Keno Kato has been with Nissan Motor since 1988

Keno Kato has been with Nissan Motor since 1988

Keno Kato is corporate vice president of Global Product Strategy and Product Planning for Nissan and Infiniti. Glenn Brooks recently met him and took the opportunity to ask a variety of questions concerning future model plans.

j-a: I’d like to start by asking you about what’s ahead for Infiniti. One year ago at the New York show Infiniti announced that a plug-in model would be launched by April 2014. How close is that car from launch?

KK: I cannot make a comment, I’m sorry.

j-a: It’s only a year away, so is it still on schedule? Will it be a pure EV or has it evolved into a PHEV?

KK: Yes, the project is still moving forward but I cannot mention the technology.

j-a: As a rule, would a project such as this one be developed inside Nissan in Japan or would Alliance partners be involved?

KK: Like other car manufacturers, we have to look for efficiency improvements, so yes, sometimes there can be a partnership. There are lots of partnerships around high technology, and engines. So, in conclusion there is cooperation between Nissan, Renault and sometimes other partners for key future technology.

In the past, we have taken hybrid system components from Toyota but with this approach, it is not so easy to attract customers. Now, Nissan Engineering is leading that activity but in cooperation with external partners.

j-a: We know the Infiniti Q30, or Q40 (C segment vehicle that will be built in the UK from late 2014) will use Daimler’s MFA architecture. But will it have Renault-Nissan or Mercedes-Benz engines and gearboxes?

KK: Unfortunately, I cannot say right now. That information will be announced closer to the car’s launch.

j-a: Will it be a global product or just for Europe? Dongfeng Nissan has said it will launch two locally made Infinitis in 2014, so might this be one of them?

KK: That, we can say: this will be a global model, no question, it must be global. Premium customers expect global premium cars. So, it’s not our intention that this car will be for customers just in European countries. We will offer that car from the Sunderland plant, everywhere.

j-a: Will it be built in China too, or just in Sunderland?

KK: Ah…[laughing] I cannot disclose this information, I’m sorry.

j-a: Nissan, as we know, outsells Toyota in China so obviously you are always looking for ways to maintain that status quo. Dongfeng Nissan has just launched a new Teana, a version of North America’s Altima. As China’s Teana was formerly the same as North America’s Maxima, how will you replace the Maxima in all global markets?

KK: Very good question! Sharp, attacking question! [he grins] But…I cannot tell you (the answer). I cannot disclose.

j-a: OK, another question about Nissan in China: when will the long-wheelbase version of the new Teana be launched? Rumour has it we will see such a car at the Guangzhou motor show this November.

KK: Hmm [he smiles, pauses and considers]. Again, this is not something I can answer, I am sorry.

j-a: Toyota took many years to introduce Lexus to Japan but it’s now a major success there with over 7,000 cars sold in the first two months of this year. Why isn’t Infiniti available in Japan?

KK: I would say with Lexus in Japan, the success is not bad. But for Infiniti, I must explain some history. We could not, years ago, match the success of the Toyota Crown, and with respect I have to say, the latest model is a very good car. We have always battled the Crown. Before, with the Nissan Cedric and Gloria, and now we have the Fuga, which is Infiniti M for the US, Europe and China. So, there is the history.

But why did I mention the Crown to answer this question about Infiniti and Lexus? Because, the Crown has been selling very well - big, big volume and now in the top ten - and we have a competitor for this car with the Fuga. It is a different approach for us in Japan – we have Nissan there in the premium E segment.

j-a: Is it an age issue - the customer demographic - as to why there is no Infiniti brand? Big sedans tend to be bought as company cars for senior executives don’t they?

KK: These cars in Japan are for men aged 50 years or older. I’m 47 and those middle aged or senior people older than me, they make up the largest volume of car buyers in many countries and this is the same in Japan. The younger generation buyers do not support the sales of these cars.

j-a: Nissan ended 2012 in third position behind Honda in Japan, mostly because of the outstanding success of the N-Box, N-Box+ and N-One mini-vehicles. This year, it’s the same story after the first two months of sales. Why is Nissan continuing to rely upon Mitsubishi Motors and Suzuki to build its Kei models?

