TOKYO - Flush with its best profits in a decade, Nissan Motor Co. Ltd. is going on a capital spending spree that few could have imagined just one year ago.
In the works: a new truck factory in the United States, expected to be announced this week; a nearly $1 billion fuel cell research project with parent Renault SA; and hundreds of new engineers it needs for its aggressive new-model plans.
'Nissan is back. This is a new company that's being created in front of you,' Nissan President Carlos Ghosn said at a press briefing here last week. 'We will have the means and the resources - maybe for the first time in many years - to invest in our future.'
In a decisive bounce back from a $6.5 billion loss in its last fiscal year, Nissan is expected to announce plans this week to build a $1 billion greenfield assembly plant, probably in Mississippi.
'Because of our decision to launch a full-sized pickup truck and SUV in fiscal year '03, as well as our plan for the next generation minivan, we will have to build those products in the United States,' Ghosn said.
But the new plant is not the only big-ticket item planned by the formerly cash-strapped Nissan.
The automaker already had announced plans to spend $1 billion to triple its V-6 and V-8 engine capacity in Decherd, Ala., and to raise capacity at its Smyrna, Tenn., plant to 500,000 units a year from 380,000.
Nissan and Renault also are launching a five-year, fuel cell development program, spending a combined $790 million and mobilizing 300 engineers and technicians. Renault owns a controlling 36.8 percent of Nissan.
In addition, Nissan is hiring 1,000 engineers, double the number Ghosn said the company would hire when he announced the restructuring plan in October 1999, to support its product push.
Nissan plans to launch 22 vehicles in the next three years: 15 in Japan, 12 in North America and 12 in Europe.
The North America-bound models include a new sedan in September 2001 and a new Infiniti Q45 in April 2001.
Nissan earlier said it would raise its capital-spending guideline to 5 percent of sales, from 3.5 percent. For the current fiscal year, it raised its capital spending forecast to $2.87 billion from the $2.78 billion it had forecast in May.
To be sure, Nissan is not easing off on its plans to cut costs, sell assets and dismantle its keiretsu network of suppliers.
But Ghosn said the company would not tighten the screws further on its suppliers, even though it achieved more cuts than expected - 10 percent rather than 8 percent - in the six months to Sept. 30.
Instead, Nissan will stick to its goal of cutting parts costs by 20 percent in three years, he said.
Nissan raised its full-year goals on several fronts.
It doubled its forecast for operating profit to $2.04 billion and more than quadrupled its forecast for net profit, to $2.31 billion from $370.4 million before.
Most of Nissan's operating-profit increase came on lower purchasing costs, although the savings were eroded in part by a stronger yen against the dollar and euro, which brought fewer yen profits for every vehicle sold overseas.
'This is a fantastic showing from Nissan,' said William Nestuk, an auto analyst at WestLB Securities Pacific in Tokyo. 'It's amazing what you can do with cost-cutting.'