Nissan to raise prices in Russia
Nissan Motor Co., which along with partners Renault SA and OAO AvtoVAZ has the biggest market share in Russia, has stopped taking orders for some models in the country and will keep raising prices if the ruble continues to slide.
The automaker also plans to increase production in Japan and boost exports from the country to benefit from the weaker yen, Carlos Ghosn, chief executive officer of Nissan, told reporters today at the company’s headquarters in Yokohama, Japan. Nissan will still stick to its long-term strategy of locating as much as production where the cars are sold, he said.
The Nissan-Renault alliance is more exposed to Russia — where the currency has plunged almost 50 percent this year — than any other carmaker after gaining control in June of OAO AvtoVAZ, the maker of Lada cars. The group controls 33 to 35 percent of the Russian car market and is targeting 40 percent by 2016, Ghosn said. That goal is being threatened by a slump in industrywide sales this year.
“When the ruble sinks it’s a bloodbath for everybody,” Ghosn said. “It’s red ink, people are losing money, all car manufacturers are losing money.”
Nissan is producing 70 percent of the cars sold in Russia locally and plans to raise the ratio to 90 percent by 2016, according to the company.
In Japan, Ghosn expects exports from the country to rise next year and to use more local capacity to take advantage of a weaker yen. Prime Minister Shinzo Abe’s efforts to fight deflation in the world’s third-largest economy have helped drive the yen to a seven-year low against the dollar this month.
The yen’s weakness “is a tremendous boost to our competitiveness,” Ghosn said. “As a consequence of this, obviously we will better use our capacity in Japan.”