KK: I was in charge of the joint venture with Mitsubishi in my previous role. Yes, you’re right, Honda offers very attractive minicars and we will offer attractive minicars too. That’s the key to success in Japan. You will see more new Nissan models.

j-a: No doubt it is hard to make profits from low-priced cars in Japan, so pooling resources for Kei cars makes sense. But now that the yen has fallen, will you keep OEM outsourcing deals like this, and will you keep shifting production out of Japan?

KK: So, the weaker yen brings tons of benefits for exports from Japan. And imports of cars or components? No impact. Your question is about minicars. In product planning, there is no impact.

All car manufacturers try to escape from pain of currency problems. Our goal is not to have this pain. So, there are various solutions to avoid this. Minicar alliances are one way we can minimise the impact of currency movements.

We want to have a stable currency situation, but not just us. You will know that German manufacturers are successful importers to Japan and now the fall of the yen is a problem for them.

j-a: Is the decision to stop building the March (Micra) in Japan and instead import that car from Thailand with no hybrid derivative still the right decision? Its Japanese-made rivals the (Toyota) Aqua and (Honda) Fit rivals are selling in huge numbers but the March isn’t. Is that the reason?

KK: Building the March in Thailand and importing it to Japan is not a simple question. It depends not just on the exchange rate but the cost of components and where they come from. With this car, having a weaker or stronger yen is not the main issue.

j-a: From Thailand to another lower income market, but one where you are the long-time number one brand: how do you intend to replace the Tsuru, your best-seller in Mexico?

KK: Your question is really hard-core! [long pause] You’re right, replacing this car is a big activity. For me, Tsuru could last forever but this is not right for the customer. We have fuel economy pressure, safety technology pressure, etcetera, and we have massive activity around replacing that car.

j-a: The Tsuru has been around since the very early 1990s and sells on its low price. Nissan will have to make a big jump in costs to replace it. Those costs will have to be passed on to customers, won’t they?

KK: I have to respect the customer needs and that means the price position. We cannot change the price position. That’s a rule of the game. We will do our best, but as a consequence there might be some price increase, I don’t know. But the point is the customer is very demanding. If we do not respect the customer’s wishes, we will give [the] star position to other manufacturers.

j-a: There are very few national markets where Nissan is the number one brand, and also so far ahead of Toyota.

KK: I can imagine the feeling Toyota or Honda has about this situation. For them, unacceptable….unacceptable!...to see Nissan in this position in Mexico. We understand that feeling, and so Nissan has to work much harder than Honda or Toyota or Volkswagen to protect our champion position. This is very, very, very tough. Unbelievably difficult. But relatively easy [for rivals] to improve and climb up - slightly better, slightly better all the time - to reach the top.

j-a: You still haven’t said how Nissan will replace this big selling car, which must be very cheap to build after more than two decades of production.

KK: So, that is by keeping this position for Nissan, keeping the price competitive – then, you can imagine the future car. I cannot say any more than that. I do not want to help our competitors.

j-a: Could you imagine a situation in another emerging market where you would be given a Renault-Dacia platform and from that, create a low cost model? I’m talking about a future Datsun. Or a Nissan?

KK: Mmm, that’s a possibility. If that is the best way of addressing customer needs, I will take that (platform, and model). And I’m very open to protect competitiveness. I’m really open to this, but I cannot disclose our company’s plans.

j-a: Nissan is going to have a big presence in Brazil with a new factory, new models, a big push timed to coincide with the summer Olympics. Will you put products into that country which have your latest or even next generation technology? None of the Big Three - Fiat, Chevrolet and VW – seem to be doing that.

KK: This question is straight to the point! But it is difficult for me to answer.

j-a: You couldn’t give me a straight to the point answer? Nissan says it’s going to build a V platform model at the new Resende plant from the first half of 2014. Does that mean the Note, and surely a small SUV would follow?

KK: [smiles] I have a passion to give the best products for Nissan customers. I cannot say which model will be made in Brazil. But, this market is very important. Very important.