Ghosn, Ghosn, Gone??

h00ligan · #1 (**permalink**) 10-02-2006, 09:05 PM

UPROOTING FROM SOUTHERN CALIFORNIA BACKFIRES ON NISSAN! BAD MOVE NISSAN!!!!!!!

Ghosn, Ghosn, Gone??

Editorial

Well, you hear the rumors, but you can choose to believe them or not. Carlos Ghosn going to GM? Or at least meeting them in Paris to discuss ‘partnership’? GM and Ford getting together with Nissan? Two car companies in trouble and here comes Carlos to save the day. Not so fast you say? True enough, Carlos convinced Japan to give him unilateral power to ‘save’ the company. His first great quote, “….The is no car company problem that can’t be solved with great product…” came as he surrounded himself with some great people and they produced great product.

Now that things are heating up – the latest Ghosn quote seems to be a 180 from the previous one. “…There is no car company problem that can’t be solved by great management…” Well, let’s shed some light on this apparently new shift in paradigm. Great People – Nissan put a team together that wrung out everything they could get from the great ‘Z’ and put most likely another 10 years into the product. Just using the VQ engine platform in so many chassis’s was brilliant. The G35, the M and the FX were all show stoppers out of the gate and portend a lot of great things going forward. The personnel behind the design and production of these vehicles and these strategies need to be applauded for their insight. Yet, the culture of cost-cutting has resulted in the current mess with 4 cylinder Altimas and Sentras, a mess that is estimated to cost around $1 BILLION to fix. All because of alleged desire to save 30 cents on piston rings.

Cost cutting – “…There is no car problem that can’t be solved by great management…” Reducing costs was the primary reason given for moving Gardena to Nashville. But that move has turned into a disaster of epic proportions for NNA.

When news of the move leaked to the LA Times in September of last year, almost everybody stopped working on anything meaningful. Of course, obviously they must have started focusing on finding new jobs! Nothing against Nashville, but Southern California is car country. Uprooting families happens all the time, but people in Southern California just view it a little bit differently. Could it be that Nissan NNA deserves all the trouble they've gotten themselves into? Word on the street is they were not honest to begin with. The morning the rumor hit the LA Times the Corporate message was; "it’s just a rumor; no decision has been made" blah, blah, blah. Perhaps it was done so hurriedly that employees would not have enough time to find other jobs and would be forced to move?

The final attrition figures are nowhere near the 43% (or so) NNA spokespeople have been repeating. Their math factors in the fact that they only planned on bringing over 900 jobs; not the 1300 (or so) who were in Gardena the day the announcement was made a year ago. The real figures are 22% retention (actually a fraction higher.) This means that almost 78% of the NNA national headquarters staff has left the company and are now working elsewhere. Even Jed Connelly said he expected about 50% to not make the move. By the way, he is gone, Jack Collins is gone, Steve Wilhite is gone and if we have to tell you who they are – well it doesn’t matter because almost anyone and everyone who was responsible for ‘Great Products’ is no longer working for Nissan nor Infiniti.

(NOTE: Jack Collins informed employees in an official announcement meeting that Jim Morton’s own study showed that, on average, companies lose 50% of their employees when moving to a new state. That figure changes to 35% retention, or 65% lost when the state being left is California. In other words, Nissan NNA KNEW they would have a near-total wipe-out on their hands of the word got out. Which begs the question, is this why they were trying to keep it under wraps as long as they could.)

Some who moved to Nashville say “…it’s nearly impossible to get anything done since Ford/GM and Chrysler "camps" have been set-up and there aren't enough experienced NNA managers to tell anyone how things are supposed to get done. Furthermore, many of the talented people from Gardena are now working for Honda, Toyota, Mazda, Hyundai, Kia, Suzuki, others - and we have to assume, locked in their cerebellum, was vast, detailed knowledge of all of Nissan's future product plans going out many years. Do you think? The cost of this is staggering and will be felt by NNA for a decade or more.

The departure of some key people throughout the Nissan and Infiniti Product Planning teams cannot be replaced easily, no matter how good “the management” is. The entire Infiniti G35 team is gone, as is the core of the GT_R and new Flagship teams. In fact only 2-3 people remain from the entire Infiniti Product Planning team. Include the loss of the 350Z and NISMO management teams and you can predict for yourself where Nissan’s futures lies.

The Cross Car Line teams are almost completely destroyed; only 1 person from the team that handled interior cabin comfort and entertainment systems made the move. The small sedan and truck groups were all but completely wiped out. The whole Frontier/Xterra team is gone as well as the Sentra/Versa team. Where were Human Resources when all this was happening? Cost cutting at the expense of great product? We might add that the loyalty of Nissan enthusiasts rivals those of Ford, Toyota, Honda and Corvette, just to name a few.

Looking beyond just Product Planning, entire departments were almost completely wiped-out. Pricing strategy, Market Insight, Corporate Communications, Model Line Marketing and Corporate Training have been reduced so extensively that many of them were asked to stay on as contractors just to get vehicle launch work completed. Some departments endured a 95% attrition rate, and the departments who are considered to be largely intact lost “only” 50% - 60% of their employees. Nissan’s claims of 43% retention would be a disaster by any definition at any other company.

As for NNA touting the retention of some 80% of their top executives (now closer to 70% after some recent defections), we would have to assume that these people don’t actually know how to do the detailed, day-to-day work. They are not in the trenches where they would have to how to do a price-value comparison document against a competitor. They would have to know how to coordinate several suppliers and engineering groups to bring an accessory to market. They would have to know how to decide which features to include on a vehicle, or in which option package. Good management can be great if they have the resources to do the work.

