Oct 24, 2011

Nissan Green Program 2016 Announcement
Media Conference
October 24, 2011
Carlos Ghosn, President & CEO, Nissan Motor Co., Ltd.

In June, I announced Nissan Power 88, our mid-term business plan that set the roadmap for our company over the coming six years. Today, I am announcing our next mid-term environmental plan, designed to balance the business objectives of Nissan Power 88 with our responsibility to environmental sustainability.

This plan, called Nissan Green Program 2016, represents the pillar of sustainability within Blue Citizenship, which is Nissan's corporate social responsibility platform. Nissan Green Program 2016 is focused on three areas: reducing our carbon footprint, shifting to renewable energies, and increasing the diversity of our resources.

Under this plan, Nissan will annually invest 70% of its research and advanced engineering budget on environmental technologies. Nissan Green Program 2016 is the company's third environmental mid-term plan. Our track record demonstrates these plans are driven by clear and challenging operational objectives that we are able to consistently achieve.

The first plan - Nissan Green Program 2005 - launched in 2002 and focused on pollution control. The plan's success resulted in the certification of more than 80% of Nissan passenger cars as super-ultra-low-emission vehicles in Japan. And new designs adopted under that plan enable us to now recycle more than 95% of a vehicle's material weight.

The second plan - Nissan Green Program 2010 - was launched in 2006 with a focus on the management of CO2 emissions. Under NGP2010, Nissan introduced core green technologies, including idling stop and CVT, for application in a wide range of vehicles. Nissan also launched cars with low or zero CO2-emissions, such as clean diesels, our original-design HEV, and the Nissan LEAF electric vehicle. We achieved our objective to reduce corporate average CO2 emissions from Nissan products between 2000 and 2010 by 18%. And between 2005 and 2010, we over-reached our goal to reduce manufacturing-related CO2 emissions per vehicle by 7%, achieving a total reduction of 19%. As a result, Nissan kept its overall CO2 emissions flat, while increasing vehicle production over the plan period.

Corporations face many challenges on the path toward sustainability. According to the United Nations, the world's projected population in 2050 will be 9 billion, up from 7 billion today, and 70% of people will live in urban areas. Unsurprisingly, our future bears an increase of consumption of natural resources, industrial and agricultural production and energy use. For example, China and India will account for one-third of total world energy consumption in 2035*1. These challenges demand decisive action plans to be implemented today, plans that align and reframe business strategies and policies with a green economy. Nissan Green Program 2016 is our company's comprehensive response to these challenges.

*1 EIA, US Energy Outlook 2011

Nissan is one of the 50 largest companies globally by revenue. It is one of the top 100 brands globally. Our economic impact demands that we take on greater social responsibility. Nissan will increase the value it brings to society by continuing to offer safer, more efficient products, generate jobs and donate toward education, the environment, humanitarian, and other critical social needs.

In this environment of uncertainty, Nissan must manage its business in a way that balances economic productivity with social responsibility even further.

Blue Citizenship is the corporate social responsibility platform of Nissan. We have three areas of focus: sustainability...mobility...and community.

The first element is sustainability. Nissan is dedicated to sustainable business growth and to reducing our impact on the environment.

Second, Nissan is dedicated to providing desirable, safe, reliable and affordable mobility to consumers across the world. Nissan set the target to reduce by half the number of fatalities and serious injuries by 2015, compared to 1995. Having reached this target six years earlier in 2009, we have now challenged ourselves to a further reduction of 50% by 2020. Our ultimate goal is to reach a level of virtually zero fatalities and serious injuries.

By the end of 2011, we will complete the introduction of nine technologies that comprise our "All-around Safety Shield". These safety technologies, including a forward collision warning system and our industry-pioneering around view monitor, will not only further evolve but be selectively adapted and expanded to a wider range of models for the global market. One such technology is Nissan's rear camera multi-sensing system, which will debut in 2012.

The results of our investments into advanced safety technologies also extend into our growing range of zero-emission electric vehicles. The Nissan LEAF is the first all-electric vehicle to be awarded a five-star rating by the U.S. National Highway Transportation Safety Administration and a five-star rating from the European New Car Assessment Program, demonstrating that the LEAF is not only clean but safe.

Improving road safety goes beyond technology to direct, community involvement. This is why Nissan introduced the Safety Driving Forum in China as far back as 2005, and we will expand those driving programs to India, Brazil and other emerging countries.

Central to the third element of Blue Citizenship is community, and Nissan's dedication to giving back to society and supporting the communities where we do business.

Let me give you some specific examples.

The March earthquake and tsunami in Japan reinforced the interdependence of businesses and communities. As one of the many companies that rushed to the relief effort, Nissan focused its support around immediate direct financial support, employee gift-matching programs and mobility assistance. For example, we sent 50 Nissan Patrol four-wheel-drive vehicles to support relief activities through NGOs. We made 65 Nissan LEAF electric vehicles available for use in the stricken areas, helping relief efforts when gasoline was in short supply. And to date, Nissan employees have volunteered more than 1,200 man-days in order to help the rebuilding and relief efforts in the affected areas.

Our 6-year partnership with Habitat for Humanity International, which began in the U.S., has culminated in more than 56,000 hours of volunteer services. We are now expanding this partnership to emerging countries.

Let me now take you through the specifics of the Nissan Green Program 2016.

