Infiniti to move production out of Japan

“At 76 yen to the dollar, if this rate was to stay for a while, I think you’re going to see a hollowing out of the industry,” said the CEO last fall. At the time of writing, a dollar can be exchanged for 81.5 yen. As a result of the persistently unfavorable exchange rate, Ghosn indicated at the New York Auto Show that he would soon make good of his promise and start assembling Infinitis outside of their home country. “You won’t have to wait a long time before we make a decision about the new base for sourcing of Infiniti,” Ghosn told a group of reporters Wednesday in New York. “If you follow our logic, we should make the cars where we sell them.” The only Infiniti model that is not built in Japan is the JX35, which is built in Tennessee. All others are imported from Japan to markets around the world, including the United States, Europe, China. Importing from Japan has hurt Renault- Nissan’s profits, but it has also hurt Infiniti’s image. “Infiniti is not sold in Japan,” said Ghosn. “So this is an interesting case where you have most of the sourcing in Japan, none of the sales in Japan. And today, having the sourcing in Japan with the yen is obviously not the right system. So we’re going to be moving Infiniti out of Japan in order to give it a little bit more competitiveness.” Ghosn did not mention where Infiniti production would shift to, but according to Automotive News, he is considering either China, or North America. Nissan announced a few weeks ago that it will build a new $2 billion plant in Aguascalientes, Mexico. The plant will build Nissans for the United States market, but some speculate at least part of its production capacity will be attributed to Infini. Members of the Japanese luxury brand’s top brass have been a little more skeptical about moving production out of Japan. “Part of the myth of Infiniti is Japanese craftsmanship. You need to have something resonating around that,” said Andy Palmer, the vice president of Infiniti.