ifa>c Tour Nissan s Global Strategy March 1 st, 2007 Tadao Takahashi Executive Vice President Nissan Motor Co., Ltd. ifa>c Tour Marc h 1, 2007 1 Nissan s Global Strategy Oppama Challenge Global Deployment 2
Nissan s Global Strategy From revival to growth and further development Nissan Revival Plan Revive our company Profitability in FY00 Operating profit margin> 4.5% in FY02 50% debt reduction by FY02 NISSAN 180 Complete revival on track for profitable growth Commitments +1M units by Sep. 2005 8% operating profit margin 0 automotive debt Nissan Value-Up 2000-2001 2002~2004 2005~2007 Value up with sustained performance 4.2M units in FY08 Top level operating profit margin 20% average ROIC 3 Nissan s Global Strategy 70 New Model Launches FY05 FY06 FY07 Japan NAFTA Europe GOM Note) Just image not reflect actual figures Number of start of production 1H 6 2H 5 1H 14 2H 15 1H 19 2H 11 4
Nissan s Global Strategy Geographic Expansion (Brazil, Russia, India, China, etc.) Vehicle plant KD: Knockdown plant Vehicle plant (Incl. (Incl. KD) KD) :: 27 27 Powertrain plant :: 25 25 5 Nissan s Global Strategy Oppama Challenge Global Deployment 6
What is the Oppama Challenge? Japan-led Global Team : Japan : China, Mexico, etc. Production power, QCD* * Q: Quality C: Cost D: Delivery Time 7 Battles among Global Teams Oppama is the leader. Company A Production power, QCD E C D Developing countries A B E C D Europe US A B E C D Japan Oppama B Top runner Nissan Company B 8
Our activity of Monozukuri Breakthrough by Integration <Before> NIMS -Friction conveyor -Strike-zone IT -Automatic Guided Vehicle -Simulation Genba kanri (shop floor management) -Job allocation -Ergonomics NIMS: Nissan Integrated Manufacturing System <Current> NIMS -Friction conveyor -Strike-zone IT -Automatic Guided Vehicle -Simulation Integration Genba kanri (shop floor management) -Job allocation -Ergonomics ifa: integrated Factory Automation 9 Accumulation of Monozukuri V3P: New Development Process Value Up Innovation of Product,Process&Program 20.75 months ->10.5 months (from design freeze to start of producti on) Foundation Unique technology & expansion Management reform & return to origin Accumulation of Monozukuri Yoshisuke AIKAWA 1910 1933 33 創 Foundation 業 61 Oppama 64 Zama 68 Tochigi 75 Kyusu 83 Spain, US 86 UK NPW start Integration of NPW, NIMS & V3P 02 NIMS introduction 03 V3P introduction 99 Ghosn management 1960 1970 1980 1990 1994 2006 10
Nissan s Global Strategy Oppama Challenge Global Deployment 11 Global Deployment Global Friendly Competition (Internal benchmarking) Up to 2004 Japan US Providing Know-how Mexico Web-type Since 2005 UK Spain Affiliates 12
Global Deployment Web-type Global Friendly Competition UK Sunderland plant Sept. 06 - US Smyrna plant Mar. 06 - Spain Barcelona plant Mar. 06 - Affiliates China Huado plant May 06-13 Global Deployment 3G + 1 Strategies Production trial Start of production Constitution improvement Trial quality improvement Support for Launch 3G Strategies Global Training Center Global Production Engineering Center Global Launching Expert Global Package Design Center 14
Aim of GPEC Launching Quality Assurance by Improving Initial Quality Digital process Production trial Start of production Shipping quality GPEC GPEC Good NIMS IBAS Integration V3P -Digital -Network Before Engineering trial #1 Production trial #2 Production trial #3 15 Activities of GPEC Quality Evaluation with Data & Data Transcription to Mass-production Evaluate quality based on the data in digital phase. Decide conditions for good assembly parts. Data, tooling and operation procedures are transcribed to production plants. 16
Aim of GPDC Efficiency improvement in logistics by digitalization Digital process Production trial Start of production Digital package design Physical confirmation BMPR REINF ASSY Quality confirmation, such as vibration test 17 Aim of GLE Diagnose/evaluate preparation status & give practical support Production trial Start of production Finding issues Enrolment: 764 (as of FY06) Diagnose capability Function Support trials & production preparation Kaizen activities Process Support initial quality control Press Body Paint Plastic Assembly Final Genba kanri Quality analysis Quality variation Vehicle quality assurance Parts quality assurance Equipment reliability SCM/logistics Solving issues 18
