07.26.2011
, BEIJING, China
Dongfeng Motor Co., Ltd. Announces New Mid-Term Business Plan for China
Company to invest RMB 50 billion, increase sales to more than 2.3 million units, launch 30 new products; VENUCIA brand preparing to launch dedicated zero-emission electric car
Dongfeng Motor Co., Ltd. (DFL), Nissan’s joint venture in China, today announced a new five-year business plan to accelerate growth in the world’s largest automotive market.
With investments totaling RMB 50 billion (610 billion JPY/ 8 billion USD), DFL aims to increase sales from 1.3 million vehicles today to more than 2.3 million units by the end of 2015. Over the next five years, the company will launch around 30 products, including preparations to launch a fully electric zero-emission car for the Chinese market under Dongfeng Nissan’s original new brand, VENUCIA.
In May 2008, DFL announced a five-year plan named Plan 13 (“one cubed”), with three key pillars targeting significant growth, operational enrichment and building a trusted company. The plan targeted 1 million units in annual sales by 2012; the company achieved sales of nearly 1.3 million units in 2010.
“Nissan’s strong partnership with Dongfeng Motor Corporation has been the primary driver of its robust growth over the past eight years in the Chinese market” said Carlos Ghosn, President CEO of Nissan Motor. “The new plan, with its investments in capacity, products and innovation, will ensure that China continues to be Nissan’s largest global market.”
Increasing sales and growing share, boosted by VENUCIA
DFL has set a goal of achieving sales of more than 2.3 million units by 2015, an increase of 1 million units from its record 2010 sales volume. The company’s target is to achieve and maintain a 10 percent share of the Chinese market during the business plan period.
Sales of the first passenger vehicle from VENUCIA (Chinese Name: Qi Chen), Dongfeng Nissan’s original new brand, are scheduled for 2012. A total of five new models will be launched from VENUCIA, with annual sales expected to reach 300,000 units by 2015.
Increased production capacity
To achieve the sales target of more than 2.3 million units, DFL will build a new manufacturing facility in Changzhou City, Jiangsu Province, which will produce light commercial vehicles (LCVs). This new facility is in addition to the second production facility for passenger vehicles in Huadu, Guangzhou City, Guangdong Province, which will start operations early next year, and a new plant in Shiyan, Hubei Province, to produce heavy and middle commercial vehicles (HMCVs), which is scheduled to be inaugurated in 2011. DFL will also reinforce its existing facilities, including a second plant in Zhengzhou.
In total, the company will increase its current capacity of 1.2 million vehicles in 2011 to 1.5 million units in 2012 before reaching 2.3 million units in 2015. To support the planned increase in vehicle production capacity, DFL-PV will build new powertrain manufacturing facilities for both engines and transmissions. The company is targeting to reach almost 100% of supplier localization by 2015.
Expanded new products and sales network
To support the new growth strategy, DFL will introduce 30 new vehicles by 2015 to respond to rapidly diversifying customer needs in the Chinese market. The number of dealer outlets will be increased from the current 1400 to 2,400 in 2015, of which 1,000 dealer outlets would be DFL-PV.
First dedicated electric vehicle for Chinese market
Following the new direction of the Chinese government to promote energy-efficient vehicles, the company is preparing to introduce an electric passenger vehicle (EV) under the VENUCIA brand. The car will go on sale by 2015 and will be locally produced in China.
Through the model city pilot program with Wuhan City, Hubei Province, and Guangzhou City, DFL is preparing to contribute to the promotion of EVs in China with know-how accumulated through Nissan’s launch of the first mass-market, 100 percent electric vehicle, the Nissan LEAF, in Japan, Europe and the United States.
“DFL achieved the sales target of the previous mid-term business plan two years ahead of schedule. This is the result of our unique joint venture, integrating the two cultures of Nissan and Dongfeng, offering timely products and services that satisfy the needs of every stakeholder, from customers and employees to suppliers and investors,” said Kimiyasu Nakamura, president of DFL.
DFL and Nissan sales targets in China: 2011 / 2015
- DFL (PV+LCV+HMCV): 1.35 million / more than 2.3 million
- Nissan (PV+LCV+Imported model): 1.15 million / more than 2.0 million
Dongfeng Motor Co., Ltd (DFL)
Dongfeng Motor Co., Ltd. was established in 2003 as a result of a comprehensive, strategic partnership between Dongfeng Group and Nissan Motor Co., Ltd. DFL is the first joint venture in China to have a full lineup of passenger vehicles, LCVs and HMCVs, and has grown faster than the total market in China. Registered capital of the company is RMB 16.7 billion, the largest automotive joint venture investment in China, with Dongfeng and Nissan each holding a 50 percent stake.
Dongfeng Nissan Passenger Vehicle Company (DFL-PV)
Dongfeng Nissan is a business unit of Dongfeng Motor Co., Ltd., Nissan’s joint venture with Dongfeng Motor Group Co., Ltd. Dongfeng Nissan is engaged in research and development operations, manufacturing and distribution of passenger vehicles.
Nissan Motor Co. Ltd. and its business in China
Nissan Motor Co., Ltd., Japan’s second-largest Japanese automotive company, is headquartered in Yokohama, Japan, and is part of the Renault-Nissan Alliance. Operating with more than 248,000 employees globally, Nissan provided customers with more than 4.1 million vehicles globally in 2010, generating revenue of 8.77 trillion yen. China is the largest single market for Nissan, representing nearly a quarter of its total global sales. Nissan started its full-scale operation in the Chinese market in 2003 with the establishment of Dongfeng Motor Co., Ltd. Nissan launched its luxury brand, Infiniti, in China in 2007. Nissan’s sales volume, including both passenger and light commercial vehicles, has risen from 94,000 units in 2003 to more than 1 million units in 2010. For 2011, Nissan is targeting sales of 1.15 million vehicles in China.
Note: Amounts in Japanese yen are translated for the convenience of the reader at the foreign exchange rate of RMB 1 per 12.2 Japanese yen or 0.16 USD.
* DFL and Nissan sales targets in China