Renault-Nissan to increase production in South Korea as the yen strengthens
By Andrew, 01 Sep, 2010. 0 Comments
2011 Renault Latitude
As the yen strengthens, Renault-Nissan seeks to raise production in South Korea to cut their dependence on Japan as a manufacturing base, CEO Carlos Ghosn told reporters in Abu Dhabi last Monday. Ghosn added that as the yen strengthens and as the yuan becomes more competitive, “those who have capacity in Korea today have a plus.” He added that if the exchange rate gets erratic, the company doesn’t get caught with all the “eggs in the same basket.” On August 10, Renault said that it is considering ways to expand its business in Southeast Asia after withdrawing its bid for Ssangyong Motor Co., which is operating under bankruptcy protection.
Korea's Renault Samsung Motors Co., which is 80% owned by Renault, runs a plant in Pusan that exports the Nissan Sunny to the Middle East. Ghosn said that Nissan is exporting 50,000 cars each year to the Middle East from its South Korean plant. Separately, Renault uses the factory, with a capacity of up to 240,000 vehicles, to increase production of a “Latitude” version of its SM5 sedan for export to the Middle East and Europe. Toyota Motor Corp. said that each one-yen increase in the Japanese currency against the dollar cuts Toyota Motor Corp.'s annual operating profit by 30 billion yen ($354 million). Sony Corp., which delivers over 70% of revenue outside of Japan, revealed that it loses about 2 billion yen of annual operating profit for each yen gain against the US currency. Based on Bloomberg Correlation-Weighted Currency Indexes, the yen has advanced 14% this year -- the highest gain among the currencies of the developed world. [via autonews - sub. required]
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