Nissan Motors SWOT Analysis 2016
Nissan is the second largest automaker in Japan after Toyota. Last year, it sold more than 5.4 million vehicles globally. On the other hand, Renault-Nissan alliance had a global sales of more than 8.5 million vehicles. Its strong performance was based mainly on its record sales in US, China and Europe. Despite the macroeconomic slump in Russia and Brazil, the group’s sales globally kept steady. In US, they grew by 7% from 2014. Cheap gas prices and low interest rates led to impressive sales. These factors fueled a rise in the sales of SUVs and trucks.
However, its Leaf Electric car’s sales fell due to low gas prices. India and China have emerged as profitable markets for the Alliance. In India specifically, Nissan is enjoying rising popularity. Its focus has been on technological innovation. It released a semi autonomous driving technology – pro-pilot. Pro-pilot differs from automated driving. It can assist drivers in some specific situations. Nissan has especially focused upon safety and style in its models. In India, it emerged as the best selling European brand. However, it leads in the zero emissions category too.
CEO: Hiroto Saikawa
Competitors: Toyota, Ford, Hyundai, Honda, Chevrolet, GMC, Maruti, Volkswagen
- Fast growing brand awareness and reputation globally.
- Innovative technology
- leader in zero emissions
- Strategic partnership with Renault and Russia’s Avtovaz
- Excellent sales and financial performance worldwide
- Nissan’s reputation is growing fast globally. In 2015, the brand made impressive sales world wide except in a few markets. Its performance has been great in Asia and US. In US, sales of SUVs and trucks mainly drove its growth. The brand focuses on innovative technology and safety. It released a semi autonomous driving technology called pro pilot that can assist the drivers in specific conditions. A few of its models have seen huge success in India. Its models are stylish and equipped with innovative technology. The result is that its popularity is rising fast. This brings it in competition with Toyota, Honda, Hyundai, Ford etc. The growing markets are very important for all these brands. This is why competition is so intense in the Asian markets.
- The brand’s alliance with Renault and Avtovaz has brought great results. This alliance is the fourth largest car maker in the world. Particularly, Renault Nissan partnership has been a major success. Avtovaz could not generate very profitable results last year. Still, the overall financial performance of Nissan was good. It is a leader in EVs, selling one out of every two pure EVs worldwide. Its LEAF EV is a global bestseller. More than 201,000 pieces have been sold since its launch in 2010. Overall, Nissan has some major strengths which can guarantee it a great future.
- falling sales in home market
- Product recalls
- Nissan’s sales kept falling in its home market. Except it, 2015 proved a relatively profitable year. Obviously, the vehicle maker managed its weaknesses well. Its sales fell in Brazil and Russia due to the macroeconomic slump there. The weaknesses of Nissan are few. It has performed well and sustained its position globally. Some product recalls have troubled the brand. However, it proved Nissan was concerned for passenger safety. Still, product recalls are not good for its image. Nissan might need to be more cautious in terms of product quality. Some more focus on home market is also essential.
- Increasing demand for zero emission vehicles
- Increasing popularity in the Indian markets.
- Growth through acquisitions and partnerships
The demand for zero emission and environment friendly vehicles has grown. This presents an opportunity for Nissan. It is particularly known for its zero emission and environment friendly vehicles. These vehicles are gaining customers’ and governments’ support worldwide. Its popularity in India is another sign of success . Particularly, Duster and Quid models are very popular there. Nissan has become the leading European brand in India. the demand for low cost vehicles has risen. Nissan has introduced some models in this category. It could do better by adding more to its portfolio. Moreover, it obtained excellent results from its partnership with Renault and Avtovaz. More strategic partnerships and acquisitions could help Nissan see faster growth globally.
- Rising prices of raw materials
- Economic fluctuations
- Intense competition globally in the automotive industry
Globally, automotive industry is facing intense competition. Nissan, Toyota, Ford, Honda and Hyundai are rival brands. All of them are engaged in an intense battle for market share. In such a scenario, competitive pressure is a major threat. The competition is mainly based on technological excellence and convenience. Rising prices of raw materials and economic fluctuations also pose a threat. Poor Macroeconomic conditions in Brazil and Russia affected the alliance’s sales there. These threats may be few but require attention. Nissan should remain cautious about product quality. Product recalls can affect its image. Globally, the competition has intensified. However, apart from technological innovation, environment friendliness has also become a key criteria affecting the brands’ performance. Focusing on these areas can help overcome competitive pressure.
Nissan has been doing well. Its sales in Asian and US markets have grown. However, it could benefit by forming new alliances. It can also focus on acquisitions. This will improve its presence globally. Rising prices of raw materials and labor costs can be managed better with partnerships and alliances. Simultaneously, it would need to focus upon its performance in home market. The Indian and Chinese markets are full of potential. Low cost cars can help it gain a larger market share there.