Nissan is reportedly gearing up to end production at its plant in Wuhan, China, due to dwindling production of the Ariya and X-Trail, which are built there. This is bad news for the Japanese brand and comes just a few days after it was revealed it will soon announce its biggest ever financial year loss.

News of Nissan’s plans first came from a local Chinese outlet. It’s understood that annual production at the plant has only hit 10,000 units since operations commenced in 2022. That’s pretty terrible, particularly since the plant has the capacity to build as many as 300,000 vehicles annually. Nissan is currently leasing the site from Dongfeng Motor.

Nissan’s Chinese Sales Were Way Off Target

Reuters understands that stiff competition from Chinese companies is a key reason why production has never come close to reaching capacity.

Read: Nissan’s New Frontier Pro Plug-in Hybrid Wants To Take On The World

This isn’t the only Nissan plant in China that’s under serious pressure. In June last year, it closed its plant in Changzhou due to the jump in sales of Chinese EVs and dwindling demand for imported vehicles. This site had been operating alongside Dongfeng Motor since November 2020 and had the capacity to build 130,000 vehicles annually.

Nissan’s Is Between A Rock And A Hard Place

Nissan is in dire straits at the moment. We’re only a few months removed from its planned merger with Honda falling apart, and on May 13, it’s gearing up to release its full earnings report for the fiscal year that ended in March.

Last week, the automaker said it expects to report a net loss of ¥700-750 billion ($4.91 – $5.26 billion) for the year, a huge increase from the ¥80 billion ($560 million) net loss it originally estimated.

Nissan is currently in survival mode and is implementing a massive restructuring. It has confirmed plans to cut 9,000 jobs, is closing plants, and has streamlined model lineups. It is also looking for a new partner, and could even join forces with Taiwanese tech giant Foxconn.

Nissan is currently in survival mode and is implementing a massive restructuring. It has confirmed plans to cut 9,000 jobs, is closing plants, and has streamlined model lineups. It is also looking for a new partner, and could even join forces with Taiwanese giant Foxconn.