Nissan Looks to Increase Japan Manufacturing and Sales

Nissan Motor Company said today that it will focus on increasing sales in its home market and reduce exports to offset the impact of the strengthening Yen.

The fall of the U.S. dollar to near record lows has taken a bite out of Japanese automaker’s profits. Nissan, for example, exported about 57 percent of its domestically produced vehicles in 2010.

Despite high exchange rates, increasing labor costs and the ever-present threat of earthquakes, Nissan says it wants to keep the majority of its production in Japan. In order to do this, the automaker also plans to build more vehicles for other brands with which it has original equipment manufacturing arrangements.

The automaker has set a domestic production target of at least 1 million vehicles in order to improve its manufacturing processes and protect Japanese workers. According to the company’s Executive Vice President, Hiroto Saikawa, Nissan also hopes to increase the number of vehicles it sells in Japan to 600,000 annually, up from just 460,000 units sold in 2010.  At that level, the percentage of vehicles exported could fall to as low as 40 percent of total domestic production.  He did not specify a timeframe for achieving the sales goal.

Nissan is the No. 2 auto maker in Japan behind Toyota Motor Corporation, with a 13 percent market share.

For its fiscal year which ended last March, Nissan sold 600,202 vehicles in Japan.  However, the Nissan-badged 660 cc minivehicle, which is manufactured by Mitsubishi Motors Corporation and Suzuki Motor Corporation accounted for 24 percent of the sales.

Nissan also trails Toyota and Honda Motor Company in terms of best-selling vehicles in Japan. In 2010, only two Nissan models were included in the list of best-selling vehicles. Toyota accounted for five of the ten best-selling models. The remaining three models were Hondas.

Saikawa said he hopes a new compact model, being developed now, will make it into the top-10 list. He is also hopeful that the Leaf all-electric model will eventually rank in the 20 best-selling models in Japan.

Today’s announcement appears to be in stark contrast to plans to begin manufacturing the Infiniti JX SUV in the U.S. in 2012.  The company has also indicated that it would shift production of its Rogue SUV to the U.S. at some point.

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