BIRMINGHAM, Ala. -- Nissan North America Inc. has set new manufacturing targets for costs and quality.
The "20/20 program" wants a 20 percent reduction in manufacturing costs over the next three years and a 20 percent annual improvement in Nissan's quality showings.
Dan Gaudette, senior vice president of North American manufacturing and quality assurance, says the quality targets will use a variety of measurements, including internal indicators and Initial Quality Study reports from J.D. Power and Associates.
Nissan's last major cost-cutting drive at the beginning of this decade focused on suppliers. The automaker developed wide-ranging plans with suppliers to cut their costs by 20 percent over three years through 2003.
But Gaudette emphasized that Nissan is focusing on internal issues this time.
"This isn't about our suppliers. It's about us," Gaudette said last week at the Automotive News Manufacturing Conference. "We are looking for ways to reduce our waste, reduce our scrap, work more efficiently at our plants."
He said the cost effort also will look at nonmanufacturing areas inside the company, including engineering overhead and human resource.
But Gaudette said Nissan will share cost-cutting ideas with suppliers that are located on its property. At both Canton, Miss., and Smyrna, Tenn., Nissan has some suppliers either inside its assembly plants or operating in adjacent buildings.
"Those suppliers are really acting as an extension of us," he said, "so it makes sense for us to look at ideas on waste-elimination together."
Gaudette said Nissan is intent on improving its profitability. He said the company has new operating goals aimed at achieving a 20 percent return on its investments, including its factories.
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