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March 25, 2003

JAPAN: Nissan watching inventories to minimise war impact – report

Nissan said on Tuesday it would carefully monitor inventories to limit the impact from any downturn in demand due to the US-led war in Iraq, Reuters reported. Speaking at the opening of an engine museum and guest hall at its Yokohama plant, Nissan chief executive Carlos Ghosn said he wanted to see how the war will impact the total car market, especially North America, Reuters said.

By bcusack

Nissan said on Tuesday it would carefully monitor inventories to limit the impact from any downturn in demand due to the US-led war in Iraq, Reuters reported.

Speaking at the opening of an engine museum and guest hall at its Yokohama plant, Nissan chief executive Carlos Ghosn said he wanted to see how the war will impact the total car market, especially North America, Reuters said.

“For the moment, the contingency plans are mainly related to logistics in terms of how to better supply the existing markets,” Ghosn told Reuters. “We are obviously watching very carefully the levels of inventories in all the markets.”

The news agency noted that, last week, investment bank Goldman Sachs downgraded the outlook for Japan’s car making sector due to signs that the US economy would slow even if a war in Iraq were short-lived, while demand would also weaken in Europe and Japan. There are also concerns that a war could disrupt effective supply chain management at car makers, which is key to holding down costs as demand weakens.

Reuters said Nissan’s Ghosn, surrounded by reporters in front of a 1935 Datsun Roadster produced at its Yokohama factory, said the company must be flexible in management to adjust to a changing and tough environment.

According to Reuters, the Nissan chief said the war would not delay this year’s opening of its Mississippi assembly plant in the US, which is expected to produce a full-size pickup, two sport utility vehicles, a minivan and a sedan.

“The plant in Mississippi would start production on time,” Ghosn said, according to Reuters. “Whatever happens in the environment, it will not have an impact on the schedule of the launch of the different products and the ramp up of the plant in Mississippi.”

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