YOKOHAMA - Nissan Motor Co. Ltd., Japan's third-largest automaker, said on Tuesday it would carefully monitor inventories to limit the impact from any downturn in demand due to the U.S.-led war in Iraq.
Speaking at the opening of an engine museum and guest hall at its Yokohama plant, Nissan Chief Executive Carlos Ghosn said he wanted to see how the war will impact the total automobile market, especially North America.
"For the moment, the contingency plans are mainly related to logistics in terms of how to better supply the existing markets," Ghosn told reporters. "We are obviously watching very carefully the levels of inventories in all the markets."
Last week, investment bank Goldman Sachs downgraded the outlook for Japan's auto sector due to signs that the U.S. economy would slow even if a war in Iraq were short-lived, while demand also would weaken in Europe and Japan.
There are also concerns that a war could disrupt effective supply chain management at automakers, which is key to holding down costs as demand weakens.
Nissan's Ghosn, surrounded by reporters in front of a 1935 Datsun Roadster produced at its Yokohama factory, said the company must be flexible in management to adjust to a changing and tough environment.
The Nissan chief said the war would not delay this year's opening of its Mississippi assembly plant, which is expected to produce a full-size pickup, two SUVs, a minivan and a sedan.
"The plant in Mississippi would start production on time," Ghosn said. "Whatever happens in the environment, it will not have an impact on the schedule of the launch of the different products and the ramp up of the plant in Mississippi."