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Nissan (NSANY) to Augment Vehicle Production in China by 40%
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By 2021, Nissan Motor Company (NSANY - Free Report) plans to expand its vehicle manufacturing capacity in China by 40%, per Reuters. For this, the company will invest $900 million, part of $8.73 billion allocated to expand its footprint in China.
Over the next few years, Nissan, along with its joint-venture (JV) partner, DongFeng Motor Group Co., Ltd. (Dongfeng), aims to invest approximately $900 million for capacity expansion. Except for manufacturing Nissan’s passenger cars at its two existing facilities, the JV is expected to create a new manufacturing hub at Wuhan, where Dongfeng is headquartered. If construction of the planned hub gets approved from China’s regulators, the plant is likely to produce around 300,000 vehicles per year.
The expanded capacities will be used to manufacture Nissan and its China-only Venucia brand’s electric vehicles (EVs) as well as cars with gasoline engines.
The site expansion will facilitate Nissan to reach its production target of 2.1 million vehicles per year in China. Earlier, in 2017, the company sold 1.5 million units. It aims to reach a yearly target of 2.6 million vehicles by 2022.
Over the past 20 years, the majority of China’s market share has been held by General Motors Company and Volkswagen AG, each selling roughly 4 million vehicles in 2017.
Earlier, in February, Nissan strategized a five-year plan, known as Triple One, to raise its market share in the world’s largest automotive market by focusing on EVs and Venucia. Additionally, the company aims to improve its light commercial vans and trucks sales. Per Nissan China’s management, the company aspires to gain a position in the top 3 automakers of China.
In the past six months, Nissan’s stock has lost 8.6%, outperforming 11.1% decline recorded by the industry it belongs to.
Zacks Rank & Other Key Picks
Nissan currently carries a Zacks Rank #2 (Buy). Some other top-ranked stocks in the auto space are Fox Factory Holding Corporation (FOXF - Free Report) , Allison Transmission Holdings, Inc. (ALSN - Free Report) and PACCAR Inc. (PCAR - Free Report) . Fox Factory and Allison Transmission sport a Zacks Rank #1 (Strong Buy) while PACCAR carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Fox Factory has an expected long-term growth rate of 16.8%. Shares of the company have risen 65.6% in the past three months.
Allison Transmission has an expected long-term growth rate of 10%. Over the past three months, shares of the company have gained 10.4%.
PACCAR has an expected long-term growth rate of 11.6%. Over the past three months, shares of the company have gained 3.8%.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Nissan (NSANY) to Augment Vehicle Production in China by 40%
By 2021, Nissan Motor Company (NSANY - Free Report) plans to expand its vehicle manufacturing capacity in China by 40%, per Reuters. For this, the company will invest $900 million, part of $8.73 billion allocated to expand its footprint in China.
Over the next few years, Nissan, along with its joint-venture (JV) partner, DongFeng Motor Group Co., Ltd. (Dongfeng), aims to invest approximately $900 million for capacity expansion. Except for manufacturing Nissan’s passenger cars at its two existing facilities, the JV is expected to create a new manufacturing hub at Wuhan, where Dongfeng is headquartered. If construction of the planned hub gets approved from China’s regulators, the plant is likely to produce around 300,000 vehicles per year.
The expanded capacities will be used to manufacture Nissan and its China-only Venucia brand’s electric vehicles (EVs) as well as cars with gasoline engines.
Nissan Motor Co. Price and Consensus
Nissan Motor Co. Price and Consensus | Nissan Motor Co. Quote
The site expansion will facilitate Nissan to reach its production target of 2.1 million vehicles per year in China. Earlier, in 2017, the company sold 1.5 million units. It aims to reach a yearly target of 2.6 million vehicles by 2022.
Over the past 20 years, the majority of China’s market share has been held by General Motors Company and Volkswagen AG, each selling roughly 4 million vehicles in 2017.
Earlier, in February, Nissan strategized a five-year plan, known as Triple One, to raise its market share in the world’s largest automotive market by focusing on EVs and Venucia. Additionally, the company aims to improve its light commercial vans and trucks sales. Per Nissan China’s management, the company aspires to gain a position in the top 3 automakers of China.
A few days back, another Japanese automaker, Toyota Motor Corporation announced its plan to expand capacity at its Tianjin and Guangzhou plants in China. (Read more: Toyota to Expand Guangzhou & Tianjin Hubs' Capacity in China)
Price Performance
In the past six months, Nissan’s stock has lost 8.6%, outperforming 11.1% decline recorded by the industry it belongs to.
Zacks Rank & Other Key Picks
Nissan currently carries a Zacks Rank #2 (Buy). Some other top-ranked stocks in the auto space are Fox Factory Holding Corporation (FOXF - Free Report) , Allison Transmission Holdings, Inc. (ALSN - Free Report) and PACCAR Inc. (PCAR - Free Report) . Fox Factory and Allison Transmission sport a Zacks Rank #1 (Strong Buy) while PACCAR carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Fox Factory has an expected long-term growth rate of 16.8%. Shares of the company have risen 65.6% in the past three months.
Allison Transmission has an expected long-term growth rate of 10%. Over the past three months, shares of the company have gained 10.4%.
PACCAR has an expected long-term growth rate of 11.6%. Over the past three months, shares of the company have gained 3.8%.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>