Nissan currently has a manufacturing headquarters in Smyrna and an engine plant in Decherd and employs more than 7,000 people in Tennessee. Nissan's plant in Smyrna was built in 1980 as the company's first factory outside Japan. Altima cars, Xterra and Pathfinder sport utility vehicles and Frontier pickups are manufactured there.
Nissan was one of the first of several major carmakers _ DaimlerChrysler AG's Mercedes division, BMW AG, General Motoros Corp.'s Saturn unit, Toyota Motor Corp. and Hyundai Motor Co. _ to build plants in the Southeast. The region remains one of the cheapest areas to do business in the country because of low taxes, wages and real estate costs.
Tom Libby, an automotive analyst with JD Power and Associates, said Nissan's relocation could make other Japanese automakers in Southern California _ Honda Motor Co., Mitsubishi Motors Corp. and Mazda Motor Corp. _ consider moving.
Jack Kyser, chief economist at the Los Angeles Economic Development Corp., said another 1,500 jobs would be lost outright or affected by the move, including accounting services, legal service, advertising and similar industries.
The relocation announcement comes as Nissan continues a robust growth track after losing money for several years.
Before setting up an alliance with Renault SA of France in 1999, Nissan was on the verge of collapse but has since come back under the leadership of Ghosn, sent in by Renault, who closed plants and cut costs.
Nissan has forecast a sixth straight year of record profit for the full fiscal year through March 2006.
The company is expecting about $4.6 billion net profit for the fiscal year ending March 31, 2006, on $80.8 billion in sales.
Shares of Nissan rose 13 cents to close at $20.01 Thursday on the Nasdaq Stock Market.
Associated Press writers Lucas L. Johnson II in Nashville and Gary Gentile in Los Angeles contributed to this report.