Nissan COO: ‘The relation with Renault has never been this strong’

Ashwani Gupta, a lively Indian in his early fifties, has the most difficult task at Nissan: making the failing Japanese number two profitable again. At Nissan, he’s COO, member of the board, director of operations, and performance. In short, he’s the duty fire officer.

Gupta and the newly appointed Luca de Meo at Renault have a lot in common, says the energetic Indian. “Luca loves cars, and so do I. Luca loves brands and products, the same goes for me. Luca is interested in people, it’s so refreshing to work with him.”

Huge task

Bringing Nissan back in the green is a huge task. For its fiscal year 20-21, Nissan foresees a €5,4 billion loss, the same as the year before. It hopes to become profitable again somewhere in 2022. To achieve this, the restructuring plan Nissan Next has been started, planning a 20% reduction in costs and capacity, and led by Gupta.

“The plan is on its way. We will focus on our key markets (Japan, China, US) and new products. But what we really want to change is the culture within. We want to pass from a volume culture to a culture of values, just like our partner Renault.”

“In the past, we have pushed for volume, thinking that we were able to sell seven million cars or more every year. We never sold more than five. The return to profitability has to come from this new culture of values. And these values are generated by profitable sales, by technological progress, by new sales. That’s the new Nissan.”

Nissan-Renault

Put it in another way, it’s bye-bye to the ‘folly of greatness’ of the former big boss Carlos Ghosn. Gupta points out that the relations between Nissan and Renault have been revived by Jean-Dominique Senard, president of Renault, and of the Alliance.

“In fact, I’m the oldest member of the Alliance direction, and I can assure you that the relations between Nissan and Renault are at present the best I’ve ever known in fourteen years.” Gupta entered the Alliance board in 2006 via Renault-India.

“Since his arrival at Renault in July, I already had six work meetings with Luca de Meo. Just last week, we launched five common projects,” adds Gupta. He’s also not afraid to give his comments on Nissan’s situation in Europe.

“Given our market share of 2,5% in Europe, we can’t afford any longer to have two factories on the old continent. So, we will close Barcelona, but Sunderland is another story. It’s our most performant plant; it’s part of our history.”

Leader-follower

In Europe, Nissan will be a follower in the new leader-follower strategy of the Alliance. “The current Nissan Micra is produced in France by Renault on a Nissan platform,” explains Gupta. “But it’s in a segment and in a region where Renault is leading. For the next Micra, we will ask Renault to develop and produce the car for us. And the same will happen with our commercial vehicles in Europe, where our French partner also leads.”

Is there a risk of losing engineering capacity and knowledge in this? Gupta denies. “You mustn’t confuse the leader-follower principle and loss of competences. The principle is that the partner who dominates a segment or region takes the lead, but everybody else is seriously involved in the project.”

According to Mr. Gupta, the benefits of this strategy are innumerable. “In China, Renault still sells light commercial vehicles with the assistance of Nissan, In Argentina, Renault produces the Frontier pickup for Nissan; in our home town Yokohama we produce parts of the E-Tech engine for Renault.”

“We have dozens of opportunities to work together. Thanks to Mr. Senard, the relationship between Nissan and Renault has never been as tight. The way the Alliance works has never been this clear. It’s clear as crystal.”