Initiative one: No. 1 in Zero-Emission Vehicles
Under NGP 2016, Nissan will be the clear leader in the production and sale of zero-emission electric vehicles. With the Nissan LEAF, the company has already established the highest sales volume of any single electric car in history with more than 15,000 sold to date. We will continue this leadership and expand our EV market penetration with at least three additional electric vehicles by 2016. This will push us toward our target - which we share with our Alliance partner Renault - of 1.5 million zero-emission vehicles sold globally by 2016.

In addition to our electric vehicle technology, we expect FCEV to contribute to advancing Nissan's leadership in zero emissions. For this reason, Nissan, within the Alliance, will jointly develop an all-new fuel cell electric vehicle with our strategic partner Daimler.

Nissan has a long history in the development of advanced fuel-cell technology, as demonstrated this month with the reveal of its latest compact fuel cell stack - the critical breakthrough technology for fuel cell electric vehicles - which is 50% smaller than the previous version.

Nissan's leadership role extends to the development of batteries, battery recycling, batteries for domestic and industrial energy storage and car-to-grid power management technologies. No other global auto group is as engaged in the advancement of sustainable mobility and the system to make it a reality as the Renault-Nissan Alliance. By 2015, the Alliance will lead the industry with a production capacity of 500,000 batteries.

Batteries are central to our strategy to reduce CO2 emissions and shift to renewable energies. This past July, 4R Energy Corporation - a joint-venture between Nissan and Sumitomo - announced a 100% zero-emission energy storage solution using solar panels that provide energy to chargers for driving Nissan LEAF vehicles. It's a clean, contained system.

Nissan is also collaborating with various partners to develop EV charge- and discharge-control technology that can be built into the infrastructure for future "smart-houses" and "smart communities".

Initiative two: Leading Fuel Efficiency
The second key initiative in NGP2016 is to attain leading fuel efficiency across the entire Nissan global fleet. Under the PURE DRIVE badge, Nissan is providing a variety of powertrain technologies designed to improve fuel efficiency, reduce emissions but still deliver the power and performance expected by our customers.

Nissan first introduced PURE DRIVE in 2009 on the Qashqai in Europe. Since then, we have sold 870,000 PURE DRIVE vehicles. And the technologies to support PURE DRIVE will continue to expand as we move toward 2016.

These include:

  • Extending our unique dual-clutch hybrid system including a new front-drive hybrid model, to be launched in 2013
  • An all-new plug-in hybrid model based on unique Nissan technology in 2015
  • The next generation X-Tronic CVT automatic transmission debuting next March. By fiscal 2016, we will have sold a cumulative 20 million CVT-equipped vehicles, since launch in 1992.

We are also focused on developing lighter materials and optimizing vehicle structures to increase fuel efficiency. For example, we are developing the world's first ultra high-tensile strength steel and will adopt it in vehicles from 2013. Planned for global deployment in models across the Nissan lineup, using this steel will reduce vehicle body weight by up to 15 kilograms.

Our PURE DRIVE technologies will be the main enabler in Nissan's ability to achieve a 35% improvement in Corporate Average Fuel Efficiency (CAFE) between 2005 - the base year of our previous Green Program - and 2016, for all Nissan vehicles sold in Japan, China, Europe and the United States.

Initiative three: Leading low corporate carbon footprint
Our third key initiative is to minimize Nissan's carbon footprint through continuous energy improvements across all areas of our business, and by increasing our use of renewable energy, including wind and solar. Nissan's long-term vision is to have the lowest carbon footprint of any major automobile manufacturer.

Nissan's future is zero-emissions, from plant to product. And under NGP2016, we will expand the use of renewables to our global sites beyond current projects, including solar power in Spain and wind power in the U.K.

Nissan is already expanding a compact painting process, as a global standard to all new plants worldwide in order to reduce CO2.

Nissan is committed to reducing CO2 emissions from corporate activities to average 20% per vehicle in 2016 over fiscal year 2005. This objective will affect logistics and activities at offices, dealerships and production sites.

Initiative four: Leading closed-loop recycling
The fourth key initiative in our Green Program focuses on reducing Nissan's use of new natural resources, and raising our use of recycled materials in new Nissan vehicles to 25% in 2016. Our long-term target is to minimize, as much as possible, our use of new natural resources. The key to achieving this objective is Nissan's unique approach to closed-loop recycling.

Through NGP2010, we have increased the recovery of materials in end-of-life-vehicles and achieved a rate of 95% in Japan. In closed-loop recycling, we extend the life of materials beyond use in just one vehicle to many vehicles. By reintroducing this recyclable material back into the value chain, we significantly reduce the entire carbon and environmental footprint of the vehicle - from start to finish - on a global scale. Nissan is the first in the automobile industry to set this recycling objective and to adopt a comprehensive closed-loop scheme, which includes the recycling of steel, aluminum and plastic.

For example, Nissan established a bumper-recycling program in April 2010 at our Oppama plant. Since that time, we have processed plastics from painted scrap bumpers collected from plants and dealers and that plastic has been made into130,000 bumpers now fitted to new vehicles, including Nissan LEAF.

This closed-loop scheme will promote the development of technologies that enable sorting and recycling and eventually help reduce Nissan's consumption of rare-earth elements, such as those used in our zero-emission vehicles.

In conclusion, Nissan moves towards fiscal 2016 on two, complementary tracks: our environmental and business midterm plans. Together, these action plans will ensure the company's balance of value creation and corporate social responsibility.
With NGP2016, Nissan's financial achievements are inseparable from our initiatives to reduce CO2 emissions, diversify our energy resources, promote sustainable mobility and give a return back to society.
I am confident that we will deliver the objectives of this plan, relying on the capable, hard-working and motivated men and women of Nissan global.

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