Nissan-Chrysler Small Car Put on Hold

Nissan and Chrysler yesterday announced that they decided to put on hold a joint venture to develop a small car and a full-size pickup to be sold in North America, citing the economic recession as the reason. Aside from this, a rebadged version of Nissan Versa sedan will still be produced by Chrysler, the two companies said according to Autonews. Basically, the two automakers paused their project to share the North American models because the economic downturn altered the market condition and reduced interest in such models.

"Because of current economic conditions, Nissan and Chrysler teams working on the two other projects have been asked to ensure that financial objectives for both companies can be met before these two projects move forward," Nissan North America Inc. announced in a press statement.

In essence, the paused plans included the next-generation Nissan Titan and a Nissan B-segment model that was based on a Chrysler concept and design, the source wrote.

Nissan confirmed in late January that it plans to restructure its North American operations as part of a broader plan to counteract the crisis and align production with market demand.

“NNA is restructuring its sales and marketing field operations to be better positioned to serve dealers and consumers. Specific actions include transitioning from a field structure based on 11 regional sales offices to a new structure with seven regional sales offices and 23 satellite offices in 18 locations across the United States,” Nissan said on January 27.

Even though the American automaker recently announced a global strategic alliance with Italian company Fiat, the Chrysler-Nissan alliance denied rumors that the paused models are somehow related to the agreement, Autonews wrote.

"Earlier this year, due to the current economic conditions, Nissan and Chrysler leadership directed their teams… to improve the financial objectives for both companies before the projects move further forward,” Chrysler said in a statement rolled out on Thursday.