Nissan will solve its quality problems in order to grow even further

Article by Christian Andrei, on July 4, 2011

In the last business plan for Nissan as presented by Chief Executive Officer Carlos Ghosn, quality was the core. However, in the new plan announced last week, it was a bit player despite the fact that the quality issues of the brand are far from resolved. According to two major studies made by J.D. Power and Associates, Nissan quality has improved marginally since the CEO’s GT 2012 business plan of 2008.

However, both studies revealed that the company continues to creep along below the industry average. Specifically, it has lower rankings than in 2008 due to the rapid improvement of its rivals.

Last week’s plan, dubbed as the Power 88, is said to have put additional strain on the quality issues of the brand, as it intends to ambitiously grab 8 percent of international market share by the spring of 2017, an increase from its current 5.8 percent, while launching new vehicle models and innovations at a faster pace.

According to the 2011 Initial Quality Study of J.D. Power made public in June, Nissan dropped to No. 24 from No. 12 in 2010 and from No. 19 in 2008, based on the complaints from vehicle buyers during their first 90 days of ownership.

Furthermore, in J.D. Power’s U.S. Vehicle Dependability Study, Nissan was No. 25, which was the same as last year but down from No. 18 in 2008. The study measures problems experienced by original owners of 3-year-old vehicles during the past 12 months.

While Ghosn pursues to grab 8 percent of the international vehicle market, Toyota looms as a cautionary tale as its massive recalls in 2009 and 2010 were linked to the ambitious growth that the company pursued after its former President Fujio Cho set a target of 15 percent of the international market share.

In Ghosn’s plan revealed last week, he admits that although the company had a lot of improvements, it still has a lot of potential to improve.

Topics: nissan

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