Made in India, shipped to China, Thailand

“Trial production of parts has begun for the global platform cars scheduled to debut in China and Thailand next year. The tests have been very successful so far,” Mr Kiminobu Tokuyama, Managing Director and CEO, Nissan Motor India, told Business Line.

It is from the same platform that India will see the rollout of a hatchback, the revamped Micra whose production will be shifted from the UK, in mid-2010.

This will coincide with the launch of cars from the same platform in China and Thailand.

Global platform

The common global platform strategy is part of Nissan’s endeavour to produce a host of cars, be it hatchbacks or sedans, across five countries. Thus far, India, China and Thailand have been identified as key manufacturing locations. “We still have not taken a decision on the other two countries,” Mr Tokuyama said.

Experts, however, believe that there is a good chance of Russia and Brazil qualifying, keeping in line the positive outlook for BRIC (Brazil, Russia, India and China) economies in the coming years.

For instance, Toyota and Honda have, like Nissan, drawn similar big plans for a global platform in the BRIC nations with India tipped to be the launch pad when their cars debut in two to three years.

From Nissan’s point of view, India is a favoured destination for sourcing given the high quality of the vendor base coupled with an effective costing structure.

There are 94 suppliers associated with the Nissan project and more could join the list as the levels of localisation grow in the coming years.

The Japanese automaker has targeted production of one million cars across these five countries, though no specific timeframe has been finalised yet. “India is an important part of the overall strategy and this can be borne by the fact that it has seen the single largest investment from Nissan in 2009, of the overall $3.5 billion earmarked by the company globally,” Mr Tokuyama said.

“We are very proud of our manufacturing plant in Chennai and do believe that India has lots to offer in terms of its quality and efficient manpower. From Nissan’s perspective, it is a win-win business model,” he added.

Vehicle strategy

The vehicle strategy for the country will involve a mix of direct imports and locally produced cars. Following the launch of the new-look Micra in mid-2010, a sedan will follow a year later to be succeeded by “yet another model.”

Nissan has also planned a second car platform for India though work is largely at an exploratory stage right now. “We are carrying out preliminary market research and there is still some way to go. For the moment, we are completely focused on the Micra and building our market share,” Mr Tokuyama said.

While sourcing of parts will be a key part of its strategy, Nissan will also export fully built-up cars from India. These could well head out to Europe (where fuel-efficient cars are now sought after), West Asia and even South Africa which is gradually emerging a favourite for Indian automakers.

However, Mr Tokuyama declined to get into the specifics and confined himself to the fact that numbers would go up from 110,000 units to 180,000 units within two-three years of production ramping up in Chennai.

Nissan’s global ally, Renault had also planned a separate production line in the plant but froze investments following the global slowdown. The French automaker is now likely to use the Nissan platform and produce its own models though no decision has been taken on the matter.