President and Chief Executive Officer
The past fiscal year was one of progress, defined by solid financial results and the achievement of important operational goals in several parts of our business.
The latest 12-month period, covered in this Annual Report, saw Nissan deliver a 20% increase in net sales to 10.48 trillion yen and a 14% increase in net income to 389 billion yen*.
This is a creditable result at the mid-point of Power 88, our six-year strategic plan. As part of that plan, Nissan remains committed to achieving an operating profit margin of 8% in 2016. We are making encouraging progress towards that goal, particularly against a backdrop of intense global competition, sluggish conditions in Europe and volatile demand in emerging markets. During the past year, we also strengthened our management structure; set new convergence targets for the Renault-Nissan Alliance; brought new manufacturing capacity onstream; unveiled breakthrough products; and continued to pioneer new technologies.
But we have more to do. Nissan is not yet operating to its full potential. So we are accelerating efforts to build competitiveness, contain costs and improve our brand power.
Those efforts will reinforce our delivery of the Power 88 plan.
As part of that plan, we last year enhanced our brand presence in every segment from premium Infiniti to entry-level Datsun – where new models including Q50 and GO were launched. The Nissan brand saw the all-new Qashqai and X-Trail introduced to widespread acclaim. In total, Nissan brought 10 new vehicles and 22 new technologies to market in the past year, and will continue its product offensive in the current fiscal period.
In another pillar of Power 88, Nissan continued to champion zeroemissions with the all-electric LEAF car and introduction of the e-NV200 van and wagon. The LEAF now commands almost 50% share of the global market for EVs, with aggregate sales surpassing 110,000 units. Nissan is contributing to wider EV adoption by supporting a wider recharging infrastructure and EV fleet-penetration – not just in developed countries such as Japan but in growth markets including Bhutan.
Our brand-power and zero-emissions strategies are aligned with the Power 88 goal of increased sales power. Nissan bolstered its sales presence by implementing a new six-region sales organization during the year. We expect this new structure to accelerate the growth achieved in fiscal 2013, when unit sales rose by 5.6% to 5.19 million, equivalent to global market share of 6.2%.
A strengthened senior management team also began work to implement efforts to improve competitiveness, productivity and sales. This team is focused on turning the Power 88 goals into reality.
Our growth potential also reflects benefits from the Renault-Nissan Alliance, which achieved combined sales of 8.3 million units last year. We are committed to extracting further benefits from the Alliance. We marked the 15th anniversary of the Alliance by accelerating convergence in four key functions Engineering, Manufacturing & Supply Chain Management, Purchasing, and Human Resources. Convergence in these four key business functions will result in an immediate increase in efficiency and leverage our size to achieve competitive economies of scale. The synergies will then enable us to deliver higher-value vehicles to customers and stay at the leading edge of innovation. Together, these projects aim to deliver annualized synergies of at least €4.3 billion by 2016. In parallel, we are continuing to develop Alliance partnerships such as joint-engine development with Daimler, mini cars with Mitsubishi, with Ashok Leyland in commercial vehicles and, importantly, with AvtoVAZ in the promising Russian market.
Our Alliance ambitions coincide with a deep commitment to technological innovation. Nissan remains at the forefront of autonomous driving, which has the potential to revolutionize our industry. Nissan has pledged to bring commercially viable autonomous drive vehicles by 2020. This initiative forms part of Nissan’s commitment to zero fatalities, and we have become the first Japanese automaker to road-test autonomous-drive vehicles.
Looking forward, we anticipate continued sales growth in the current fiscal year, benefiting from further product launches and the impact of new capacity coming on-stream in markets including Mexico and Brazil. Nissan is launching
10 new vehicles this year, including the new Murano, the new Pulsar C-segment hatchback in Europe, the new zero-emissions e-NV200 in Japan and Europe, a number of Datsuns, a new one-ton pick-up truck and longwheel-base Infiniti models in China. Nissan will also continue to innovate and expand in key areas such as light commercial vehicles, zero emissions and aftersales.
This innovation-focus and product-launch schedule will enable Nissan to capitalize on market conditions as they improve around the world. We continue to see improvements in our US performance. Europe is showing signs of recovery. We remain positive about the Russian market. Sales are also forecast to grow healthily this year in China, where we will begin production of a Venucia-branded electric car, as well as two Infiniti models, whilst also opening our fourth plant in Dalian. Together, such trends should help offset any impact from the sales tax increase in Japan, which could dampen consumer demand.
As detailed in this report, Nissan is making satisfactory progress. We are moving in the right direction, reflected by our financial results and sales
figures. In a further sign of confidence, we have increased the dividend payout ratio from a minimum target of 25% to 30% for the remainder of the plan.
Nissan is a company committed to exceeding expectations: for customers, for suppliers, for employees and for shareholders alike. We will relentlessly pursue growth opportunities and continue to focus on quality and cost competitiveness, sales power, sustainability and innovation. Nissan is on the move. Please join us for the journey.
President and Chief Executive Officer
Nissan Motor Co., Ltd.
NISSAN: Enriching people's lives
Nissan provides unique and innovative automotive products and services that deliver superior measurable values to all stakeholders in alliance with Renault.