Nissan to Source More Parts, Vehicles Where It Sells

Nissan to Source More Parts, Vehicles Where It Sells

Localization is the answer to avoid currency fluctuations and to protect the supply of parts, an executive says.

TRAVERSE CITY, MI – Problems caused by a stronger yen and a super-strong earthquake/tsunami have added urgency to Nissan’s plan to localize production away from Japan and toward the regions where it sells its cars.

“We are clearly taking steps to make more vehicles in the U.S., like the Infiniti JX and the (Nissan) Leaf (electric vehicle coming to the Smyrna, TN, plant next year),” says Rebecca Vest, vice-president-purchasing with the Renault-Nissan Purchasing Organization for North America.

Today, Nissan makes in North America 69% of the vehicles it sells there. In 2015, that figure will rise to 89%, says Vest, and volume will climb from 1.4 million units now to 1.7 million.

Localization is the answer to avoid currency fluctuations and to protect the supply of parts, she says. The yen “is causing great angst every day” in Japan, “but it’s great news for you,” she tells the audience in a session at the Center for Automotive Research’s Management Briefing Seminars here.

She says the RNPO would “enhance the case (for supply contracts based in North America) with a reluctant product group (in Japan) to get your products validated.”

The RNPO is the common purchasing agency for Renault and Nissan, looking to take advantage of volume synergies between the two auto makers. Much sourcing for the new CMF1 platform for small cars that will be shared by Renault and Nissan is coming from North America, Vest says.

The strengthening yen is a problem for all Japanese auto makers, as was the tsunami.

Vest sent a North American purchasing team to Japan the day after the March 11 disaster to assess the problem and work on securing needed parts.

“People were climbing over boxes counting parts to make sure that we had enough for production,” she says. And purchasers from different regions worked together to direct available parts to where they were needed most.

Nissan will return to full operation in October, she says.

The auto maker wants its vehicles to offer innovation that “everyone can use,” Vest says. “All of us want your technology first. It’s up to the most appealing customer to get it first.”

Vest points to advantages suppliers will enjoy by offering their best new technology to Renault-Nissan, including the volume potential of the two auto makers and the large number of new-vehicle programs planned. Nissan is expected to release 51 models and 90 new technologies between now and 2016.

“The main goal of the RNPO is to deliver best quality with the greatest technology and maximize profit,” she says. “You have access to Renault and Nissan. Use our organization in the best way to take advantage of our system.”

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