Financial Performance - For FY3/25, Nissan reported sales of JPY 12,633 billion, operating profit of JPY 70 billion, and a net profit of JPY -671 billion, with operating profit falling short of guidance by 18% [11] - The forecast for global retail volume in FY3/26 is 3.161 million units, a decrease of 5.5% year-over-year, with a significant impact expected from US import tariffs [2][13] - The company anticipates an operating loss of JPY -200 billion for Q1, attributed to reduced shipment volumes and increased unprofitable fleet sales [3][14] Strategic Initiatives - The Re:Nissan plan includes reducing variable and fixed costs by JPY 250 billion each by FY3/27, consolidating vehicle plants, and reducing the workforce by 20,000 employees by FY3/28 [12][39] - Nissan aims to redefine its market and product strategy, focusing on key markets and models, while reinforcing partnerships with Renault and MMC [12][39] Market Context - Nissan has faced a 40% drop in global sales volume over the past five years due to intensified competition in core markets [17][18] - The company continues to lose market share in the US, China, and ASEAN regions, indicating a structural issue that needs addressing [20][22][24]

Core Viewpoint - Nissan is considering relocating the production of its Sentra model from Mexico to the United States to avoid tariffs [1] Group 1 - The potential move aims to mitigate the impact of tariffs on the company's operations [1] - This decision reflects broader trends in the automotive industry regarding supply chain adjustments and tariff management [1]

Core Viewpoint - Nissan is considering relocating the production of its Sentra model from Mexico to the United States to avoid tariffs [1] Group 1 - The potential move aims to mitigate the impact of tariffs on production costs [1] - This decision reflects Nissan's strategy to adapt to changing trade policies and economic conditions [1]