Nissan: Strategies to Build Global Presence
Deepika Jindal and Chandan Jee Institute of Management Technology, Ghaziabad
Nissan is one of the world¶s largest automobiles company. It has got manufacturing locations in 18 nations and services available in around 160 locations. Thus, it would be appropriate to call the company global to a large extent. In year 2007, Nissan¶s Executive Vice President, Tadao Takahashi mentioned its strategy of moving to transnational from multi-domestic. At present Nissan has increased its focus on emerging markets like India and Russia. In March 2010, Renault-Nissan Alliance inaugurated its first plant in Chennai, India. The plant will become operational in May and expected to launch car by mid this year only. This is not the first global move of Nissan. It has been making strategic alliance with number of other automobiles companies for example Renault, Volvo etc. as per its business strategy of direct technology transfer. This paper aims to study Nissan¶s ³Go-Global´ strategy. During the study, we will try to understand the various imperatives that company have to operate at multiple locations, how it chooses among various locations and how it goes about implementing the expansion plan. Studying Nissan¶s global strategy and focussing on its moves specifically in India and Russia, will help us enhance our understanding of Nissan¶s strategy. Also, it will not only provide us understanding of Nissan, but also help us to understand the concept and its practical usage in real time scenario in general.
Keywords: Nissan, global, India, Russia, strategy, alliance
With the increasing trend of globalization and heightened competition, most of the companies at some point of time think of expanding to new locations because of different imperatives ranging from efficiency, growth, competition, knowledge or mix of few. Each company decides its own parameters while making strategic choices of a market or a country. Every firm has a different strategy to make choices of the countries, understand their market potential, and make risk-return analysis of the country. The firm then determines the entry mode strategy after deciding a country and how and to what extent, they want to transplant their DNA to the new venture. The automobile industry is one such industry where one needs to be globally competitive to survive and as well as to keep growing. Many automobile companies have ventured into different countries for one or more imperatives mentioned
earlier. Nissan Motors is one of such companies which have made its presence felt in all the parts of the world. This paper is an effort to study the global strategies of Nissan focussing mainly on its new ventures in India and Russia. It studies the advantages and disadvantages of Nissan¶s strategy and recommends strategies to be followed in India.
Global automobile industry had a smooth ride and the industry rose in leaps and bounds till the recession hit the world. Automobile industry was highly impacted by the global financial downturn and the industry went into a crisis. The period from 2008-10 is considered to be period of automotive industry crisis. Most of the big guns in the industry lost huge deals of profits and sales declined. Many big players reached stage of bankruptcy like GM and Chrysler. The situation is getting better in 2010 with markets recovering and sales increasing slowly. In 2008, more than 70 million vehicles were produced but it was less than that of 2007 due to reduction in demand . The markets in North America and Japan have become stagnant but there has been rise in demand in developing nations mainly Brazil, Russia, India and China. China surpassed Japan to become the largest producer of vehicles. Toyota is the largest automobile company in the world followed by Volkswagen and GM. Automobile Industry in most parts of the world is highly competitive which has led companies...
References: 1. Mohamad R. Nayebpour, Akira Saito (), ³Toyota Vs Nissan: A contrast in Culture, Corporate Governance, Operational Strategy and Financial performance´ 2. Tadao Takahashi, Executive Vice President, Nissan Motors (2007), ³Nissan¶s Global Strategy´ 3. Automotive LOGISTICS (July/August 2005), ³Renault and Nissan - Alliance through logistics´, CarMaker, pp. (36-41) 4. Price Waterhouse Coopers Report, ( 20 January 2010), ³Prospects for the Russian automotive market´ 5. Andy Palmer, ³Follow the Light´ (January/february2009) www.automotivemanufacturingsolutions.com
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