October Sales Fall on China, Europe

YOKOHAMA, Japan – Slower sales and increased competition in markets such as China, Russia and Europe put a strain on October results, says Nissan EVP of Global Sales Takao Katagiri. Highlights of the month, however, include the popularity of new models, an updated Nissan LEAF in Japan, and strong sales in Thailand.

Q1: Provide a brief overview of Nissan's global sales and market share for October.

Takao Katagiri EVP: October global sales decreased from the past year by 12.0%, or a deduction of 47,000 units from the same month last year. It's a little bit of a disappointing result, but the deduction is mainly driven by China. Out of 47,000 units reduction against last year, 44,000 units are in China – due to the effect of the [island dispute].

Also, to some extent in Europe, due to a reduction in total industry volume (TIV), we reduced volume by 6,400 units. But if we exclude those two big reduction factors, actually we are increasing global sales against the same month last year.

Q2: What about other markets where we have typically seen growth?

Katagiri EVP: In the United States, the newly launched Altima was very favorably accepted by the market. We increased Altima sales by 12.8% against the previous year. So, the Altima is contributing a lot to the overall U.S. sales of Nissan.

The downside is that in October, some volume negative effect was there due to the Hurricane Sandy. As for specific model lines, SUVs and trucks are seeing competition get harder and harder.

In Russia, historically, Nissan has been really strong. For the first time since May 2010, we reduced volume over the year before, mainly driven by harder and harder competition in the market. The situation is such that a lot of manufacturers are trying to compensate for the loss in western Europe in Russia. That is leading to harder competition, which we couldn't resist. But we have already put counteractions in place, so I hope that will recover in the month of November and onwards.

For Japan, both TIV and Nissan sales decreased against last year. But our reduction is better than the reduction of the market. That's why we increased market share in the month of October. If we divide the total market into two – mini-car and registered car – the mini-car market is not so affected by the overall reduction.

But in our case, many OEM business is supplied by Suzuki and Mitsubishi and that's why there are some limitations on supply. That's why we couldn't keep up with the total industry pace, leading to reduction of market share significantly.

There's a lot of good news in the registered car area. For example, the Nissan Note has been ranked #3 among all registered car rankings in October, as it was in September. Outselling Honda Fit, which is our benchmark, and the best selling compact car, except for the hybrid.

So, lots of good news. We hope that will be continued, especially as we got RJC Car of the Year. We're trying to utilize that good news to keep the current strong momentum of Note sales in Japan.

Q3: What are the highlights of October sales and market share?

Katagiri EVP: We launched minor changes to the LEAF in Japan in the latter half of November.

I hope the introduction of those minor changes will boost zero-emission sales in Japan. This minor change includes the introduction of anentry-grade or S-grade, and also some improvements to the powertrain.

Other good news is Thailand. TIV increased from the past year by 238%, mainly driven by government incentives for first-car buyers. Obviously last year, TIV was very small due to flooding. But in those circumstances, Nissan has exceeded the previous year by 288%, so over-proportionally to the total industry volume.

That good momentum of Nissan is mainly driven by the introduction of a series of new models, such as the March and Almera, has been very well accepted. At the same time, Sylphy launched in April 2012, which was also accepted very positively by the customers. So I hope we will be able to deliver as quickly as possible at the same time we will continue this good momentum in Thailand.

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