Region expected to deliver solid profit margins and contribute to Nissan’s midterm strategy of steady growth
Nissan Motor Co., Ltd. unveiled a major expansion strategy in the Africa, the Middle East and India region today as part of the company’s six-year midterm plan, Nissan M.O.V.E. to 2022.
Nissan aims to build on its strengths in markets including South Africa, India, the United Arab Emirates, Egypt and parts of sub-Saharan Africa. The company plans to maintain and build on solid profit margins in the region.
Nissan will further develop strong partnerships and use local talent to meet growing vehicle demand. Industrywide sales in the region are expected to rise by about 40% to more than 12 million vehicles a year by 2022.
Under the plan, Nissan aims to:
- Build on strong FY17 growth in the Gulf and South Africa;
- Increase market share in Turkey, Saudi Arabia and India;
- Expand industrial operations into new “frontier” markets, building on a solid presence in Pakistan and Nigeria, with more countries to follow;
- Extend Nissan Intelligent Mobility products and services in electrification, autonomous driving systems, and connectivity; and
- Accelerate the Datsun brand’s presence in new and existing markets.
“Under the Nissan M.O.V.E. to 2022 plan, the company is looking to capture the full potential of the Africa, Middle East, and India region,” said Peyman Kargar, chairman of Nissan in Africa, the Middle East and India. “Our ambitious plans reflect the exciting opportunities ahead. Nissan has already developed a strong presence within this fast-growing region, and we are well-positioned to maximize our growth and make an increasing and lasting contribution to Nissan’s overall performance.”
The regional expansion is the latest announcement of the global Nissan M.O.V.E. to 2022 plan. Launched in fiscal year 2017, the midterm plan calls for achieving sustainable growth while leading the automotive industry’s technology and business evolution. Globally, Nissan is targeting annual revenue of 16.5 trillion yen and an 8% core consolidated operating profit margin by the end of fiscal year 2022.
New market expansion
Nissan will expand into new frontier markets where few carmakers are present. This follows the March 2018 announcement that Nissan is entering Pakistan through a manufacturing and licensing agreement with its partner Ghandhara Nissan Ltd. The initiative to build Datsun models will create more than 1,800 jobs. Nissan will enter additional high-potential markets over the course of the plan.
In the Middle East, Nissan will add new models to its already strong presence in key segments, building on its fiscal year 2017 sales of 96,600 vehicles. The plan calls for boosting Nissan’s current market share of 16% in the Gulf states – where Nissan experienced its largest market share growth in fiscal year 2017 – to 20% by the end of fiscal year 2022. In Saudi Arabia, market share is expected to double from 7% in fiscal year 2017 to 14% by the end of the plan.
Other market initiatives will include growth in the fleet segment and improved dealership facilities. The company will also show Nissan Intelligent Mobility technologies at Expo 2020 Dubai as it prepares to offer electrified models in the region.
Nissan plans to increase its market share in South Africa, now at 10%, substantially over the course of the plan. The company’s sales in South Africa jumped by 26% to 53,400 vehicles in fiscal year 2017. The introduction of new models, including the new Nissan Micra, is expected to boost demand further.
Nissan is working to build on its strong market position in Egypt, where it’s the only manufacturer with its own plant, and on the company’s first-mover success in Nigeria, where Nissan vehicles are assembled with a partner. Nissan is studying further manufacturing opportunities in sub-Saharan Africa.
In India, the company will strengthen its dealership network and develop the power of the Datsun and Nissan brands through initiatives including sponsorship of the International Cricket Council. Nissan has built a strong foundation for growth in India with a 480,000-vehicle capacity plant, as well as a large research and development center – both in Chennai and established with its Alliance partner, Renault.