They had to cut down somewhere but I did not reckon it will come in the form of killing the repair program. Is it going to make big difference in their costs? I can't get the reasoning behind this. Their service as it stands now isn't spectacular or fastest in the world and this would only make it worse. And they are extremely twitchy about grey market repairs any way.
This is a great improvement- NOT! Service has been slow to pathetic.
I laughed when they said "As a result, Nikon needs to ‘change the manner in which we make product service available to our end-user customers." They most certainly need to change the manner for the better (doubtful)!
I read complaints about the service from Olympus and Panasonic- they have been far better (esp. Olympus) than Nikon.
One of Nikon's excuses, back in 2012 when they shut off parts to some repair shops, was "We are the only ones capable of fixing these complex cameras and lenses." To some extent that was true, given they use some specialized shaking table to calibrate their lenses that were VR capable. For other minor things like replacement leatherette, battery doors, etc. not so good. Actually, some independents often did a better job given the owner's name was on the repair and not someone working for the major who may care less.
Now it could be that Nikon does not want to pay the independent shops a fair value for doing a repair. When we had a Sony TV dealer here who also did warranty repairs, when ours broke the owner said, "He would not fix it under warranty as Sony didn't pay him enough to bother with it and the paperwork so I should send it off to LA to get fixed. If we wanted to pay him directly, he would order the parts and install them, but no warranty." Interesting, and why I refuse to buy a Sony camera too as their service isn't great either ( Sony Service Scorecard ), aside from them changing things too much and too often so even parts might become an issue as they frequently dump and move on. Our new $3K Sony TV we have (groan!) is basically a replacement refurb if within its warranty period, otherwise it's off to the dump once out of it.