Tokyo - February 8 - Speaking before approximately 650 suppliers at 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, a year ahead of schedule. In line with this, 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. The company, as a consequence, decided to 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 context of NISSAN 180, in which purchasing cost reduction is one facet. Planning is currently underway for its full implementation incorporating a wide range of action plans from the acceleration of new model introductions to the development of new technologies, as well as further cost reductions necessary in distribution, R&D, and administrative costs.
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. Referring to Nissan 3-3-3 that calls for such partnership, Mr. Ghosn said it is critical to seek increased contribution from this initiative, from the current 33% to 50%.
"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 increase significantly 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 form higher scale due to commonization of platforms, components and growth."
Nissan will make public NRP's results upon completion, as it will 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 percent, and reducing net consolidated automotive debt to no more than 700 billion yen by the end of FY2002.
As for the NISSAN 180, its name symbolizes the three goals Nissan will aim for in 3 years starting April 2002: 1) grow global unit sales by one million vehicles on an annualized 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.
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