Ghosn Sees U.S. Market at 16.9 Million in 2006

DETROIT – While still bearish overall about the U.S. auto industry, Nissan Motor Co. Ltd. CEO Carlos Ghosn predicts sales this year will reach 16.9 million units.

“Which is stable compared to 2005,” Ghosn tells a select group of reporters during an interview at the North American International Auto Show.

For Nissan, he says the year will “be split in two parts.”

Until the launch of the all-new Sentra sedan in September, as well as the new Altima coming in the fall and refreshed versions of the Maxima sedan and Quest minivan, Nissan will have “a challenging period.”

But the auto maker, which has seen record growth in the U.S. market in the last few years, will end the year strong.

“This will be fueled by the biggest rollout of new cars we’ve ever had in the U.S. market,” Ghosn says.

Of the 28 new products slated for launch under Nissan’s Value-Up business plan, 22 remain, and Ghosn says 20 will be seen in the second half of Value-Up, which ends in March 2008.

Carlos Ghosn

He sees a tough business environment worldwide again this year, pointing to rising interest rates and increasing raw-materials costs as detrimental to growth.

“(Nissan is) still leading the industry in terms of operating margin,” he says.

Speaking of the industry, he says: “We make a product which is a very elaborate product; which is…dear to many, many people around the world; and it’s a pity that selling this product does not give car manufacturers a return… sufficient for them to produce the kind of value which is associated with a very elaborate product,”

Meanwhile, Ghosn says Nissan has made no movement on a decision to locate a vehicle assembly plant in Russia, noting Nissan is committed to “being present more intensely.”

As for another North American plant, Ghosn says Nissan has sufficient capacity at present.

If the auto maker were to increase its North American capacity, it likely would do so at its existing facilities, especially the new Canton, MS, plant, which has room for expansion, he says.

When asked whether Nissan would consider locating a plant in Michigan, as competitor Toyota Motor Corp. has discussed, Ghosn says he is not averse to any state, citing adequate working conditions and a sufficient workforce as criteria for a plant location.

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