Global Platform Strategy a Must for Nissan
16 June 1998
J.D. Power and Associates Reports: Global Platform Strategy a Must for Nissan
AGOURA HILLS, Calif., June 16 -- Analysis using J.D. Power
and Associates-LMC Forecasting Services new Global Product Advance system
shows that Nissan's late adoption of a global platform strategy will require
the manufacturer to leap significant hurdles in the North American market in
order to reduce its platforms by 2005.
"Nissan's global strategy is just getting under way," commented Lincoln
Merrihew, director of product tracking at J.D. Power and Associates.
"However, its need for such a strategy is among the most pressing among all
OEMs, given Nissan's most recent financial performance. Nissan needs to
capitalize on the potential cost savings and globally flexible production
capabilities a global platform may allow as part of its rebuilding," said
Merrihew.
Essentially, Nissan must be able to quickly implement a global platform
strategy in order to remain competitive. The key hurdles that Nissan will
need to address for 2005 include:
* Developing of an appropriate platform -- front or rear wheel drive --
for a Z-car replacement.
* Ensuring that the ride characteristics of the Pathfinder and QX4 remain
appropriate for the segment even if those vehicles switch to the body-on-frame
platform of the Frontier. (To reach 10 platforms, Nissan is likely to base
the Pathfinder, QX4, and Nissan Frontier of a single body-on-frame platform)
* Protecting and leveraging the brand equity of the Maxima even as Nissan
adds a four-cylinder version to replace the Altima.
* Preventing any sacrifices in the Maxima's platform design needed to
meet Altima replacement requirements from impeding the effective design of the
Infiniti I30, and the Quest minivan replacement
* Ensuring that Infiniti has sufficient product variety to combat Lexus
and Acura given the likelihood that Infiniti will have no unique platforms by
2005.
* Providing adequate funding for the global platform program to ensure
that it is fully implemented as quickly as possible.
The 14 models that Nissan currently sells in North America use 10
different platforms (counting the Mexican-market Tsuru and Tsubame as on one).
This nearly one-platform-per-vehicle approach illustrates that Nissan has
historically not been platform-oriented. The first global effort will be the
next Maxima, which will eventually be built at Nissan's U.S. plant in
Tennessee and will replace both today's Maxima and Altima (See tables -- table
1 shows an assessment of Nissan's likely global platforms and table 2 shows
the current models sold in North America and their basing through 2005).
Obviously, certain platforms will not be appropriate for all markets. In
particular, the Global Mini Car platform is too small for the U.S. and Canada,
though it might be appropriate for Mexico. Likewise, the Emerging Market Car
and Emerging Market Truck platforms will use older technology (to reduce
costs) and, therefore, will not find a home in the U.S. or Canada. Also, the
Global MPV platform will primarily be used for the larger vans sold in Japan,
but the minivan market in North America will have to be supplied by a vehicle
based on the Midsize/Large Car platform.
The effects of the platform consolidation will be different in North
America and Japan. In North America, the number of platforms will go from 10
to six by 2005. However, the reduction in platforms will not mean fewer
vehicle choices for consumers here because (1) Nissan has already cut the
number of vehicles it offers and (2) it will be able to create multiple
vehicles off of each of the global platforms. But, the platform reduction
will limit Nissan's ability to increase the number of vehicles it offers. It
also means that, in theory, any vehicles that are based on the Global Small
Car and Global Midsize/Large platforms could be produced in North America
because Nissan's North American factories already make vehicles that are
similar in size. This could mean additional exports from Smyrna, Tenn., and
Nissan's Mexican plants.
The majority of the impact of the platform consolidation will be felt in
Japan. Nissan-Japan currently has multiple vehicles based on a myriad of
different platforms. While this approach allows Nissan to saturate almost
every part of the market, this ability will be at risk with fewer platforms.
Also, because of consolidation, older, less flexible plants in Japan become at
risk, as the global strategy will allow Nissan to move production to the most
efficient plants.
J.D. Power and Associates is an international firm best known for its
marketing information services in key business sectors including market
research, forecasting and customer satisfaction. The firm's quality and
satisfaction measurements are based on actual customer responses from over one
million consumers annually. With its headquarters in Agoura Hills,
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and Connecticut. Its international locations include Japan, Korea, England,
Canada and Brazil.
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other promotional use can be made of the information in this release or J.D.
Power and Associates survey results without the express prior written consent
of J.D. Power and Associates.
Table #1
J.D. Power and Associates -- LMC Forecasting Services
1998 Global Product Advance Analysis
Estimates of Nissan's 10 Future Global Platforms
Nissan Global Platforms Drivetrain Est. Wheelbase Range
Global Mini Car FWD 90-94 inches
Global Small Car FWD 95-101 inches
Global Midsize/Large Car/
FWD Van FWD/AWD 102-110 inches
Global Sports Car RWD/AWD 96-102 inches
Global Large Car RWD 108+ inches
Global Light Truck Small RWD/AWD 96-103 inches
Global Light Truck Large RWD/AWD 104+ inches
Global MPV/Asian Van RWD 107-114 inches
Global Emerging Market Car
(Old Platform) FWD 95-103 inches
Global Emerging Market Truck
(Old Platform) RWD 97-104 inches
Source: J.D. Power and Associates 1998 Global Product Advance(SM) system
Charts and graphs extracted from this press release must be accompanied by
a statement identifying J.D. Power and Associates as the publisher, and the
J.D. Power and Associates 1998 Global Product Advance SM system as the source.
No advertising or other promotional use can be made of the information
in this release or J.D. Power and Associates survey results without the
express prior written consent of J.D. Power and Associates.
Table #2
J.D. Power and Associates -- LMC Forecasting Services
1998 Global Product Advance Analysis
Current Models Sold in North America and the Progression of Such Models
Through 2005 Including the Change in Platforms
Model Current Platform 2005 Platform Notes
Nissan Tsuru/
Tsubame Old B-Platform Global Small Car Could be
Emerging Car
Nissan Sentra/
200SX B Platform Global Small Car 200SX drops
in '98
Nissan Altima EQ Platform Dropped Replaced
Maxima IV
Nissan Maxima PQ Platform Global Midsize/
Large Car Maxima IV and
VI
Nissan 240SX S Platform Dropped Could be
reborn on
Global Sports
in platform
approved and
250Z not
approved
Nissan 250Z CR Platform Global Sports Car If platform
(possible 2000MY) (Skyline) approved
Nissan Frontier Frontier Global Light Truck Conned
Large North
American
production
feasible
Nissan CSV
2000MY Frontier Global Midsize/ Could be
Large Car Global LT
Small
Nissan PFN Platform Global Light Truck Would allow
Pathfinder Large North
American
production
(U.S.)
Nissan Quest VX Platform Global Midsize/ We expect a
(w/Ford) Large Car car-base
Infiniti G20 D-Platform Global Small Car Would allow
North
American
production
(Mexico)
Infiniti I30 PQ Platform Global Midsize Would allow
North American
production
(U.S.)
Infiniti Q45 Y-Platform Global Large Car RWD Only true
"large car"
from Nissan in
North America
Infiniti QX4 PFN Platform Global LT Large QX4 shares
with
Pathfinder
Source: J.D. Power and Associates 1998 Global Product Advance(SM) system
Charts and graphs extracted from this press release must be accompanied by
a statement identifying J.D. Power and Associates as the publisher, and the
J.D. Power and Associates 1998 Global Product Advance(SM) system as the
source. No advertising or other promotional use can be made of the
information in this release or J.D. Power and Associates survey results
without the express prior written consent of J.D. Power and Associates.