Speaking at the Nissan Supplier Meeting in Tokyo today, Carlos Ghosn, President & Chief Executive officer of Nissan, announced that the Nissan Revival Plan (NRP)’s commitments will be successfully achieved by March 2002, one year ahead of schedule.
Mr Ghosn said that all critical targets, including the 20% reduction in purchasing costs as outlined in the 3-year NRP, will also be reached a year earlier than planned.
Nissan will implement its new 3-year business plan, ‘Nissan 180’, a year ahead of schedule starting April 2002, he said. Nissan 180 will be a ‘comprehensive 3-year operational blueprint for Nissan’s continuing revival, calling for growth, profit and zero debt’.
Mr Ghosn also revealed the company’s new target of 15% purchasing cost reduction in three years within the context of Nissan 180.
Calling for continued support in Nissan’s revival process, Mr Ghosn acknowledged the strong contribution made by Nissan suppliers in partnership with Nissan’s Engineering and Purchasing Departments to arrive at the early achievement of the NRP commitments.
“Much of what has been done in reducing purchasing costs under NRP has been accomplished with already existing vehicles,” Mr Ghosn said. “Starting in FY2002, the renewal rate of our total portfolio of products worldwide will more than double compared to FY2000 and 2001. This means that a much greater number of cars to come will be designed and engineered with significantly lowered cost base and will benefit from higher economy of scale due to commonisation of platforms and components, reduction of complexity, and particularly from expected unit sales growth.”
Nissan will make public NRP’s results upon completion of fiscal year 2001, as it will unveil the multiple components of the Nissan 180 plan, in early FY2002.
The NRP, announced as a 3-year plan in October 1999, to turn Nissan to profitability, had committed to achieving net consolidated profit in FY2000, an operating margin of at least 4.5% and reducing net consolidated automotive debt to no more than 700 billion yen by the end of FY2002.
The ‘Nissan 180’ name symbolises the three goals Nissan will aim for in 3 years starting April 2002: 1) grow global unit sales by one million vehicles on an annualised basis by the end of FY2004 compared to FY2001’s base under reasonable macroeconomic conditions, 2) reach 8% operating profit margin to place Nissan in the top rank among global automakers, and 3) eliminate net automotive debt, which represents for Nissan the goal of becoming debt-free allowing for investment decisions based only on their return.