Nissan chief executive Carlos Ghosn told shareholders yesterday that the Japanese automaker's board members will forgo their bonus pay to take responsibility for poor performance.
Ghosn acknowledged at a hall packed with more than 2,100 shareholders, a record attendance for Nissan, in Yokohama, south of Tokyo, that the company had not met its targets last year.
"We are taking our responsibility seriously," he said.
In the fiscal year ended March, Tokyo-based Nissan Motor Co marked its first profit drop in seven years -- the first time earnings have slid under the turnaround efforts led by Ghosn.
Ghosn told reporters after the meeting that Nissan was not in talks with any automaker now about expanding the alliance it already has with Renault SA of France.
"Today, our shareholders, both from Nissan and Renault, consider that extending the alliance is more a risk than an opportunity," he said.
He also said he had no interest in buying the Jaguar and Land Rover luxury European brands that Ford Motor Co has expressed interest in selling.
"Did you see the price of the brands?" he said. "How are you going to create the returns on this kind of investment?"
Earlier at the meeting, Ghosn tried to assure shareholders by saying that Nissan was investing aggressively in the future, including opening plants in emerging markets, introducing new models, developing green technology and building brand image.
This year "will be a better year for Nissan," he said.
Most shareholders were quietly attentive, but a few aggressively questioned Ghosn, even heckling him from the floor at times.
Such behavior is not particularly unusual at Japanese shareholders' meetings.
Grilled with questions about whether Nissan was falling behind in product quality and ecological technology, Ghosn told shareholders he was confident that better times were ahead, and that the problems were temporary.
One shareholder stood up and demanded Ghosn resign to take responsibility for failing to meet his own "commitments."
Others said that Nissan had fallen behind in quality surveys, did not have stylish cars like Honda, and needed to adopt a better emblem design.
A key part of Ghosn's revival program at Nissan was to have the automaker at all levels from top management to the line worker set performance targets and then try to meet them.
Ghosn, also chief executive at Renault, has consistently met or outpaced his own targets -- until recently.
He told shareholders that Nissan has announced that it needs an extra year to meet its much publicized annual global sales target of 4.2 million vehicles, initially set for the fiscal year ending March 2009.
For the just-ended fiscal year, Nissan's profit fell 11 percent to ¥460.8 billion (US$3.9 billion), and the company sold 3.48 million vehicles worldwide, a decrease of 2.4 percent from the previous year.
Nissan expects profit will grow more than 4 percent to ¥480 billion in the fiscal year through next March.
Ghosn also said that Nissan was working on a super-cheap US$3,000 car specifically for the Indian market, adding that the date for its sale was still undecided.
Ghosn said the need for such a vehicle is apparent for the Indian market and because a rival has already announced that one was coming.
Nissan Motor Co will work on the car with its French alliance partner Renault SA and a local Indian partner, Ghosn said.
India offers low-cost manufacturing and suppliers that makes it the best place to produce cheap cars, and Indian consumers will likely buy such cars, he said.
It would be "a threat" to Nissan if it didn't work on a US$3,000 car, he said.
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