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Nissan, Renault reveal how they'll reshape alliance to cut costs, regain profit

TOKYO — The auto alliance of Nissan and Renault said Wednesday it will be sharing more vehicle parts, technology and models to save costs as the industry struggles to survive the coronavirus pandemic. Alliance Operating Board Chairman Jean-Dominique Senard said the group, which also includes smaller Japanese automaker Mitsubishi, will have each company focusing on geographic regions. “There is no plan for a merger of our companies,” the chairman said. “Our model today is a very distinctive model ... we donÂ’t need a merger to be efficient.” He stressed the alliance needs to adjust to the “unprecedented economic crisis,” to pursue efficiency and competitiveness, not sheer sales volumes. “Now is the time to rebuild,” Senard said, making clear he believed the alliance remained strong. All automakers are suffering from the pandemic, and scaling back or suspending production, but Nissan was reeling before the crisis struck from a scandal involving its former chairman, Carlos Ghosn. Yokohama-based Nissan is due to report its annual results on Thursday and has forecast it will slip into its first yearly loss in 11 years. Under the latest so-called leader-follower initiative, Nissan will focus on China, North America and Japan; Renault on Europe, Russia and South America and North Africa, and Mitsubishi on Southeast Asia and Oceania, for the benefit of the entire alliance. Nissan Chief Executive Makoto Uchida said the alliance planned to pursue fiscal strength together. “The synergy is huge,” he said. The number of vehicles sharing the same platform will double by 2024, saving 2 billion euros ($2.2 billion), according to Senard. The shared technology will also include electric cars and autonomous driving, platforms and car bodies, the executives said. Nissan is a leader in electric cars with its Leaf, but such technology will be available to the other alliance members, they said. The companies gave few details of how the revamp would deliver in the short term, as the car industry grapples with the fallout from the coronavirus pandemic and pressure to develop less polluting vehicles. They said in a joint statement that they aimed to produce nearly half of their vehicles under the new leader-follower approach by 2025 and hoped to cut investment per model in the scheme by up to 40%. The range of vehicles they produce is expected to fall by 20% by 2025 though the firms did not say how many jobs would go as they shift production.

Nissan to make 85% of the vehicles it sells here in US

We could be in for a big push from Nissan in the manufacturing realm if Vice President of US Sales and Marketing Fred Diaz has anything to say about it. Speaking to the Automotive Press Association recently, Diaz (above) expressed a desire to build some 85 percent of the vehicles Nissan sells to Americans in the US, claiming it will happen "in the very near future." Nissan has already moved to increase exports of its US-built products, and in 2013, it built just over 76 percent of the models it sold in this market within our country's borders.
"Any issues of us taking advantage of the value of the yen, we want to dispel that," Diaz told reporters, pointing out the contentious issue of currency manipulation. There's also the obvious goal of positive PR - Americans like things made in America, and they like companies that invest in America. Diaz is quick to point out that Nissan had done just that: "While a lot of people retrenched [during the recession], instead we leaned into it and we continued investing and in fact made over $5 billion in investments, bringing a lot of production from Japan to the United States and to Mexico," Diaz said, pointing out that Nissan has helped create 8,000 jobs through its investments.
Nissan runs three factories in the US, two in Tennessee and one in Mississippi. Between the three, production is up 22 percent, while the overall exports from the facilities have increased by 100,000 units, Diaz told reporters.

Tesla about to sell 50,000th Model S

Nissan sold its 50,000th Leaf a total of two years and two months after introducing the EV to dealerships. Tesla isn't as established as Nissan, and its Model S - with its higher levels of luxury and performance - costs multiple times more than the Leaf. Consider the Tesla's starting price of $70,000-plus (and easily much more with a bigger battery and a few upgrades), and compare that to the Leaf's base MSRP of just a bit over $30,000 before its 2013 price cut. It would make sense, then, that it would take the Model S longer to hit 50,000 unit sales. But, no. The Model S could meet the 50,000 sales milestone before the end of October (in fact, it may already have done so). This is just two years and three months after it launched in late June 2012. The Model S could meet the 50,000 sales milestone before the end of October. Tesla hasn't released its sales report for the third quarter, but the Palo Alto-based automaker sold 39,128 units of the Model S through June. Previously, Tesla estimated it would have 7,800 third quarter sales (putting it at 46,928 through September), other independent estimates put Tesla at 50,000 sales in late October. The Model S may not have beat the Nissan Leaf to 50K, but it's not hard to see how this is a win for the California automaker. Arguably, this is a case where we all win. Anytime some buys an EV instead of a traditionally powered vehicle - regardless of marque - that's less energy consumed while driving, fewer emissions and an example set to others who have yet to make the switch. It's hard not to be impressed by Tesla's relative success. Furthermore, Tesla coming so close to Nissan in selling 50,000 EVs is, above all, a testament to the desirability of the Model S, despite the Leaf's clear advantage in terms of attainability.