Nissan Motor Co. has ditched plans to bring a subcompact electric crossover to the U.S.

The financially hamstrung automaker told suppliers that it won’t build the electric vehicle — code-named PZ1L — at its plant in Canton, Miss., sources tell Automotive News. Instead, output is expected to be consolidated at Nissan’s factory in Sunderland, England, according to AutoForecast Solutions.

Nissan spokesperson Brian Brockman said the automaker is focusing on other EV projects for the Canton plant that would better meet market needs and deliver higher volumes.

“We will continue to evaluate market opportunities for new models and make adjustments accordingly,” Brockman said.

Sign up for the Automotive News Retail Roundup newsletter, delivered every Tuesday, featuring the latest auto retail news including dealership technology, best practices, and online retailing.

The PZ1L, described as being sized between the Leaf hatchback and the compact Rogue crossover, was one of five Nissan and Infiniti brand electric sedans and crossovers planned to be built in Canton starting mid-decade.

But last summer, the Japanese automaker told suppliers it was pausing production plans for the next-generation EVs in Canton and putting a $500 million investment at the underutilized assembly plant on hold.

Nissan sent a memo to suppliers at the time saying it had adjusted the sedans’ “development schedule ... to enhance product competitiveness.”

Being pragmatic

EV demand in the U.S. has softened from its post-pandemic fervor fueled by the technology’s early adopters.

Like much of the industry, Nissan is taking a wait-and-see approach with its electric plans — assessing customer demand for zero-emission vehicles and potential changes to EV incentives under President Donald Trump‘s administration.

“We have an industry volume forecast that has a percentage of [hybrids], a percentage of [plug-in hybrids] and a percentage of EV,” Ponz Pandikuthira, Nissan Americas chief planning officer, told Automotive News in October. “That number is a little too dynamic for my liking at this point.”

Former Nissan Americas Chairperson Jeremie Papin said the automaker was being “pragmatic and reactive” to customer interest in EVs.

“What matters is making sure that we launch the vehicles that the customer wants, at the time the customer wants it,” Papin told Automotive News in May.

Prioritizing

The PZ1L was one of three electric utility vehicles planned for Canton.

Nissan added the model to the production mix in May, but since then its financial fortunes have worsened amid tumbling sales and profitability.

Nissan Group’s U.S. market share fell to 5.8 percent last year, down 2.1 percentage points from five years earlier, according to the Automotive News Research & Data Center. Reduced throughput dragged Nissan dealership profitability in 2024 to its lowest level in nearly 15 years.

That has necessitated a global cost-cutting effort and a potential business tie-up with Honda Motor Co.

In November, the automaker lowered its outlook for full-year operating income by 70 percent while revealing plans to axe 9,000 jobs and slash 20 percent of its global manufacturing capacity.

Sam Fiorani, vice president of AutoForecast Solutions, said another compact electric crossover would add to the saturation of a segment already crowded with entrants from Hyundai, Kia and Volkswagen.

Last year, U.S. sales of 10 compact electric crossovers topped 200,000 vehicles, with only three selling more than 20,000.

“It’s tough to make money on volumes that low,” Fiorani said. “Too many EVs are chasing too few buyers at the moment, and Nissan’s resources would be better spent on adding hybrids to its lineup.”