New Nissan boss puts focus on 2 trouble spots

YOKOHAMA, Japan -- Nissan will re-spark its electric vehicle sales and Mitsubishi will play a bigger role in the U.S.

Those are two of the top orders of business for Hiroto Saikawa, the first Japanese CEO of Nissan Motor Co. in 16 years, as he steps into a role held since 2001 by the aggressive Carlos Ghosn.

Saikawa tells Automotive News in his first interview with overseas media since taking office on April 1 that he will continue building on the successes Ghosn brought to Japan's No. 2 automaker, most recently through the six-year Nissan Power 88 business plan.

"Part of the next plan is going to be steady growth built on the foundation we made in the last six years," Saikawa said last week at Nissan's global headquarters here south of Tokyo. "You can say it's a kind of remaining homework from Nissan Power 88."

But more immediately, two trouble spots need attention: Nissan's slow-selling EVs and the business of Nissan's new global partner, Mitsubishi Motors Corp.

Saikawa said that the new Leaf EV arriving in Japan this year will resolve range anxiety in consumers' minds.

He also talked up Mitsubishi's future as a much bigger player in the U.S., going so far as to compare its brand potential to that of red-hot Subaru.

In a broad-ranging discussion, the congenial, brush-cut Nissan lifer said part of his mission as Ghosn's successor also would be preparing the next generation of leaders. At 63, Saikawa almost certainly will not match Ghosn's tenure at the helm.

He expects to reveal his first blueprint for Nissan's future this summer, synchronized with the strategies of Nissan's French alliance partner, Renault SA, and those of Mitsubishi. Saikawa said it likely would be a six-year plan that mops up some unfinished objectives of the Nissan Power 88 plan, which Ghosn introduced in 2011.

Reasserting Nissan's lead in EVs will be critical, as rivals from Detroit, Germany and South Korea promise to pile into the segment with multimodel EV fleets.

Despite massive capacity investment in the U.S., Europe and Asia, Nissan is still coasting on the Leaf hatchback that it introduced in 2010. Nissan Chief Planning Officer Philippe Klein conceded in January that Nissan's EV results don't look good.

"Five or six years ago, we were looked at as a kind of adventurous company, moving into an area where nobody was expecting us to move," Klein told Automotive News. "And now you have a lot of players making big announcements, and we are looked at like laggards."

But that will change, Saikawa said, starting with the next-generation Leaf.

The overhauled Leaf will arrive by year's end, a spokesman said.

Nissan's next flagship EV will get a longer-range battery that eliminates range anxiety in Japan and major European markets, where daily driving distances are relatively short, he said. And within two years, Nissan will have a vehicle or vehicles -- he did not specify any models -- with battery upgrades that will also take range out of the equation for U.S. consumers. He also did not specify whether the improved EV offering would be the Leaf, leaving open the door for another possible EV entry.

Saikawa says that before 2020, Nissan will be able to reach a range of about 300 miles on a single battery charge. That will make Nissan EVs competitive with traditional vehicles in the U.S., he said.

"Good enough," he said of a 300-mile range. "It's a usable range, 300 miles. I believe that the technology will lead us to go there."

A 300-mile EV would top the 238-mile range of the Chevrolet Bolt EV. But it is unclear how it will stack up against such rivals as the new lower-priced Tesla Model 3 entering production this summer.

The EV segment is about to enter a new phase, Saikawa said. As carmakers overcome range anxiety with better batteries, they will no longer compete based on technology. Instead, they will appeal to emotions and brand value.

"The period of differentiating ourselves by technology is almost over," Saikawa said. "Then [it] will be a competition of how aggressively you can deploy the portfolio across the models. We would like to be on the aggressive side, the leading side."

Prices will then fall as the number of EV entries expands. The number of EV models is poised to proliferate between 2020 and 2025, he said.

"The real evolution will come when we have a serious plan for the substitution of existing powertrains, say in our major models: the Rogue, Qashqai, X-Trail. A major part of it will be EV," Saikawa said. "This is the time I'm talking about. Maybe 2025."

Nissan has gradually updated the current Leaf to deliver a range of 107 miles. The car remains the world's best-selling EV, and the Renault-Nissan Alliance is still the top EV manufacturer. But Nissan's EV reality falls far short of the goals outlined in 2012 by Ghosn, who predicted at the time that the French-Japanese alliance would sell 1.5 million EVs by 2016.

As of early January of this year, cumulative sales had reached only about 350,000 globally between the two companies. Nissan sold slightly more than 275,000 of those.

Besides the Leaf, Nissan also sells the low-volume e-NV200, an electric version of its NV200 small van. It aims to build EV momentum by launching a low-cost EV in China.

Saikawa also wants to focus on integrating Mitsubishi into the Renault-Nissan fold.

Saikawa helped Ghosn broker Nissan's purchase last year of a controlling 34 percent stake in Mitsubishi. Thanks to the addition of Mitsubishi's 934,013 vehicles, the alliance's global volume surged to 9.96 million vehicles in 2016, falling just a hair short of the industry's third-place producer, General Motors.

Nissan officials already have alluded to the more obvious areas of likely Nissan-Mitsubishi cooperation. The two have common interests in minicars, EVs and Southeast Asia.

But the U.S. remains a big potential for both brands. Indeed, it was the single biggest market for both brands in 2016. Nissan sold a whopping 1.5 million vehicles there in 2016 for an 8.9 percent market share, while Mitsubishi moved a meager 96,267 vehicles for just 0.5 percent of overall volume.

Saikawa made clear that Nissan has a big stake in seeing Mitsubishi boost its U.S. presence. Higher U.S. sales for Mitsubishi will translate into bigger scale for the entire alliance, Saikawa said.

"They are now a 1 million [unit] company," Saikawa said of Mitsubishi's global sales.

"Easily they can grow to 1.5 million, hopefully 2 million. Having a partner [that is] a 2 million company is much better than having [one that is] a 1 million company.

"My first wish is that they should start growing, rapidly, and they should regain ground in the U.S. as soon as possible."

Mitsubishi notched record global sales of 1.53 million units in the fiscal year ended March 31, 2004.

Nissan can help Mitsubishi by sharing platforms and engineering, he said. Nissan has already dispatched a slew of top executives to Mitsubishi to run everything from r&d to product planning there.

The new Mitsubishi roster is a who's who of former Nissan brass. Trevor Mann, Nissan's former chief performance officer, is now Mitsubishi's COO. Former Datsun brand chief Vincent Cobee now leads Mitsubishi's product planning, and former Nissan r&d boss Mitsuhiko Yamashita runs r&d at Mitsubishi.

Nissan doesn't plan to offer Nissan vehicles to Mitsubishi to rebadge and sell as its own in North America. Nissan's experience with Renault shows that does not work if both brands are competing in the same market, Saikawa said. But Renault might consider supplying cars to Mitsubishi for sale in the U.S. because Renault is not a player there.

"It is an opportunity," Saikawa said of cooperating with Renault.

Nissan dealers in the U.S. can also take on Mitsubishi franchises when appropriate, he added.

Saikawa was upbeat about Mitsubishi's potential in the U.S., saying its four-wheel-drive heritage dovetails perfectly with the crossover boom sweeping the market.

He likened Mitsubishi's brand attributes to those of Subaru, adding, "I believe they have a very strong future in the U.S. market."