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DONGFENG MOTOR CO., LTD., ANNOUNCES MIDTERM BUSINESS PLAN

Plan 2³ will guide doubling of sales and operating profit by end of 2007
DONGFENG MOTOR CO.,LTD., ANNOUNCES MIDTERM BUSINESS PLAN

BEIJING, CHINA (November 24, 2003) - Today Dongfeng Motor Co. President and CEO Katsumi Nakamura unveiled the new company's four-year business plan, which is effective for 2004 through 2007.  Through Plan 23  [Plan Two Cubed], the company aims to double its current unit sales and revenue, to achieve a double-digit operating profit margin, and to use the expertise of its two partners - DongFeng Motor Corporation (Dongfeng: holding company of Dongfeng group) and Nissan Motor Co., Ltd. (Nissan) - to establish unique competitive strengths.

 "The mid-term business plan of Dongfeng Motor Company has been formulated based upon the trends and developments of the international and domestic economies, and the structure of the Chinese auto industry, leveraging the wealth of resources available within the new company"  said Chairman Miao Wei.

 "We aim to create value and profitable growth as we establish Dongfeng Motor Company as a globally competitive automotive manufacturer,"  said President Nakamura.   "We have developed a comprehensive, full-line manufacturer that will benefit from the complementary strengths and experience of both Dongfeng and Nissan." 

The midterm business plan is comprised of three main elements: significant growth, operational enrichment and organizational learning.

Dongfeng Motor Co. sales are forecasted to grow from 300,000 vehicles in 2003 to 620,000 vehicles in 2007.  Growth is linked to competitive new products and model changes, enhanced research and development capabilities, and improvements in sales and service quality management.  A series of minor and major model changes are planned for the truck lineup during the next four years, and technological cooperation agreements have been signed with Nissan Diesel and Volvo's Renault Truck Division to develop product enhancements, such as an all-new truck cabin and larger-capacity engines.  Six new Nissan-branded passenger vehicles will be launched in China by 2006, including the Sunny sedan, which was launched in July 2003.

Operational enrichments will emphasize cost competitiveness throughout the entire value chain and quality improvements.
For example:

Purchasing will be centralized for all of the company's operations, and purchasing cost activities will be accelerated for commercial and passenger vehicles, including increased localization.

Manufacturing production process improvements and activities to boost productivity and quality are planned for all Dongfeng Motor's production hubs.  Current production facilities will see a significant increase in rationalization and capacity usage.  Employee headcount will remain stable during the four years of the plan.

Organizational learning is linked to the implementation of global management practices on a company-wide basis.  Human Resources systems will be enhanced to support educational training and performance-based appraisals and rewards.  The exchange of technical experts and best practices will serve to strengthen capabilities and enhance Dongfeng's overall performance.

 "We must engage our people fully to bring out their very best performance as we move ahead,"  said Nakamura.   "I am asking every employee to take this opportunity to make Dongfeng a world-class, competitive automotive company." 

DFL operations began on July 1, 2003.  Sales revenues for the second half of this year are forecasted to reach 17 billion RMB (224 billion yen, $2 billion U.S.), yielding an 8% operating profit margin.

In 2007, the last year of the plan, sales revenues are forecasted to reach  80 billion RMB (1,054 billion yen, $9.6 billion U.S.), which is more than double the level of performance in 2003.  Operating profit is expected to reach 8 billion RMB (105 billion yen, $1 billion U.S.), which is 10% of sales.

Dongfeng Motor Co., Ltd., was established as a result of a comprehensive, strategic partnership between Dongfeng and Nissan.  Registered capital of the new company is 16.7 billion RMB (approximately 220 billion yen, $2 billion U.S.), with Dongfeng and Nissan each holding 50% of equity.  Dongfeng is making a series of capital contributions in the form of existing assets and, corresponding with Dongfeng's contributions, Nissan is making its capital contribution in cash.  The new company inherited DongFeng's key existing automotive businesses and operations, including trucks, buses, light commercial vehicles and passenger vehicles.

Note: Amounts in RMB are translated for the convenience of the reader only at the rate of 1 RMB per 13.18 Japanese yen and 1 RMB per 0.12 U.S. dollar, based on the exchange rates in effect as of November 21, 2003.

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