Nissan Motor Co., Ltd. December 2, 2010 Chief Operating Officer Toshiyuki SHIGA 2010 Nomura CEO Forum first-half performance/ outlook Environment for auto industry Nissan s strategy for growth 1 2010 Nomura CEO Forum
Key performance indicators: Financial results (billion yen) Net revenue Operating profit Net income Free cash flow (Auto) Net debt (Auto) +27.7% 3,383.4 4,319.1 +252.9% 334.9 293.3 94.9 +2,215.9% 208.4 149.7 215.7 9.0-69.3 2 2010 Nomura CEO Forum first-half sales performance: Global 31.38 TIV* 35.93 2.54 7.33 (6.08) Change vs. All regions +14.5% Japan North America (US) +16.8% +8.0% (+8.3%) Retail volume 1,623 2,009 328 Change vs. All regions +23.8% Japan +15.3% (million units) 8.86 8.21 Europe China -3.5% +45.6% (thousand units) 580 (445) 277 503 North America (US) Europe China +11.8% (+9.8%) +12.6% +51.4% 8.99 Others +18.4% 321 Others +32.9% *Nissan s estimation 3 2010 Nomura CEO Forum
first-half financial performance (billion yen) Operating profit Non-operating Ordinary profit Extraordinary Net revenue 3,383.4 94.9-61.7 33.2-12.9 334.9-19.8 315.1 +281.9 0.4 Variance 4,319.1 +935.7 +240.0 Change vs (%) +27.7% +252.9% +848.8% Profit before tax 20.3 Taxes -11.6-91.4 Effective tax rate (56.9%) (29.0%) Minority interest 0.3-15.7 Net income 9.0 208.4 315.5 +295.2 +199.4 +1,455.9% +2,215.9% FX rate 95.5 JPY/USD 133.2 JPY/EUR 88.9 JPY/USD 113.8 JPY/EUR -6.6 JPY/USD -19.4 JPY/EUR 4 2010 Nomura CEO Forum (thousand units) outlook Retail volume 3,515 630 1,067 (824) 509 756 553 3,800 600 1,205 (945) 510 860 625 Previous Outlook 4,100 615 1,220 (945) 600 960 705 Revised Outlook Global +16.7% Japan North America +14.3% (US) (+14.7%) Europe China Others vs. -2.4% +17.9% +27.1% +27.5% vs. Prev. Outlook +7.9% +2.5% +1.2% (±0.0%) +17.6% +11.6% +12.8% (thousand units) Production volume 3,282 1,025 837 445 756 219 3,750 1,100 990 410 850 400 4,050 1,140 1,020 510 950 430 Previous Revised Outlook Outlook Japan North America +3.6% +3.0% Europe +14.6% +24.4% Others vs. Prev. Outlook Global +23.4% +8.0% China vs. +11.2% +21.9% +25.7% +11.8% +96.0% +7.5% 5 2010 Nomura CEO Forum
outlook (billion yen) * Variance Net revenue 7,517.3 8,770.0 +1,252.7 Operating profit 311.6 485.0 +173.4 Ordinary profit 207.7 450.0 +242.3 Net income 42.4 270.0 +227.6 CAPEX sales ratio R&D sales ratio FX rate assumption (JPY/USD) 273.6 3.6% 385.5 5.1% 92.9 (JPY/EUR) 131.2 340.0 3.9% 425.0 4.8% 84.4 (2H: 80.0) 111.9 (2H: 110.0) * Forecast 6 2010 Nomura CEO Forum first-half performance/ outlook Current environment in the auto industry Nissan s strategy for growth 7 2010 Nomura CEO Forum
Environment in the auto industry Rapid growth in emerging countries Affordability, down sizing Urgency for development in environment technology Shift to alliances to compensate own weakness Ascent of Korean makers and powers from emerging countries Decline in competitiveness of Japanese industries in global arenas 8 2010 Nomura CEO Forum Global TIV evolution (actual and forecast) 80,000 (thousand units) 60,000 40,000 20,000 Japan/US/Europe 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 9 2010 Nomura CEO Forum
Number of vehicles owned per 1,000 persons US Germany 800 France Japan UK ドイツ Russia Brazil China India <50 150 中国 250 600 米国 Vehicle ownership in emerging countries with large populations, such as China and India, is still low, allowing opportunities to expand in those markets. 0 200 400 600 800 1,000 (units) 10 2010 Nomura CEO Forum Oil production has reached its peak Consumption (M bbl) 40000 30000 20000 10000 The 19st century The 20st century The 21st century Oil Consumption 2009 28400M bbl Oil Production 2009 28000M bbl Oil Consumption for Vehicles 1850 1900 1950 2000 2050 1859 First Modern Oil Well 1908 Ford Model T 11 Calculation based on BP figures, WBCSD SMP reports, IEA WEO, and JPDA sources 2010 Nomura CEO Forum
Global warming: Long-term targets for CO2 reduction Need to keep CO2 concentration below 450ppm To achieve 450ppm, need to reduce CO2 emission from all new vehicles by 90% by 2050 (vs. 2000) 100 New car s Well To Wheel CO2 emissions (%) 80 60 40 20 450ppm 90 % Reduction 0 2000 2010 2020 2030 2040 2050 12 2010 Nomura CEO Forum Well to wheel CO2 emission The ultimate measures are zero emission vehicles and clean energy 100 New car s Well To Wheel CO2 emissions (%) 80 60 40 20 0 Renewable hydrogen Renewable electricity ICE Diesel HEV FCV EV Zero emission 13 2010 Nomura CEO Forum
Era of Renewable Energy Time to utilize electric energy that can be generated in a short amount of time Regenerating Fossil fuel Biofuel Electrical energy Storage Drive Energy 14 2010 Nomura CEO Forum first-half performance/ outlook Environment in the auto industry Nissan s strategy for growth 15 2010 Nomura CEO Forum
