Nissan bites back

LAST week it launched the ‘Nissan drive to a million’ campaign, a marketing program based on the company’s commitment to accelerated sales growth in the global automotive market.

In Australia, it will add between $2000 and $3400 in extra value on many models in its passenger and commercial vehicle range between now and June, when the campaign finishes.

In an interview with GoAuto last week, Nissan Australia managing director and chief executive, Shinya Hannya, admitted the company had been caught off guard by the aggressive way in which its key competitors launched into sales this year.

Nissan’s market share in year-to-date terms is 6.0 per cent, down 0.6 per cent (or 690 vehicles) YTD. This is due to a softening in Pathfinder demand in the lead up to the replacement vehicle, as well as weaker interest in Maxima, 350Z and Patrol wagon.

Now Nissan plans to match its competition. "I’m happy but our start to 2005 could have been better," Mr Hannya said.

"If you look at the pure retail side we are doing okay. Everyone got very aggressive after Christmas. To be honest, they got more aggressive than we anticipated, so we were down slightly."With Nissan’s fiscal year, and its new retail campaign, starting this month, Mr Hannya believes the company will recover lost ground.

"After the first quarter we will have new product coming, so a solid sales campaign will move right into the new product launch," he said.

The campaign is one of the tenets in Nissan’s global ‘Value Up’ business plan, one of three three-year mid-term ideals to put Nissan on a secure global footing.

The first two three-year plans, the ‘Nissan Revival Plan’ and the ‘Nissan 180’ have now moved into phase three, the ‘Value-Up’ for 2005.

"It’s not very different from 180 but the aim is to sustain profitability at the top level but at the same time we want to sustain market share," Mr Hannya said.

Value-Up has three critical commitments relating to growth, sustained profitability and return on investment.

These include reaching annual global sales of 4.2 million units by the end of fiscal year 2007, maintaining an operating profit margin at the top level among global car-makers, and maintaining a minimum 20 per cent return on invested capital.

Mr Hannya admitted he fears any sense of complacency in his company ranks.

"We cannot stop because of pressure from HQ but also in this industry if you just stop you lose momentum. You cannot do that," he said.

"The business environment is good in Australia but interest rates could go up and exchange rates could change dramatically all of a sudden." In a global sense, rising commodity prices "which are good for Australia for resource mining exports" were also putting pressure on the auto industry and global economies, he said. The volatile oil price situation was also a concern.

"So there are many uncertainties, threats and risks for the future. It means that we have to be well prepared and see how we can do things better."That also means bringing the dealer network into the bigger Nissan picture.

"I think communication is the most important thing – and we haven’t been doing this in a systematic manner," he said.

"But I think it would be good if we can share the same mid-term goals of Nissan 180 ... and share that goal with the dealer group as much as possible."Last year Nissan Australia achieved fourth spot in overall sales and the title of top importer with a total of 63,654 sales.

In a growing market in 2004, which saw total sales increase five per cent to 955,229, Nissan achieved 8.7 per cent growth and a market share of 6.7 per cent, its highest annual share for 13 years.