Nissan Is Betting on ‘China Speed’ to Get Back on Its Feet
Nissan Motor Co. is counting on China to turn its fortunes around after headwinds in the U.S. and Japan left the automaker searching for a way to get back on its feet.
The Japanese auto company is pushing ahead with a growth plan for China that calls for annual sales to reach 1 million cars by the end of the decade, and beyond that to export hundreds of thousands of vehicles from factories in the country to other parts of the world.
In 2003, Dongfeng Motor Group Co. Nissan, which took the lead in China after partnering with and achieved success with the Sylphy sedan, saw its sales volume drop by almost half after new ventures in the country’s electric vehicle sector won over buyers. Despite this, Nissan believes the know-how and relationships developed over two decades will still give it an advantage.
“The pace of change is accelerating,” Stephen Ma, president of Nissan’s China operations, said in an interview at the Beijing Auto Show on Friday.
It’s a pretty ambitious plan, considering brands in the US, Europe and Japan are rapidly losing ground to local competition. But surviving in China may be Nissan’s best chance for a recovery after struggling to boost sales following an aging staff and management turmoil following the 2018 arrest of former Chairman Carlos Ghosn.
Ma said Nissan has kept pace with the Chinese by spending two years to develop each model in its latest lineup, while older brands typically need four to five years. “24 months is already the Chinese speed,” he said.
BYD Co., Geely Automobile Holdings Ltd. and other local EV manufacturers have significantly reduced the time required to design, develop and bring to market new battery-powered cars with advanced software
According to Ma, Nissan’s China sales increased for the first time in seven years in the last fiscal year; increased by 4.5% in the second half compared to the previous year. Nissan plans to introduce five more models in the country next year; These models will complete the lineup promised last year, which includes 10 new cars, from fully electric sedans to plug-in hybrid trucks.
Chief Executive Ivan Espinosa said that in addition to selling one million cars a year in China by 2030, the goal is to export vehicles produced in China (first 100,000 units, then 300,000 units) to other markets, a strategy not adopted before.
The N7 electric sedan will be shipped to Latin America and Southeast Asia, and the Frontier Pro utility vehicle will be sold in these two markets as well as the Middle East. Its newest model, the NX8, will also be exported in the near future, but executives declined to comment to which markets.
In early April, Nissan announced a major refresh of its aging product line-up and outlined new sales targets for the US and China. Espinosa said the automaker plans to reduce its model count from 56 to 45 and allocate 80% of its volume to three main “families” of vehicles built on common platforms.
“We have learned our lesson on how to survive in China,” said Isao Sekiguchi, a Nissan executive and general manager of Dongfeng Nissan Passenger Car Company.
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