José Román was about to complete his third year as a global leader of Datsun, in Tokyo, when in early 2019, he was offered the presidency of Nissan Mexicana, the fourth largest operation of the brand globally and one of the most vetted by the corporation. “It is a benchmark within Nissan Corporation. Although it is not the largest operation, it is a benchmark in manufacturing and sales. Everyone in Japan is aware of what happens in Mexico every day, ”he says. He didn’t think twice.
The Ecuadorian manager already lived in Mexico in 2012, when he was regional vice president of Sales for Nissan Mexicana. Following this assignment, he was appointed managing director of Nissan for Latin America and the Caribbean, and then became the global leader of Datsun, in 2017. “Although I was very good in Japan, promoting the Datsun brand in very difficult markets, Mexico was a market to which I wanted to return ”, he says.
Román returned to Mexico in July 2019 with the task of consolidating the brand’s operations and laying the foundations to guarantee the profitability of the business for the next 20 years. The challenge was no less, as the market was going through a difficult time: exchange rate volatility, inflation and customer debt had reduced car sales since mid-2017.
Nissan lost 4.5 points of market share between 2016 and 2019 and when Román arrived in Mexico only five percentage points separated him from General Motors, its closest competitor. The advantage that the Japanese brand had achieved 10 years earlier, amid the 2009 crisis that put US manufacturers on the brink of bankruptcy, was fading.
It seemed that the market situation had bottomed out. But an unexpected pandemic in the spring of 2020 plunged the sector into the biggest crisis in 80 years. “Nobody trains us at the university for these kinds of situations,” Román said in April of last year, when the confinement halted production for two months and reduced sales by a third. The leader of the brand, the best-selling in Mexico, had to learn on the fly to manage, from a ‘healthy distance’, an operation that includes three vehicle plants, a joint venture with Daimler in Aguascalientes, a brand finance company, a technical center and 15,000 jobs.
Nissan had considered months before to renew 60% of its product offering with a clear focus on volume models, such as Versa, Sentra, March, Kicks and Frontier. “Before, all models were without major background changes for six or seven years, but now consumer habits have changed very quickly. Nissan had to make a very strong and very fast change in its entire portfolio because it was lagging far behind, ”says Gerardo San Román, president of the Jato consultancy.
All these models are assembled in Mexico and their renovation required Nissan to invest, from the last quarter of 2019 to the beginning of 2021, 642 million dollars. The renewal of the five models, which are exported to North, Central and South America, also boosted investments from fifty suppliers. Some opened new plants, others expanded their operations driven by the new T-MEC, which raises the percentage of regional components that cars must have to be marketed without tariffs.
In addition, Nissan streamlined its digitization strategy. The brand closed 2020 with an online section system and with a renewed product offer that allowed it to increase its market share by two tenths, up to 20.5%. “It seems little, but winning a tenth of a point in a market as competitive as Mexico is very hard,” says Román. “We are strengthened because in times of crisis customers often turn to the brands they already know.”
A game of chess
2021 began with an optimistic forecast. However, the start of the year has been no less challenging than it was in 2020: a global semiconductor shortage, the gas cut in February due to bad weather in Texas and a subsequent shortage of resins and polymers have caused the temporary closure of plants in North America. In Mexico, Nissan had to stop production in Aguascalientes for several days in May, where it assembles the Versa and the Kicks.
“This is all like a game of chess, we are thinking about each move at the same time. Now we cannot plan in the medium term, we do it almost daily, ”says Román. “But we hope that this will not last more than three months,” he adds.
Roman always looks beyond the car in front, he already has his eyes and his mind in the medium and long term. “We are very happy to be the number one brand in Mexico, but that position is not assured nor does it guarantee future success. When they sent me to Mexico, they gave me the mission of preparing the network and the business for the next 15 to 20 years, ”he says.
In the medium and long term, electrification, digitization and autonomous management will transform the industry. “The generations to come have a different mentality. My task is to prepare Nissan for this. We are here to stay for 50 more years ”, says the manager.
