Nissan Ending Spain Truck Production After 40 Years

MADRID – Nissan will stop assembling medium-duty trucks at its Avila factory in September 2019 and convert it into a stamping plant for parts to be used by the Renault-Nissan Alliance.

The Avila plant currently employs 471 people, but Renault Spain President Jose-Vicente de los Mozos says about 100 jobs could be eliminated by the time NT400 truck production ends.

Nissan Spain says it will invest €40 million ($43.7 million) to transform the truck-assembly plant into one that mainly will produce stampings and other assembly parts for Renault and Nissan car bodies in the European aftermarket.

“This implies that it will be necessary to construct two new buildings, one of stamping and another one to store the production,” a Nissan source says, adding the expansions will cover 377,000-sq.-ft. (35,000 sq.-m) five stamping presses will be installed where the Avila plant’s test track now is located.

The decision to end assemblies of NT400 (formerly called Cabstar) trucks is the result of a study commissioned Feb. 16 by Alan Johnson, Nissan Spain vice president-industrial operations. Parts production at the converted facility will be divided 70-30, de los Mozos says.

To keep their jobs at least for now, Nissan is requiring Avila workers to comply with the Renault-Nissan labor agreement for the Castilla y Leon region, a deal effectively limited to Renault because the French automaker has three plants in the region and Nissan operates only the Avila facility. The Avila plant will remain under Nissan management.

According to the works council of the Nissan plant in Avila, becoming subject to the Renault contract means a salary reduction of between 15% and 20%. Nissan has offered compensation bonuses and, for employees wishing to leave the company, an incentive of 50 salary-days per year worked.

The works council, which long has complained that Nissan Spain has emphasized car production at the expense of trucks, is not taking the news well.

“Incomprehensible and erratic decisions have been made by the company in recent years regarding the truck assembling, such as contracting the supply of components for trucks in China when they were manufactured in Spain, with the strong impact that this has on logistics costs,” a source says.

Defending Alliance officials’ decision to abandon truck production at the Avila plant located 85 miles (115 km) northwest of Madrid, de los Mozos says, “We have also considered continuing to assemble the NT400 beyond 2019, but in such a case Nissan will be forced to upgrade engines to comply with European emissions regulations, which have been advanced from 2023 to 2019, and this option is not economically viable.”

De los Mozos notes spare parts for the aftermarket generates 10% of the automaker’s annual income, and the Avila plant will assemble an estimated 80,000 pieces per month.

The decision marks the end of Nissan’s 40-year presence in Spain as a truck manufacturer, which was the main and almost exclusive activity of Motor Iberica – assembling trucks under the Ebro brand – when the Japanese company acquired its initial stake in the Spanish company in the late 1970s. Nissan took a controlling interest in Motor Iberica in 1980.