Nissan Turnaround Plan: Recovery in the Post-Ghosn Era

Does Nissan want to withdraw from Europe? Ashwani Gupta, Nissan's chief operating officer, said he would not. He emphasized: 'For us, Europe is a very important market. However, unlike China, Japan and the United States, it is not a ‘core’ market. This is a key difference.'

Part of the reason for this situation is that European consumers have abandoned Nissan. In 2017, the brand registered 566,191 vehicles in Europe, and its Qashqai and Juke models made crossovers popular. Two years later, in the year before the outbreak of the new crown virus, the brand's sales in Europe plummeted to 394,091. This year, the overall European car market was very stable.

With the end of the era of former CEO Carlos Ghosn, Nissan’s problems are not limited to Europe. The company’s goal is to increase its profit margin to 8% and gain 8% of the global market share. In the last fiscal year, Nissan’s market share was 5.8% and recorded 40 billion yen (approximately 300 million pounds). In addition, the company also spent more restructuring costs.

Gupta, who graduated with an engineering major and later transformed into an operations expert, said: “We are expanding too fast around the world. We originally thought that the global auto market would usher in growth, so Nissan’s sales performance would also be very good. However, neither of these two things happened. As a result, we were troubled by the aging of the models, and we were unable to maintain a large model lineup. Everything depends on investment: if there is no income, no new models can be released. This is a vicious circle. Therefore, Nissan’s solution is to become more rationalized.'

So the company proposed the Nissan Next turnaround plan. As the company's main performance monitor, 50-year-old Gupta participated in all aspects of this plan. The plan sets Nissan's goals before 2023: cutting costs, closing factories in Spain and Indonesia, discontinuing production of all models including the Russian Datsun series, and working more closely with alliance partner Renault. Simply put, Nissan is cutting expenses to adapt to the company's declining market position.

The rationalization plan comes from Nissan’s analysis of its potential in each market. Gupta said: 'After analysis, we found that the United States, China, and Japan are our largest markets. In the United States, our market share exceeds 7%, and in Japan and China, it exceeds 10%. In addition, we can make a profit in China and Japan. , And in the United States, we feel that the company has the potential to make a profit.'

Gupta is no stranger to Europe. He has attended universities in Southampton and Sheffield. He also lived in Paris for 8 years while working in the league. He called the Nissan Sunderland plant a 'great factoryHe said that these are great infrastructures, but not enough to elevate Europe to the core position of Nissan's business.

He said: 'The total scale of the European automotive industry is 15 million. This is a big market. But our market share is only 2.5%. We can’t cover everything, so we decided to focus on our advantages. In Europe , Our advantage is the crossover models: Qashqai, Juke and X-Trail. In addition, in terms of technology, we will develop electric, autonomous driving and connected car technologies.'

Next year or so, three key new models will go on sale in Europe: the third-generation Qashqai, the 7-seater version of Qijun, and the pure electric version of Ariya. The latter will continue to cultivate on the basis of the Leaf. Pure electric market.

In 2023, half of the cars sold by Nissan in Europe will be electric models: First, the next-generation Qashqai will be equipped with ePower extended-range hybrid technology. Qijun will also use the same plug-in hybrid chassis as Mitsubishi's new Outlander.

However, the next-generation Z series sports car is not equipped with low-emission technology, which means that the car will not be sold in Europe. Gupta admitted: “Europe is a market that challenges us in terms of technology (especially in terms of environmental compliance).” Currently, the annual sales of Nissan’s Z-series models in Europe is approximately 500, which is consistent with the number of vehicles in Europe. Sales in Japan are roughly the same. The company's upcoming new Z will be equipped with a twin-turbocharged V6 engine. The new car will be mainly targeted at the US market, where sales in the United States are approximately 4 to 6 times that in Europe.

As for Micra, due to the leader/follower development strategy proposed by the Renault-Nissan alliance, the new Micra will be closely related to Renault's Clio in the future. Nissan will focus on the development of electric vehicles, sports cars and large cars, while Renault will lead the development of B-class cars and trucks.

Gupta said: 'We do not have the strength to invest, so we will seek help from Renault, which is very strong in these market segments. This is what we call the priority and focus. Meaning. All of this is to gain a 6% market share within 3 years and allow Nissan to regain a foothold.'