Nissan’s global leadership needs to be held responsible for what they’ve done to the American business unit – where some 70% of global operating profits are made. Enthusiasts should be very concerned for their favorite brand because deciding to save a buck per engine was more important than making a great engine. And when people like Jim Morton put his young son, in his early 30s, as the head of the NNA finance department, it doesn’t take a rocket scientist to see that “what’s best for Nissan” wasn’t the only thing driving the decision to move.

A shame, isn’t it? Because of this, to wait perhaps ‘till 2012 for some more great products. It will be very difficult for the next few years and there is little hope of them gaining any traction until 2012 model year (due to normal product development cycles.)

And right on the heels of the Nashville move and its ramifications, YTD sales thru August are negative on every model line except Frontier, Murano, and the ‘M’. And in the month of August alone, there are minus signs next to all of them except Sentra, Maxima, and Frontier and Murano! Should we then assume there will be more cost-cutting measures put in place?

Carlos Ghosn, Ghosn, gone? We think he sees the colossal mess he and his buddy Jim Morton have caused and he wants OUT before his reputation as a 1-trick cost-cutting pony is cemented in the minds of the auto industry insiders. Carlos, it’s the people that make great companies! It’s also, you’re loyal customers. The majority of Nissan and Infiniti enthusiasts would rather ‘fight than switch’. Now, we’re not so sure!

Red Alert · #2 (**permalink**) 10-02-2006, 11:46 PM

Hi,
What is the source of this article? Do you recall if this information has been mentioned anywhere else?

I'm curious, because this message has major import on the future of Nissan.

Red

h00ligan · #3 (**permalink**) 10-03-2006, 12:20 AM

Quote:

Originally Posted by Red Alert

Hi,
What is the source of this article? Do you recall if this information has been mentioned anywhere else?

I'm curious, because this message has major import on the future of Nissan.

Red

howdy Red -

a mere editorial... but sure raised my eyebrows!

This editorial represents the views and thoughts of the FreshAlloy editorial staff and in no way purports to insure the 100% accuracy of the information given. We encourage our readers to comment.

http://www.freshalloy.com/site/featu...02/default.asp

ttammunek06 · #4 (**permalink**) 10-03-2006, 07:57 AM

Man that's gonna suck if it happens. Hope he doesn't turn to the darkside.

h00ligan · #5 (**permalink**) 10-03-2006, 09:13 AM

Quote:

Originally Posted by ttammunek06

Man that's gonna suck if it happens. Hope he doesn't turn to the darkside.

that's okay, seems time for a change and who's to say he's not the one that held back the titan from really even reaching a tad of its potential?

Mr.B · #6 (**permalink**) 10-03-2006, 09:22 AM

Well heck, I don't have an attention span long enough to read all of that, yet I earnestly want to know what it says ... what a pickle I'm in..... what's the chances of somebody summerizing it down to 20 words or less for me?

h00ligan · #7 (**permalink**) 10-03-2006, 09:24 AM

Quote:

Originally Posted by Mr.B

Well heck, I don't have an attention span long enough to read all of that, yet I earnestly want to know what it says ... what a pickle I'm in..... what's the chances of somebody summerizing it down to 20 words or less for me?

here you go Mr.Beezle! will the last two lines do?

And right on the heels of the Nashville move and its ramifications, YTD sales thru August are negative on every model line except Frontier, Murano, and the ‘M’. And in the month of August alone, there are minus signs next to all of them except Sentra, Maxima, and Frontier and Murano! Should we then assume there will be more cost-cutting measures put in place?

Carlos Ghosn, Ghosn, gone? We think he sees the colossal mess he and his buddy Jim Morton have caused and he wants OUT before his reputation as a 1-trick cost-cutting pony is cemented in the minds of the auto industry insiders. Carlos, it’s the people that make great companies! It’s also, you’re loyal customers. The majority of Nissan and Infiniti enthusiasts would rather ‘fight than switch’. Now, we’re not so sure!

Titan Critter · #8 (**permalink**) 10-03-2006, 03:00 PM

i'm not sure I'd go along with all that. also, you have to look at the reason why they left. california is not the most friendly state to business, especially the auto industry. I mean let's face it....why pay millions of extra dollars in taxes to a state that now is suing you and laying the destruction of the planet on your shoulders? Would you stick around? Tennessee has set itself up to be pro-business and pro-retirement. This is just the nature of capitalism.

MITitan · #9 (**permalink**) 10-03-2006, 08:57 PM

TC's got a point. Think about it.... people wanting to work and because they need work and don't have near the mortgages and overhead, can do so more effectively and actually enjoy their jobs more. This is geared more towards the factory workers.

There are many other manufacturing facilities there as well - this includes the facilities that make the parts for the cars. Think of the travel expenditure savings from not having to fly half way across the states in order to meet with a vendor to iron out some supplier issues, etc.

When launching 3 vehicles from the same brand new facility, all involved need to be sorta close - if they are, problems get solved quicker and decisions can be made based on "problems seen first hand", not described over the phone or e-mail.

h00ligan · #10 (**permalink**) 10-03-2006, 10:48 PM

did you guys actually read the editorial or just read it with a biased opinion going into it? Nissan lost some substantially important people due to this move! let me tell you, good people and good workers are HARD to replace! but if you're of the school of thought that anyone can be easily replaced, well then i can understand your viewpoint on the article.

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