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When the CEO of the Japanese Nissan automaker, Makoto Uchida, rose to the level in May to report the figures for the year ending in March 2020, the figures seemed bleak.
Nissan reported a net loss of JPY 671 billion ($6.2 billion), which is not only its first loss in a decade, but is also painfully the largest in 20 years.
The dramatic escape of former high-level president Carlos Ghosn of Japan in December, reports of cracks in the Renault-Nissan-Mitsubishi alliance and the latest crippling effect of the global pandemic have helped its cause.
By the time Uchida reported the figures, Nissan’s inventory had already lost almost 30% of its price since the beginning of the year, however, we decided to rotate the corporate one. He announced a four-year recovery plan that included a 20% relief in production to approximately 5.4 million games in line with the year, and under pressure the desire to reduce annual constant prices across about three hundred billion yen ($2.7 billion) in constant annual prices through measures adding up to the closure of its plants in Barcelona and Indonesia. To lead its activities in the Middle East, the company has appointed Guillaume Cartier as senior vice president and president of the Africa, Middle East and India (AMI) region.
Cartier recently held a press convention to discuss the new direction of the market he now oversees.
“This is volume at all costs,” Says Cartier, contrary to the company’s previous policy of focusing on volume expansion. “This is a successful expansion and a monetary field because we want to repair a larger LNP than we do today.”
Nissan Middle East FZE (NMEF) reported that domestic sales for FY 2019 increased by 0.5% year-on-year.
“We perform very well locally for Nissan Middle East, which includes the Levant markets in Jordan, Lebanon and Iraq. And we control to increase our percentage to 0.5% until fiscal year 2018. The same is particularly true for Gulf markets,” he added. said Thierry Sabbagh, managing director of Nissan Middle East.
The Gulf markets for Nissan’s Middle East department are the United Arab Emirates, Bahrain, Kuwait, Oman and Qatar.
Nissan brought its new Sunny to the United Arab Emirates in May, and more importantly, announced the new Nissan Patrol in September last year as a worldwide revelation in Abu Dhabi.
In the Middle East, the Nissan Sunny sold 27,800 games, recording an expansion of 20 years on year, and representing 37 of the total sales volume.
But for Nissan Middle East, a key indicator of its fitness in the region, the functionality of its SUV Patrol, a car that has been a constant good fortune for the logo in the region since its arrival here in 1951 and has even been dubbed the “king of the desert”.
“Driven by the launch of the 2020 Nissan Patrol, our total Patrol sales grew by 65% annually. With a total of 13,700 games sold, this iconic SUV contributed 18 of our total sales volume,” Sabbagh says.
The pandemic has been key to almost every car manufacturer. Sabbagh said the TIV dropped more than 80% at the start of the close.
“Once the restrictions were eased, we saw an attractive dynamic in the retail sector. The length of the company’s fleet remains a little more complicated as corporations try to perceive the effect of the crisis on their own businesses before making decisions.” says Sabbagh, who adds that sales for Nissan Middle East’s fleet increased by 3% during the year. 19 compared to last year.
Cartier, for his part, remains wary of his clients for an immediate recovery in the region. “Right now, I don’t run [the business] annually, but much more weekly,” he says, adding that the company is now acting to “prioritize and optimize.”
“Rationalizing means resizing production capacity. It used to be said that we could produce only 8 million and seven million [units]. We had a production capacity that had been built for that number. But lately we are five million – the resizing of our production. If we don’t, our prices will be overlooked because we can’t absorb constant prices,” Cartier says.
When asked if some of the relief in constant prices would mean relief in its workforce in the region, Cartier instead chose to specify the scope of Covid-19’s effect on companies in the region.
“For the past 3 months, in the region where I am in charge, the market place is 70% lower than last year. We don’t know, for example, how big the market place will be in Arabia. Initially, we plan a business to plan a TIV that would be 600,000. Today, with Covid-19, oil costs and higher taxes, the TIV will potentially be 350,000. As a result, their source of income has fallen by 45%. No industry can withstand such a decline. »
Within the Ami region controlled through Cartier, Nissan recently has production plants in South Africa, Egypt and India, the latter supplying the Middle East market with the Micra, as well as sunny’s past generation. As for prioritization, Cartier says it is essential for the logo in fundamental products and technology.
“We need to capitalize on SUVs: Patrol, X-Trail, Qashqai, Navara. In terms of markets, it is transparent that the center is the Gulf market, which is essential in terms of benefits and volume engine,” explains Cartier. .
But it insists that volume accumulation is secondary, while getting a higher market percentage is a more immediate concern.
