No Japanese in a Nissan Factory
China is the largest market for new cars, and motor corporations over the world have competed for this market fiercely. In order to make a rapid expansion of their market they start to increase their production in China.
It is reported that Nissan decided to build a "no Japanese factory", a new factory in Dalian constructed by Dongfeng Nissan. The contraction will be started in October and now it is in preparation. The new factory will cover an area of 1.27 million square meters facing the Port of Dalian. The factory is carefully checking the quality of all the construction processes including welding, coating, installing etc. in order to establish the production system that they could produce 150 thousand cars per year.
After the test run the factory will be operated by 2000 Chinese workers and the Japanese employees will come to the Dalian factory on a business trip from Japan and Huadu.
In correspondence to the moving in of Nissan, about ten Japanese and thirty Chinese suppliers have moved in Dalian, and they are all making pressing preparation so as to start the operation by the end of the year.
Song Shunbo, the vice director of administration committee of automobiles in Dalian, said that the moving in of Nissan was expected to create about 15 thousand jobs, which would be the contribution of Nissan to Dalian.
Nissan takes the factory in Dalian as the manufacturing base of SUV which is popular in the Chinese market. And it will produce X-Trail and qashqai in this factory which are to be sold in China.
At present Nissan expects to produce 150 thousand cars, and depending on the sales status it will expand the factory with a goal of increasing the annual output to 300 thousand.
The sales of Nissan in China in December 2013, compared to that in the same time of the preceding year, had increased by 70% and reached 134.2 thousand, which recovered to the level before the anti-Japanese protests. The competition in the Chinese market is fierce, and the market would probably be grabbed by others if it fails to boost the yield of popular cars.
In the macro environment of Chinese market, Nissan's strategy is to reduce the cost by entire localization and to sell all the products with China. This could be the mode that helps Japanese companies survive in China when the situation is bad for them.
The general manager of Dongfeng Nissan Susumu Uchikoshi said,"In order to survive in China, we need to make not only prompt judgment but also tight communication with managers and workers." So the company made the decision of "no Japanese". Besides, Nissan believed that if the factory was operated by Chinese the work efficiency would be improved and they could grasp every opportunity. Chinese managers could make a decision within one day, but if the managers are Japanese, they would have to report to the parent company first and the decision would not be made until all the departments make careful research and study. It could take a few weeks or even months.
Many transnational enterprises gradually realize that only when the core business is handled by Chinese employees can they expand the business. In order to expand the China, the huge market with 1.3 billion consumers, Japanese companies still have to endeavor.