Significant changes in the automotive landscape New growth strategies are now required Emerging markets Affordable, compact car Environment technology 16 2010 Nomura CEO Forum Strategies to address new challenges Actions to address rapid growth in emerging markets Global compact car:challenge to Monozukuri Zero emission leadership 17 2010 Nomura CEO Forum
Emerging market offensive: China Established the biggest automotive joint venture in China in 2003 Production capacity (k units) (2 shifts) Zhengzhou DFL Huadu DFL Xiangfang DFL Xiangfang DFAC 885 200 390 >1,200 240 618 135 165 160 185 Current CY12 Sales volume (k units) 179 297 363 458 545 756 960 CY04 CY05 CY06 CY07 CY08 CY09 CY10F 18 2010 Nomura CEO Forum Emerging market offensive: India Established 200 K new plant to immediately capture export business and domestic market Alliance plant Europe Middle East Africa Chennai Will start exporting to 100 countries including Europe from late 2010. Planned export volume for 2011 is 110,000 units. 19 2010 Nomura CEO Forum
Emerging market offensive: Russia Increase Alliance market share to 40% Increase Alliance market share to 40% St. Petersburg production Synergy with Avtovaz X-TRAIL Teana Murano Production capacity: 50 k units Platform commonization Mutual usage of production facilities 20 2010 Nomura CEO Forum Affordable transportation: Global compact car Challenge to Monozukuri in emerging countries Challenge to Monozukuri in emerging countries 3 products by FY12 Accessible eco-friendliness New XTRONIC CVT 3-cylinder Super-charged engine All are produced in LCC(Thailand, India, China and Mexico) 21 2010 Nomura CEO Forum
Zero emission leadership Nissan LEAF The word s first truly practical and affordable 100% electric zero-emission car 22 (C) Copyright NISSAN MOTOR CO., LTD. 2010 All rights reserved. Preparing for mass-marketing EVs Sunderland, UK Flins, France Zama, Japan Aveiro, Portugal Oppama, Japan Smyrna, USA 500,000 battery and assembly capacities 5 battery plants 23 2010 Nomura CEO Forum
Change Surrounding Industries EV creates new business opportunities. Management Management of of electricity electricity Charging Charging infrastructure infrastructure Expansion Expansion of of natural natural energy energy use use Smart Smart House House Secondary Secondary use use of of battery battery Amplification Amplification of of charging charging stations stations Synergy with service industry Synergy with service industry Business Business related related to to EV EV parts parts New mobility business Expansion Expansion of of power power electronics electronics components components Equipment Equipment related related to to infrastructure infrastructure Car Car sharing sharing Cooperation Cooperation with with public public transportation transportation facilities facilities 2010 Nomura CEO Forum Nissan s approach for the environment Technology pillars Nissan LEAF EV Series Idling Clean Hybrid Stop Diesel Low CO2 (Low-fuel Consumption) 25 2010 Nomura CEO Forum
Nissan s approach for the environment First PURE DRIVE vehicle: March Nissan's newly developed 3-cylinder HR12DE engine New-generation Xtronic CVT "Idling Stop" system to help reduce gasoline consumption Best-in-class fuel economy of 26.0km/L 26 2010 Nomura CEO Forum Nissan s approach for the environment Second PURE DRIVE vehicle: X-TRAIL Clean diesel:complies with Japan's stringent "Post New Long-term Regulations" emission standards(sept 2008, MT model) The X-TRAIL "20GT" is powered by the 2-liter "M9R" Clean Diesel engine with the addition of the new "20GT" 6-speed automatic transmission 27 2010 Nomura CEO Forum
Nissan s approach for the environment Third PURE DRIVE vehicle: Fuga Hybrid Nissan original one-motor two-clutch parallel hybrid system Fuel economy of 19.0 km/l Intelligent Dual Clutch Control lithium-ion battery 28 2010 Nomura CEO Forum Nissan s approach for the environment Fourth PURE DRIVE vehicle: Serena Equipped with Nissan's new Idling Stop system Due to its ECO motor, the engine restarts quicker and is more quiet, resulting in a natural driving feel and best-in-class fuel economy of 15.4km/L 29 2010 Nomura CEO Forum
4 key measures to mitigate impact from Yen appreciation and maintain NML Monozukuri competitiveness Yen cost reduction MFG cost reduction Reduction in fixed costs, G&A, R&D costs and NML expenses Yen cost avoidance Yen revenue increase Yen cost absorption through pricing Multi-sourcing, localization, imported parts, off-shore outsourcing Enhance sales volume in JPN market (15% in 2013) OEM sales Pricing opportunities Branding 30 2010 Nomura CEO Forum Multi-sourcing Europe Japan North America Middle East Others JPN Australia Product origin IND KOR US THAI MEX EUR 31 2010 Nomura CEO Forum
生き残る種というのは 最も強いものでもなければ 最も知的なものでもない 最も変化に適応できる種が生き残るのだ ( チャールズ ダーウィン ) 成長を続ける種というのは 変化に対応するだけでなく 自ら変化を起こし 自ら進化することができる種である 32 2010 Nomura CEO Forum 32 33 2010 Nomura CEO Forum