Nissan to reboot Xterra SUV as a hybrid, freezes plans for US EV

[DETROIT] Nissan Motor will revive its Xterra SUV as a hybrid model to be built in Mississippi and halt plans to make an electric vehicle (EV) in the US, according to its top executive for the Americas.

The Japanese carmaker will reboot the Xterra nameplate in 2028 as a V6 engine-powered hybrid to help fill unused capacity at its plant in Canton, Mississippi, said Christian Meunier, chairman of Nissan Americas. It’s also considering building an upscale Infiniti brand version of that model and moving the full-size Armada and Infiniti QX80 SUVs to the factory.

“The dealers are super excited about it because it’s going to be a great example of Nissan coming back,” Meunier said on Tuesday (Sep 30), adding it will “bring scale back to the plant and get the costs at the right level”.

Nissan is undergoing a massive downsizing effort globally as it tries to regain profitability, but in the key US market, it’s planning to boost gas-powered vehicle output in response to US President Donald Trump’s trade and environmental policies.

The once-popular Xterra was discontinued in the US a decade ago due to tougher emissions standards and a broader industry shift away from boxier, truck-based SUVs.

As part of the shift, Nissan has frozen plans to make a fully-electric model in Mississippi as US demand for EVs has softened, and may drop further with the expiration this month of federal subsidies. As recently as March, Nissan had said it was on track to launch a battery electric model in Canton in 2028 and planned to source batteries for it locally from South Korea’s SK On.  

The carmaker currently imports EVs such as the Leaf model to the US from Japan, but has reduced those volumes due to tariffs. Nissan continues to mull options for making EVs in the US, but Meunier said that may hinge on dramatic cuts to manufacturing costs or finding a partner to split the risk.

“With the market being very uncertain about EVs, I think it’s the right thing to do,” he said.

Meanwhile, it’s readying a new version of its entry-level, Mexican-made and gas-powered Sentra compact sedan for launch in the US later this year and a plug-in hybrid option for its best-selling Rogue compact SUV in early 2026. The company is hoping those models bolster sales in the US, which slid 6.5 per cent in the second quarter and were flat in the first six months of the year. On Wednesday, Nissan will release US deliveries for the most recent quarter to September.

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Meunier said that the revamped Xterra will share a platform, hybrid powertrain and parts with the midsized Frontier pickup, Pathfinder SUV, Infiniti QX60 and possibly another as-yet-unnamed Infiniti SUV.

Nissan’s other US vehicle assembly plant in Smyrna, Tennessee, was set to go down to a single work shift earlier this year, but the carmaker decided to maintain two production shifts daily after the Trump administration imposed tariffs. Meunier, who rejoined Nissan in January after a stint at rival Stellantis NV, said he hopes to add a third shift in Smyrna once an all-new version of the Rogue debuts.

While the White House’s tariffs have injected uncertainty into the auto industry and upended supply chains, the Nissan executive said that the tough trade regime has injected a needed sense of urgency into Nissan’s attempted makeover of its US operations.  

“I keep saying it’s a good thing for Nissan, it forces us to rethink, he said. “It forces the company to do the right thing. When you think about a big market like the US, you need to be localised.” BLOOMBERG