Nissan Cuts Petrol Car Production as China EV Demand Accelerates

Nissan is reducing production of petrol cars in response to the rapid rise of electric vehicle sales in China, with the manufacturer saying the shift to new energy vehicles is happening faster than expected and describing market conditions as harsh.

The move reflects the pressure on legacy combustion-engine lines as Chinese consumers move toward electrified models. Nissan framed the production adjustment as a response to that faster-than-anticipated transition, rather than a temporary dip in demand.

The decision underscores the scale of the challenge facing foreign automakers in China, where the pace of electrification has reshaped the competitive landscape. For Nissan, cutting petrol output means reallocating manufacturing capacity away from models whose demand is softening.

Investors will watch how quickly the company can align its product mix and factory utilisation with the new demand pattern. The company's own characterisation — that the shift is outpacing expectations and the market is harsh — signals that further adjustments to production plans may be required.

The announcement also highlights the widening gap between China's electrification trajectory and the slower pace of transition in other markets where petrol vehicles remain central to sales. For Nissan, the immediate task is managing the cost of lower combustion-engine volumes while positioning for a market increasingly dominated by new energy vehicles.

The production cut is a concrete signal that the transition is now affecting factory planning and output decisions, not just future model line-ups.