Nissan 2006 Annual Report Download - page 22

Nissan Annual Report 2005
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less globally, although needs vary from country
to country.
That’s why we developed our LCV Pro Shop
concept for Japan, to provide that superior service as
well as custom conversions. We opened two pro
shop hubs in fiscal 2005, in Kanagawa and Tokyo,
and recently another in Miyagi Prefecture. The hub
shops have basically all the services, and support
several satellite or spoke shops. We’ve done the
trials, checked the performance and the problems.
Now we’re ready to deploy the concept elsewhere in
Japan. Later we will export this concept to other
markets: Europe, for instance, will develop a similar
concept by adapting the Pro Shop model to specific
European customer needs. We see two slightly
different customer profiles in Europe, truck buyers
and van/pickup buyers. We’re working on adapting
the Pro Shop model appropriately.
LCV customers are big on conversions, rarely
wanting what comes out of the factory gate. They
want a box and shelving here, or a door there. We’re
having an organization in North America look at
extreme customer usage, such as ambulances and
SWAT team vehicles, to see how we can innovate
based on that—aspects like super-efficient storage,
and getting in and out of the vehicle quickly and
smoothly with lots of equipment.
Did we have this mentality two years ago?
No. We thought like a car company, and car
companies wait for customers to walk through the
door and sell them a product that is standard in
principle. The Pro Shops turn that around,
establishing an infrastructure that supplies exactly
the services the customer needs.
In an overall sense, we follow six strategies, all
linked to that 40 percent increase in volume and
doubling profit. First, renewing our portfolio. Second,
reducing cost and enhancing value for the customer.
Third, entering new territories. Fourth, enhancing the
value chain, because you need the marketing, after-
sales and conversion. Fifth, original equipment
manufacturing or OEM deals. And sixth, taking all the
lessons we’ve learned through this breakthrough and
passing that knowledge on to later generations of
LCV managers.
There are a couple of issues related to OEM
deals. In 2002, we found ourselves in a kind of limbo,
with a portfolio full of products produced by other
makers with our badge on them. Obviously we make
more profit from vehicles we sell, like AD Van and
Civilian, than on vehicles we buy.
Even our most aggressive rollout plans wouldn’t
supply enough volume to sustain the 8 percent
profitability that we want. So we looked for strategic
partners that would provide us additional volumes.
We’ve completed a deal with Renault Trucks in
Europe, cross-badging a new truck with them. They
enter a new segment; we enjoy the added volume.
We’ve signed a similar deal with Mazda for AD Van in
Japan and we are working on other deals.
Nissan has advantages in the LCV space. No
LCV competitor can play in every market in every
segment. And fleet managers, some of our key
customers, are taking a global perspective on
sourcing their vehicles. We don’t have global
coverage in every segment yet, but we’ve spent two
years on a plan that is getting us there.
We have an aggressive product-launching plan
for fiscal 2006 and 2007. Fiscal 2006 will benefit
from what we began two years ago as products
come out of the pipeline. We launch one all-new
product in Europe, the Cabstar, and three
significantly changed models. We will also launch
an all-new product in Japan. In fiscal 2007, the
network starts to hum, and we come in with new
products and start with a regional rollout. By fiscal
2007, we plan to cover almost 70 percent of the
world markets.
PERFORMANCE