Nissan right to focus on core strengths and cost control

Following today’s news that Nissan will close its Barcelona plant and plans to reduce its global production capacity and number of model offerings by 20% by 2023;

David Leggett, Automotive Analyst at GlobalData, a leading data and analytics company, offers his view:

“Loss-making Nissan had no real alternative but to cut costs wherever it could. The closure of the troubled Barcelona plant was widely expected, but the company is also taking serious action to reduce cost elsewhere including closing a plant in Indonesia.

“The new focus on core markets and products also makes sense, along with greater leveraging of the alliance with Renault in Europe – again, a move that should reduce costs.

“Concentrating on vehicle segments where Nissan is strong – especially electric vehicles, but also SUVs – was a no-brainer for a management team now embarking on a post-Carlos Ghosn strategic path.

“In the US, the approach will be to move away from reliance on fleet sales and aggressive volume targets to build a much more profitable business based on sustainable growth.

“A credible mid-term plan is a good start, even in these uncertain COVID-19 times. The key now will be execution on this plan in the context of a potentially volatile global business landscape.”

More Media