Nissan chief executive Carlos Ghosn has said that the company needs to correct a ‘big imbalance’ in its costs and revenues due to making cars in Japan that are then sold in the US and dollar-linked economies in Asia.
Ghosn was addressing currency concerns in an interview with the Financial Times, a theme that he and others at Nissan have publicly returned to several times in recent weeks.
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“What we (want) to do is shift more of our cost from a yen base to a dollar base,” Ghosn told the newspaper, adding that while this would not mean closing down facilities in Japan, the company could not expand there.
Last week, executive vice president Colin Dodge said that Japanese carmakers will continue to suffer from a strong yen next year although China will bolster the company’s performance in 2011.
Dodge said China will continue to be “amazing” in 2011, but the yen would give Japanese automakers the biggest problems, forcing Nissan to take more steps to reduce exposure with the dollar far below the automaker’s comfort zone of around 95 yen.
Ghosn told the Finance Times that exchange rate volatility of any kind was damaging to business because it undercut long-term strategy.
“The only way you can protect yourself is by making sure your currency footprint is balanced. If there is any imbalance, it should be small,” he said.
Ghosn contrasted the position at Renault, which is relatively well-balanced in terms of the match between its cost base and its sales, with Nissan, which has “an unbalanced footprint, and the big imbalance is the yen to the dollar.”
