Nissan to Reduce Japan Capacity 14%

Nissan Motor Co. says it will cut domestic factory capacity to 1.16 million units per year from 1.35 million units currently to shield more of its output from the effect of the strong yen.

Nissan plans to close one of two assembly lines at its Oppama plant next month, thus shrinking capacity to 240,000 units from 430,000 units. The affected line makes the Note and Tiida subcompact and Sylphy compact cars.

The idled line will be converted to build prototypes and could be restarted if domestic demand revives, according to the company. It says no jobs will be lost.

The company won't confirm a report by The Nikkei that Nissan intends to shift some production to Thailand to offset the output decline in Japan.

CEO Carlos Ghosn has pledged to make at least 1 million vehicles in Japan. The company expects to produce 1.22 million units there this year by running its facilities on overtime. Nissan built 28% of its global output last year in its home market.