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Wachovia Lecture Series

Nissan CEO Visits Campus

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Carlos Ghosn Lends Insights into His Company’s Remarkable Five-Year Turnaround

Carlos Ghosn, CEO, Nissan

Carlos Ghosn, president and CEO of Nissan Motor Co., Ltd., who has overseen a remarkable turnaround at the international automaker since he joined in 1999, described his strategies for success to a capacity audience of Moore School students and faculty in the Russell House Theater on the Columbia campus January 31. Ghosn was the final speaker in the Moore School’s Wachovia Lecture Series, sponsored by Wachovia Bank.

When Ghosn took over at Nissan, the company was in peril. Its market position in Japan had been in decline for 27 years, it had only been profitable one in the previous eight years, and its operating profit margin stood at just 1.4 percent. Ghosn’s strategy at Nissan involved implementing a series of 3-year-plans to dramatically turn around production and profits.

First was the Nissan Revival Plan, with the goals to return to profitability immediately in 2000, to reach an operating margin higher than 4.5 percent, and to cut net automotive debt in half by fiscal year 2002. The company succeeded. Next came the NISSAN 180 plan with its goals to achieve one million additional vehicle sales by the end of fiscal year 2004, to increase the operating profit margin to 8 percent, and to reduce the net automotive debt to zero. The company has reached the latter two goals and is closing in on the first. In April, the company will begin to implement a third plan, NISSAN Value-Up.

Ghosn answers questions from students in Russell House auditorium.

Ghosn told students not to shy away from the bigger challenges, and that sometimes, executives have to make the tough decisions. Among his early moves at Nissan, Ghosn closed five plants and cut the workforce by 21,000. The auto workers’ labor union supported him, however, as long as he could show results. Indeed, he did. Nissan’s operating profit margin today stands at 10.1 percent, at the top among global automakers. And, the workforce is up to 139,000, an increase of 19,000.

Ghosn’s own next big challenge lies just ahead. In April, he will assume the role of CEO of Renault, the French automaker, in addition to leading Nissan, and will try to lead both companies simultaneously to greater market innovation and profitability.

Ghosn addresses the business community during the luncheon at the Columbia Metropolitan Convention Center.

The visit marked a return to South Carolina for the auto executive who served as chairman and chief executive officer at Michelin North America in Greenville, South Carolina, in the 1990s. Ghosn recalled his time in South Carolina when he later spoke to a large audience of dignitaries and businesspeople at a luncheon held at the Columbia Metropolitan Convention Center. Among those in attendance were former S.C. governor and U.S. Secretary of Education Richard Riley, who introduced Ghosn, former U.S. senator Ernest Hollings, Gov. Mark Sanford, former governor Jim Hodges, U.S. Representative Henry Brown, and former secretaries of commerce Charles Way and Bob Royall, who is current U.S. ambassador to Tanzania. Also in attendance were USC President Andrew Sorensen and USC vice president for research Harris Pastides. A number of Nissan executives from around the Southeast were in attendance as well as executives from Wachovia Bank.

Ghosn was born in Brazil and educated in France. He served with Michelin for 18 years, and then became executive vice president of the Renault Group in 1996 before joining Nissan.

Gail Crouch