“The way I measure functionality is now based much more on the percentage of place market in the market [that we have]. Today, we constitute 6% of the market place at the destination in the Gulf and point to a percentage of place in the Gulf market above the global average,” Cartier adds.
Sabbagh reiterates the strategy in position for the Middle East. “We expect to have a market position percentage of more than 12% in all the market positions we hold; in some market positions we are close to 20% and in some market positions we are just above 11.”
As a component of the reduced production plans, Nissan will launch 12 models internationally over the next 18 months. The AMI department will present 8 new models over the next two years. One global strategy that is sure to have a ripping effect on the car manufacturer’s mid-East operations is the more than two-decade Renault-Nissan-Mitsubishi alliance, which, although cracks have appeared in recent years, has now merged by sharing the burden of the Covid-19 Destructive Pandemic and has an effect on its individual businesses.
“Each logo has its own independence in terms of company control and the LNP. When you upload all 3 logos, you have about 10 million sales,” says Cartier. “With the concept of ‘leader-follower’, this means that in some regions, platforms and technologies, one company will be the leader and the other two will be the followers. In China, for example, the leader will obviously be Nissan because from their presence If Renault or Mitsubishi need to take advantage of our commercial capacity or our government appointments, that’s where they can paint with Nissan.
“Reciprocity can be applied in Europe, where Renault will be the leader. This means that if the other two brands need to register and benefit, they can do so. The same goes for South Asia in Thailand and the Philippines, where Mitsubishi is strong and Mitsubishi will be the leader.
“As far as generation is concerned, of all who do everything, you will specialize. Therefore, for e-power and hybrid generation, the leader is Nissan. If the follower needs to use it, they have access to it. same reciprocity on some platforms. Nissan will lead the C and D platforms, the largest platforms, and Renault [will take the lead] more on small platforms A and B. Not everyone does the same thing, but everyone does what the other can get advantages. “
In the United Arab Emirates, Nissan has been a major player in the automotive scene, even after being named the official automotive spouse of Expo 2020 Dubai, which was now postponed due to the Covid-19 pandemic and will begin on October 1, 2021. . Training
“Nissan will provide long-term mobility at Dubai’s Expo 2020 with next-generation cars and complex on-site technologies, all powered by Nissan Intelligent Mobility,” Sabbagh says of Nissan’s plans for the event.
“Nissan will also include a fleet of cars, adding electric cars (EVs) to Dubai’s Expo 2020.”
As for those electric vehicles, expect to see a production variant of the newer Nissan Ariya, the electric crossover that the automaker unveiled last month at its new Nissan pavilion in Yokohama, which is its all-electric vehicle after the Leaf. The Ariya is expected to go on sale in Japan in mid-2021 and will be priced at around JPY five million (Dhs 173,000).
Nissan is expected to launch more than 8 electric models through 2023, and Sabbagh described the situations in which those electric cars will be deployed in the Middle East.
“It depends on one market to another, and even on subsidies presented through governments. For example, in Jordan, commercially, it makes sense to introduce an electric vehicle due to the tax exemption from electric cars; recently introduced the Leaf in Jordan. Our partners at the right time, how we should present it and whether it makes commercial sense. For markets like the UAE, we’re looking for that and we’ll make a decision.
At the 2019 Dubai International Auto Show every two years, Nissan is among the few car manufacturers to pass at full speed with an extensive presence.
“Nissan is one of the few major brands to participate in the Dubai International Auto Show last year and this demonstrates our commitment to the region. If the UAE government makes the decision to hold a car show over the next two years, our commitment is certainly to inspire what the government is implementing,” Sabbagh says.
In the future, car screens are likely to go from special occasions to virtual occasions, where products are virtually presented. The crashes in the United Arab Emirates have led Nissan to advance a virtual transformation strategy that adds online car control, chatbot and a virtual education academy.
But the virtual impulse, Sabbagh says, will come at the expense of the showrooms.
“Some partners enjoy a complete online experience and you can buy the car completely online. But, again, it’s appealing to see that as much as other people connected, and in fact there’s no way to go back to introduce more innovation on virtual platforms. they also began to return to the showrooms [once the lock restrictions were relaxed].
Although symbolic, Nissan also unveiled a new logo last month. This will not advance its recovery strategy, but it will also not do much damage by serving as a totem for this 87-year-old company, which in many ways is in a decisive struggle to rank among the world’s leading automakers. Training
“We’ve been through a series of crises over the last 10 years, but we’ve noticed that the industry has recovered and that’s what we expect,” Sabbagh says.
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