Nissan plans £506m plant in China as industry giants break out of ‘traditional’ areas

By PERRY GOURLEY
Published on 15/06/2012 00:00

Nissan, already the biggest Japanese car firm in China, is understood to be planning to build a £506 million plant in the north-east of the country.

Investment in the plant, in Dalian city, will be further evidence that foreign car makers are increasingly venturing into each other’s territories after years of just operating within particular regions in the country.

A production base in Dalian would give Nissan easy access to a regional market where Volkswagen and Toyota have been making their Jetta and Corolla models for years.

The Dalian plant – jointly-owned by Nissan and its local partner, Dongfeng Motor Group – will have an initial capacity of 25,000 cars when it begins production in 2014.

China is already Nissan’s largest market even though it arrived much later than General Motors and Volkswagen. Chief executive Carlos Ghosn aims to increase Nissan sales in China to 2.3 million vehicles by 2015.

To reach that growth target, Nissan’s China venture plans to launch about 30 models during the period, including an electric vehicle under the joint-venture brand name Venucia.

In the past decade, foreign brands have carved up China into five territories but have now started encroaching on each other’s areas.

VW has been strongest in east and north China leaving the south to Japanese rivals. But the German brand is now building its first plant in the southern Guangdong province.

GM, which has been making cars for more than a decade in Shanghai, recently unveiled plans for a facility in the central city of Wuhan, a Nissan stronghold. Ford is also venturing outside its traditional south-west base to build a plant near Shanghai which has historically been GM’s patch.

PERRY GOURLEY