Nissan Company


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Nissan Company

  1. 1. CASE STUDY Nissan’s Turnaround Story Submitted By: Mudit Agrawal 8nbng196
  2. 2. I NTRODUCTION A BOUT N ISSAN M OTORS L TD. <ul><li>In 1970s and early 80s Nissan and Toyota entered into the US market. </li></ul><ul><li>By 1985 Nissan became the second largest exporter of automobile after Toyota . </li></ul><ul><li>Nissan Strength was Technological competence. </li></ul>
  3. 3. P ROBLEMS F OR N ISSAN M OTORS L TD. <ul><li>In late 1980s Nissan started facing severe competition from Toyota and Honda. </li></ul><ul><li>Appreciation of YEN against US $. </li></ul><ul><li>In 1987 Japanese economy was in boom ,so Nissan started borrowing and raise their production . </li></ul><ul><li>Debt for Nissan in 1999 was US$ 22 billion. </li></ul><ul><li>Domestic market share had fallen from 17.4% to 13% at the end of first half of 1999. </li></ul>
  4. 4. P ROBLEMS F OR N ISSAN M OTORS L TD. <ul><li>Global market share which was 5.8% in 1988 drop down to 4.9% in 1999. </li></ul><ul><li>Debt was more than Yen 2.1 billion </li></ul><ul><li>Started thinking of Joint venture … </li></ul>
  5. 5. I NTRODUCTION O F R ENAULT. <ul><li>Strength of Renault is R&D and Design . </li></ul><ul><li>In 1980s Renault was also facing problems. </li></ul><ul><li>No global presence and low productivity . </li></ul><ul><li>Company reconstructed in 1990 and privatized in 1996. </li></ul><ul><li>In 1998 Renault had around 7.9 billion pounds as equity and 1.9 billion pound as cash and was debt free company . </li></ul>
  6. 6. A LLIANCE B ETWEEN N ISSAN A ND R ENAULT . <ul><li>Expectations regarding Alliance. </li></ul><ul><li>Global market and Production line . </li></ul><ul><li>Economic value of Alliance. </li></ul><ul><li>Agreement was signed between Renault and Nissan . </li></ul><ul><li>GAC was formed . </li></ul><ul><li>CEO Carlos Ghosn visited Nissan . </li></ul>
  7. 7. M EMORABLE P ICTURE Yoshikazu Hanawa and Louis Schweitzer 27 th March 1999
  8. 8. A CCORDING T O C EO C ARLOS G HOSN . <ul><li>Lack of clear Profit-Orientation. </li></ul><ul><li>Insufficient focus on customers. </li></ul><ul><li>Too much focus on chasing Competitors. </li></ul><ul><li>No co-ordination of working. </li></ul><ul><li>Language problem. </li></ul><ul><li>Decision making process. </li></ul><ul><li>Labour Management. </li></ul>
  9. 9. N ISSAN R EVIVAL P LAN . <ul><li>Common Language – English. </li></ul><ul><li>Nine Cross-functional teams. </li></ul><ul><li>Changed Reward System. </li></ul><ul><li>Career Progression System. </li></ul>
  10. 10. I MPLEMENTATION O F N ISSAN R EVIVAL P LAN . <ul><li>Cut down in Purchasing Cost . </li></ul><ul><li>Suppliers were reduced. </li></ul><ul><li>Overlapping outlets were closed. </li></ul><ul><li>Plants were closed. </li></ul><ul><li>Work force were reduced. </li></ul>
  11. 12. THANK YOU
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