Aim of GTC Constitution improvement 20 people (as of Nov. 2006) Globa l Master Trainer 200 people (End/2006) Master Trainer Local Trainer Operator Japan GTC Overseas plant RTC (Regional Training Center) Overseas plants develop human resources autonomously as utilizing Master Trainers. Possible to train 20 times faster than former direct training 19 Global Standardization of Training Tools Best practices are implemented to all sites UK Spain China Thailand Japan Mexico US Indonesia South Africa 20
Visualized Instructions Proper procedures and key points are visualized. 21 Quality Evaluation of New Vehicles in Developing Countries Success of the Livina Geniss in China New vehicle quality evaluation 80 60 Good 40 Model A Japan Model A China 20 0 Livina Geniss China Engineering Engineering Production Production Trial 開 発 試 #1 作 #1 Trial 開 発 #2 試 作 #2 Trial 生 産 #1 試 作 #1 Trial 生 産 #2 試 作 #2 22
Nissan Production Way ~ Two never ending Never ending synchronization (Douki) our manufacturing with the customers Never ending quests to identify problems and put in place solutions 23 ifa>c Tour ifa Activities in Oppama March 1 st, 2007 Shohei Kimura General manager of Oppama Plant Nissan Motor Co., Ltd. ifa>c Tour Marc h 1, 2007 24
What is Oppama Challenge? World s No.1 Monozukuri This is the Survival Strategy for the Oppama plant to recover production volume. Through benchmarking with mini-cars and LCC* and in stronger cooperation with genba (shop floor) and engineering, we quickly reform Monozukuri to aim at becoming the world s No.1 plant in terms of Quality, Cost and Time. United with internal related departments and our business partners (suppliers, logistics companies, etc.), we lead the reform to quickly communicate it to plants both at home and abroad. With this reform, we will sweep away all doubts about cost competitiveness of Japanese plants and will greatly contribute to improve the level of Nissan s Monozukuri. With the World s No.1 Monozukuri, we will produce global cars in order to break away from being an exclusive domestic plant. *LCC: Leading Competitive Countries 25 What is ifa? integrated Factory Automation Integration Integration of production genba & logistics Integration of plant & supplier Integration of IT (information technology) & genba Integration of IT, design and production preparation Integration of equipment fabrication & production Integration of processes 26
What is ifa? Smooth Material Flow + Low Cost Automation Introduce low cost automation. *Karakuri = automation with wisdom To create the status where nothing stagnates but everything flows smoothly as looking into material flow = Status with no waste * What is Karakuri? 27 What is ifa? (examples) Smooth Material Flow <Conventional operation> Wastes <Assembly workers operations> - Assemble - Select & identify parts - Walk to pick up parts - Return empty boxes Concentrate all wastes of assembly workers to make them obvious. Look into material flow Complex mechanism is needed, resulted in high investment in automation. 28
What is ifa? (concrete example) Low Cost Automation <Kitting supply> <Assembly workers operations> Only assembly Consolidate material flow (1 flow line, 1 packaging style) Possibility for automation can be expected. Low cost automation is realized. - Introduce AGV (automatic guided vehicle) - Automatic transfer of containers (Karakuri) 29 ifa Promotion System in Oppama Challenge Members from each section and plant Watanabe SVP Kimura Plant Manager Kyushu plant <Oppama plant> Manufacturing Dept. Genegal Manager Manufacturing Section ifa Project Team Maintenance Section Nissan Shatai Tochigi plant Engineering Section Production Control Section Production Engineering Development 30
ifa Kaizen Improvements in Oppama Plant (Assembly) Kitting box automatic transfer device (Utilize existing power) (Assembly) Automatic tool up-anddown (near at hand) (Body) P/SHELF automatic setting Total: 113 items <Body> Rear panel automatic setting (fixed point supply) 31 Global Deployment of ifa <ifa Seminars> Other Japanese plants (Seminar at Oppama) UK & US (Seminar at Oppama) Spain & Mexico (Seminar at Oppama) UK & Spain (Follow-up at each local site) Mexico (Follow-up at local site) <Global Deployment Examples> UK Sunderland plant US Canton plant Mexico Aguascalientes plant Spain Barcelona 32