Posted by: Ian Rowley on April 28, 2006
After attacking “cookie cutter” designs at the New York auto show earlier this month, Nissan chief Carlos Ghosn took another swipe at the commoditization of the auto industry in Tokyo this week. Speaking after the Japanese automaker posted yet more record results, Ghosn expanded on his concerns about the way designs are going. “We as an industry are behaving in a way as if only volume or market share counts. All the pleasure of owning a car becomes secondary. That’s why the creation of value in the industry in general went down,” Ghosn told me at Nissan’s HQ on Wednesday. “When you were a kid or I were kid you could recognize the brand from the looking at the design, but it is impossible now.”
Ghosn also reiterated his disquiet the industry’s reliance on incentives to strike deals. “We’re giving the consumer the impression that this is the mattress business or this is the Persian rug business,” he added. “I’m trying to get Nissan out of it and I’m trying to get Renault out of it. I’m saying don’t go after the volume, don’t go after share. Go after loyalty, go after brand, bring back emotion to the car industry and the consumer will reward you.” A day earlier Ghosn showed the rewards Nissan is getting. The company posted earnings of $4.57 billion for the year through March, an increase of 1.1%. Still, Nissan’s earnings would have been even higher if sales expenses, mainly due to higher incentives in the U.S. market, hadn’t risen by around $450 million.