- New organizational structure to lead through downturn -
TOKYO, Feb. 9 /CNW/ - Nissan Motor Co., Ltd. (NML), today announced
recovery actions designed to enhance the company's performance during the
current global economic and financial crisis. The company also revealed a new
organizational structure to guide Nissan through current challenges and
support its future direction.
New recovery actions
Despite actions already taken during 2008 to respond to the global
crisis, worsening conditions are prompting the need for further changes to the
company's cash management strategy, business structure and investment plans.
Countermeasures include the following:
- In order to focus on recovery actions, our 2008-2012 midterm business
plan, Nissan GT 2012, will be suspended, but commitments on quality
and zero-emission vehicles will be retained.
- Labor costs will be reduced in line with the decrease in revenues.
During FY2009 labor costs in high-cost countries will be reduced by
20%, from 875 billion yen to 700 billion yen.
- Bonus payments to the board of directors will be eliminated for
FY2008. Starting in March and until the situation clearly improves,
salaries paid to board members and corporate officers will be reduced
by 10% and those paid to managers in NML and affiliate companies in
Japan by 5%.
- Nissan will negotiate the implementation of a work sharing scheme for
staff workers, to be announced by the end of the fiscal year.
- Global headcount will be reduced by 20,000 through FY2009, reducing
Nissan's headcount from 235,000 to 215,000.
- Inventory will be tightly controlled. In March 2008, company and
dealer inventory was 630,000 units; that level will be reduced by
20%, to 480,000, by March 2009.
- Production will be right-sized through changes such as shift
elimination, non-production days and shorter working hours. These
actions will reduce global production by 787,000 units - a 20%
decrease compared to planned volume - by the end of this fiscal year.
- Capital expenditure reductions will result in a 21% contribution to
saving cash by the end of FY2008 compared to FY2007. An additional
reduction of 14% will be made in FY2009, taking overall capital
expenditures from 384 billion yen in FY2008 to less than 330 billion
yen in FY2009.
- Joint manufacturing projects with Alliance partner Renault in Morocco
and India will be revised. In Chennai, India, the joint plant will
proceed with a reduced ramp-up speed. In Morocco, Nissan will suspend
its participation in the industrial project near Tangiers.
- The product portfolio will be revised, including the cancellation of
selected future programs. Nissan will launch an average of 10 all-new
vehicles per year in the 2009-2012 period, including the company's
all-new, A-Platform entry-car lineup and a dedicated all-electric
- By improving working capital, mainly accounts payable and receivable,
Nissan will generate 130 billion yen of cash in FY2009.
- A detailed review is ongoing to identify deeper synergy opportunities
within the Renault-Nissan Alliance. The focus is on future
investments in products, technology, support functions and purchasing
cost reductions. Each company will contribute to free cash flow with
a minimum of 90 billion yen (750 million euros) in synergy benefits
New organizational structure
In addition to actions being taken to streamline its business, Nissan is
announcing changes to its executive management structure in order to provide
an enhanced focus on both regional and functional activities. The changes are
Toshiyuki Shiga, Chief Operating Officer, expands his responsibilities to
include management of a newly created three-region structure, in addition to
manufacturing, research and development, purchasing, product planning, design,
and marketing and sales. Shiga continues to report to President and CEO Carlos
Colin Dodge is appointed to the newly created position of Chief Recovery
Officer, reporting to Ghosn. In this position, Dodge will lead the company's
ongoing recovery activities, and he also assumes responsibility for the
corporate planning and control functions. Dodge is leading the newly created
region encompassing Africa, the Middle East, India and Europe.
Hiroto Saikawa, Executive Vice President, takes responsibility for a new
region that is comprised of Japan, China and the Asia-Pacific markets. Saikawa
retains his responsibility for purchasing and adds responsibility for the
Carlos Tavares, Executive Vice President, is responsible for a new region
that consolidates all markets in North, Central and South America.
Andrew Palmer is appointed Senior Vice President with responsibility for
product planning, the Infiniti business unit, the Light Commercial Vehicle
business unit and a newly created electric vehicle business unit. Palmer is
newly elected to serve on Nissan's Executive Committee.
In addition to those named above, the Nissan Executive Committee includes
the following executives:
- Alain Dassas, Chief Financial Officer (reports directly to Ghosn);
- Junichi Endo, Senior Vice President, Global Sales and Marketing;
- Hidetoshi Imazu, Executive Vice President, Manufacturing and
Supply Chain Management; and
- Mitsuhiko Yamashita, Executive Vice President, Research and
Development and Total Customer Satisfaction.
Commenting on the countermeasures and executive changes, President and
CEO Ghosn said: "The additional actions we are announcing today will reinforce
our ability to manage through this global crisis, but they also position
Nissan for rapid, strong growth when conditions improve. An organization needs
to be flexible enough to meet the changing needs of the business, and I am
confident we have the talent, diversity and experience to lead Nissan
For further information:
For further information: Nissan Motor Co., Ltd., Communications CSR
Department, Global Communications CSR and IR Division, Tel:+81-(0)3-5565-2141,