NISSAN LIKELY TO AXE ITS DATSUN BRAND

NISSAN MAY DROP SOME UNPROFITABLE PRODUCTS AND CLOSE A NUMBER OF DATSUN ASSEMBLY LINES WORLDWIDE

YOKOHAMA,JAPAN: Nissan Motor Co. Ltd is likely to axe its Datsun brand, drop some unprofitable products and close a number of assembly lines worldwide as it seeks to boost profits by getting smaller, two people with direct knowledge of the matter said.

Known internally as the “performance recovery plan”, the proposed steps mark a sharp break with Nissan’s strategy under ousted leader Carlos Ghosn, who pursued ambitious vehicle sales targets in the US and other major markets.

The plan is the Yokohamabased automaker’s latest attempt to pull itself out of crisis after Ghosn was arrested for financial misconduct charges he denies. The scandal has further strained an already dysfunctional alliance with Renault SA and thrown Nissan into disarray as it finds itself on course to book its lowest operating profit in 11 years.

The people familiar with the matter said Nissan will likely kill loss-making variants for the Titan full-size pickup. Unprofitable variants include the single-cab and diesel versions. A planned shuttering of underutilised production lines will most probably hit plants in emerging markets building Datsun and other small cars hardest, they added.

“We need to chart a recovery but the rot goes deep,” one of the people said of the many problems facing Nissan.

The second person said all markets with factories except China were being looked at for possible reductions in production capacity. That person also said, however, that there were no plans to close an entire plant or withdraw completely from any country.

In the US, one of Nissan’s biggest markets, the plan calls for fresh efforts to weed out the practice of buying market share by selling vehicles to rental car and other fleet operators at heavy discounts - a practice which destroyed profitability and undermined Nissan’s brand image.

“We’re trying to clean up what had happened in the past,” one of the people said, adding that under Ghosn, Nissan sought to meet sales objectives at any cost, including “practically giving away cars” to fleet customers.