UPDATE 1-Nissan bets on Datsun heritage brand for sales push

Wed Mar 21, 2012 6:02am EDT

* Datsun to start in India, Indonesia, Russia from 2014

* Two models to be offered within 1 year in each market

* Datsun revived for first time in 3 decades

* Datsuns to be tailor-made for each market

* Succeeding in new brand no small feat - analyst

By Chang-Ran Kim

YOKOHAMA, Japan, March 21 (Reuters) - Nissan Motor Co is counting on its heritage Datsun brand to attract a vast pool of first-time car buyers in emerging markets as it aims to grab an 8 percent share of the global market by 2016, executives said on Wednesday.

Japan's No.2 automaker announced a day earlier the revival of the 80-year-old Datsun nameplate for entry-level cars starting in India, Indonesia and Russia from 2014, after it was ditched in 1981 to consolidate all cars under the Nissan brand.

"Datsun is a good name," Chief Executive Carlos Ghosn told reporters at Nissan's global headquarters in Yokohama on Wednesday. "Datsun was known for a product that was robust, reliable and affordable. These are good attributes to start with, (and) we're going to add good quality and modernity."

For Nissan, selling cheaper cars under an independent brand removes the risk of hurting its core brand - a conundrum that rivals such as Toyota Motor Corp and Honda Motor Co faced as they push the limits of low-cost offerings in India and other markets.

But analysts said building a successful brand was no small feat, requiring years of dedication, allocation of sufficient resources and the right products.

"I'm not convinced," UBS auto analyst Tatsuo Yoshida said. "They haven't even achieved a solid brand identity for Nissan yet. It's going to be a bumpy road."

Ghosn said Datsun would eventually expand to other high-growth markets and become a global brand that offered products tailor-made to the regulations and consumer needs for each market.

In Indonesia, that would mean vehicles with engines smaller than 1.2 litres and priced under $10,000 to meet the government's requirements under its new green car programme, for instance.

In India, Datsun's target price would be below 400,000 rupees ($8,000), where the bulk of demand lies, Ghosn said, possibly, but not limited to an ultra-low-cost car being developed in a joint project with Renault SA and Bajaj Auto Ltd.

Through the launch of two models in the first year and an enhanced line-up within three years in each of the initial markets, Datsun will account for one-third to half of Nissan's sales in India, Indonesia and Russia by the business year ending in March 2017, the company said.

"We want no more segments of the market where there is no offering from our company, particularly in the high-growth markets," Ghosn said. "This is part of our strategy to take leadership in the emerging markets."

Under its "Power 88" business plan through March, 2017, Nissan is targeting a global market share of 8.0 percent, up from 5.8 percent in the 2010/11 business year.

Corporate Vice President Vincent Cobee, head of the Datsun business unit, said the brand aimed to appeal to a growing population of young, up-and-coming customers looking for something new, whether it be types of sales financing or vehicle accessories offered.

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.