Nissan could be announcing significant plans this month as it seeks ways to become profitable following troublesome times
Nissan will reportedly discontinue the Datsun brand due to unprofitability and shut down several production lines across the globe. It could be part of the “performance recovery plan” to increase profits and stands in contrast to the strategies planned by ex-head Carlos Ghosn who was arrested for financial delinquency and sent shockwaves to the automotive industry.
The Japanese automaker is in a profound urgency to make a comeback by posting profit numbers considering that the relationship with Renault is not too good as before. Nissan is said to axe the single-cab and diesel variants of the Titan full-sized pickup truck as well as the underused manufacturing lines especially in emerging markets producing Datsun vehicles and other small cars.
The production capacity of the factories in all markets but China are being considered to be cut down. Moreover, the plans to close a plant entirely or quitting a market cannot be ruled out of the equation reportedly. Nissan has formed a team led by Jun Seki, a senior VP and the soon-arriving vice CEO to chart a wide variety of plans that could be revealed this month and are currently in the final stage.
Back in July 2019, Nissan released a statement to reduce its workforce by 12,500 across the globe as early as 2023 alongside decreasing production capacity that would affect 14 facilities. This would lead to Nissan concentrating more on developed markets like the US and China. While the profit margins set by Carlos Ghosn were not achieved under the five-year plan, the upcoming strategy is certainly crucial for the brand’s future.
The low-cost budget brand of Nissan, Datsun, was revived after decades of absence to garner market share in the emerging markets like India, Indonesia and Russia. The main issue being reported is Datsun eating into the sales of Nissan models in these markets. In India, Datsun sells more cars than Nissan every month as the Go and Go+ alongside Redi Go are performing decently when compared to the parental company.
Datsun has also been hit by the sales crisis the Indian auto sector is facing through 2019. However, compared to Nissan, it is fairing quite well and has set up a decent brand image. With the global economy in complete disarray, manufacturers could take perturbing decisions and we will wait and see what the future holds for Datsun!