It was reported earlier in July that Nissan is considering pulling the plugs off its low-cost Datsun brand. Now according to Reuters, as part of Nissan’s crisis recovery plan, the Japanese automaker is likely to axe the Datsun brand, in addition to dropping some unprofitable products and close a number of assembly lines worldwide as it seeks to boost profits by shrinking its size & operations.
Related: Is Datsun Brand Doomed to be Axed?
Known internally as the “performance recovery plan”, the proposed steps mark a sharp break with Nissan’s strategy under ousted leader Carlos Ghosn, who pursued ambitious vehicle sales targets in emerging as well as major markets. According to a source:
“We’re trying to clean up what had happened in the past. Under Ghosn, Nissan sought to meet sales objectives at any cost, including “practically giving away cars” to fleet customers.”
Nissan re-launched the Datsun brand in 2013 primarily to cater to markets including India, Russia, South Africa and Indonesia. However Datsun brand failed to create any noteworthy impact in any of its targeted markets and as the company admits, it has fallen woefully short of expectations.
Struggling with plunging sales in several important markets, Nissan also recently announced to cut 12,500 employees from around the world which is nearly 9% of its global workforce. Nissan will also cut down 10% of its global product portfolio to improve its competitiveness on a global scale.
Earlier this month, Ghandhara Nissan Ltd (GNL) said it is reviewing its plans to assemble Datsun vehicles in Pakistan as the company feels that under the prevalent volatile economic conditions and exchange rates, it cannot afford to go for a project of this magnitude especially with that level of uncertainty.
However if we look, the company was never in position to launch these cars in Pakistan. As analyzed by us earlier, with parent Nissan battling with troubles and taking extreme cost-cutting measures, there were always dark shadows over Datsun brand which is now going to be axed to help Nissan get back on its feet.
From the looks of it, both Datsun and Renault (which are part of the same alliance) will just fade into the dark even before making an appearance in Pakistan.