Of Japan’s three largest manufacturers, Nissan was arguably the hardest hit in terms of destruction at its facilities
In the aftermath of the 2011 disaster, Nissan’s COO Toshiyuki Shiga launched an Earthquake Crisis Committee at company headquarters in Yokohama. The Iwaki Plant was closest to the quake’s epicentre and experienced the most serious damage. The shaking lasted three minutes, the plant manager later reported, though miraculously all 304 employees were unscathed despite falling ceiling pipes and metal ducts, shattered windows and what was later learned to have been a magnitude six shock nearby.
Just seven weeks later, on May 17, Iwaki was back online building V6 petrol engines for the Fuga sedan and its twin, the Infiniti M. Company president Carlos Ghosn visited the rebuilt factory, telling the media that while the site had been made safe, some ¥3bn ($32m) would be invested in reinforced foundations to make the floor better able to withstand any future quakes.
Like its rivals, Nissan’s domestic production in the months after the earthquake was slowed to a great extent by the travails of its suppliers, whose damaged facilities or lack of access to uninterrupted electricity took several quarters to return to normal strength. Getting hold of the parts needed for domestic production was a major issue but components for overseas assembly plants also needed to be shipped. One of the nerve centres identified by Nissan’s Earthquake Crisis Committee was Honmoku Wharf, a major partssupply base for overseas markets, along with three others in Kyushu, Aichi and Fuji. Normally, 400 containers are shipped abroad daily from the four bases, with over 1,000 truck movements on site, but all were halted because of the March 11 quake.
The determination to keep Honmoku Wharf moving called for a new way of thinking. People from overseas plants in 10 countries came to help. In some cases, they adjusted production by stopping working overtime or Saturdays, which made it easier to resume shipments without confusion. Slowly, steadily, the pace of shipments began to pick up speed and by May, operations had returned to normal – an impressive performance.
Despite Nissan losing so much production in March, April and into May of 2011, by the following month, it decided the time was right to go public with a new medium-term management plan. The company’s new post-earthquake business strategy was in stark contrast to that of Toyota’s.
While Japan’s largest automaker, still enmeshed in what must have seemed like a never-ending series of image-destroying vehicle recalls, fixed on the idea of pursuing customer satisfaction above all else, Nissan decided it was time to aggressively target emerging markets.
Its plan, revealed in June 2011, set a new goal of lifting global market share to 8% by March 2017. That translated into worldwide annual sales of over seven million vehicles. To get there, Nissan set itself the task of adding 500,000 units of production for five consecutive years.
In February 2013, the Renault-Nissan Alliance reported a record 8,101,310 vehicles had been sold in 2012, equating to one in every 10 new cars sold worldwide. While the achievement represented a fourth straight annual gain, Renault’s troubles at home and the depressed European market in general meant that globally, the overall gain for the Alliance was just 1% year on year.
Nissan fared far better than its partner, and even though it didn’t quite hit the five million mark, it went close, selling 4,940,133 units. That represented a year-on-year rise of 5.8% and a new calendar year record. The company had two markets each exceeding one million units in 2012: China and the United States.
In Japan, Nissan’s sales rose 11.6% to 659,756 units. The new Note hatchback, NV350 Caravan and Serena minivan contributed to the sales increase. Mini-vehicles grew 5.4% to 153,335 units – a new calendar year record. It was also a good year for domestic market manufacturing. Production in Japan was up 3.2% year on year to 1,148,265 units, while global production rose 5.5% year on year to 4,889,379 units, achieving an all-time calendar year record.
Since returning its Japanese plants to full production, Nissan has actively pursued its rigorous growth target in all regions. The results, as noted above, have been extremely positive in all major regions, with even its Europe division doing relatively well thanks to the brand’s strong presence in the UK and Russia. Next year, the Datsun nameplate will return, with Indonesia, Russia and India the first three markets for what will be a low-cost brand.
With so much growth the goal from lower income markets, Nissan cannot afford to allow its manufacturing costs to rise. With that in mind, more parts will be shared, not only between the Alliance brands of Nissan, Infiniti, Renault and Dacia, but also with Datsun and, in Russia, with Lada.
A major new piece of the global manufacturing jigsaw will fall into places later in 2103 when the first Nissan vehicles developed under a new Common Module Family (CMF) strategy appear. Prior to the shift in engineering philosophy towards the CMF system, Nissan had placed an emphasis on building several vehicle variations derived from a single platform. The result was multiple platforms, though most were shared with Renault as a way of amortising costs.
The basis of CMF is the creation of four modules – engine compartment, cockpit, front underbody and rear underbody – plus the architecture for electronic components, while each module may have variations to suit different vehicle applications. New vehicles must now be developed with combinations of modules, which can range from compact cars, mid-sized sedan, or large vehicles, plus tall SUVs and crossovers.
Nissan has committed itself to bringing 90 new technologies to market by 2016, each of which must be integrated within CMF. The launch of the new platform strategy will, the company believes, enable commonality that extends across vehicle segments, lowering costs and bringing advanced technology down from higher-end models.