YOKOHAMA, Japan -- When Nissan CEO Carlos Ghosn unleashed an avalanche of ambitious numerical targets for his latest midterm business plan this week, he was the first to concede: “Some may question whether we can achieve all of it.”
But a better question is whether Ghosn needs to achieve all of it. Ghosn’s track record of meeting his business plan targets is patchy, going back to the Value Up plan that ended in 2008.
Yet he delivers results and keeps his job. Shareholders at their annual meeting on Wednesday here surely will give him another two-year mandate as CEO.
With Value Up, Ghosn missed a key goal of hitting 4.2 million unit sales and of delivering a 20 percent return on invested capital. For his next business plan, dubbed GT 2012, he shied away from bold numerical targets in lieu of seeking steady 5 percent revenue growth.
And Nissan soon abandoned that plan too.
Granted, that was because the global financial crisis blew the bottom out of the industry.
But there were still several GT 2012 goals that could have been separated from sales growth. Namely, Nissan’s ballyhooed Quality Leadership initiative, which strove to shore up sagging quality marks. Or Ghosn’s aim to halve the use of precious metal per vehicle.
What happened to those targets?
Meanwhile, under GT 2012, Nissan wanted to cover 94 percent of global segments by the fiscal year ending March 31, 2013. Now, in the new business plan called Power 88, Ghosn wants to cover 92 percent of the segments by the fiscal year ending March 31, 2017. Huh?
And Ghosn already is hedging on Power 88’s centerpiece goal to take 8 percent of the global auto market: “Maybe we will get to 7.8 or 7.7; it doesn’t mean we failed. It’s just a guide.”
Ghosn may not reach all his goals. But does anyone really care?
He guided Nissan relatively unscathed through the financial crisis and this year’s Japan earthquake. Nissan predicts much smaller hits to its profit than its top two rivals, Toyota and Honda.
And as Ghosn notes, his chances for meeting targets have never been better. Since taking the helm of a struggling Nissan in 1999, the company has never been on sounder footing.
“This is the first plan we are starting without any handicaps,” Ghosn said. “This is the first time Nissan is starting a plan on the offensive.”
So outsiders might forgive him a little razzmatazz.
Besides, stretching out six years, Power 88 is Nissan’s longest midterm plan yet. It offers lots of wiggle room for the bold proclamations of 2011 to be forgotten or fudged in the march of time.