supplierbusiness supplying the renault-nissan alliance · automotive supplierbusiness | supplying...

SupplierBusiness

Supplying the Renault-Nissan Alliance

2014 edition supplierbusiness.com

Supplying the OEMs

IHS Automotive

SAMPLE

2014 edition 2 © 2014 IHS

IHS Automotive SupplierBusiness | Supplying the Renault-Nissan Alliance

COPYRIGHT NOTICE AND LEGAL DISCLAIMER© 2014 IHS. No portion of this report may be reproduced, reused, or otherwise distributed in any form without prior written consent, with the exception of any internal client distribution as may be permitted in the license agreement between client and IHS. Content reproduced or redistributed with IHS permission must display IHS legal notices and attributions of authorship. The information contained herein is from sources considered reliable but its accuracy and completeness are not warranted, nor are the opinions and analyses which are based upon it, and to the extent permitted by law, IHS shall not be liable for any errors or omissions or any loss, damage or expense incurred by reliance on information or any statement contained herein. For more information, please contact IHS at [email protected], +1 800 IHS CARE (from North American locations), or +44 (0) 1344 328 300 (from outside North America). All products, company names or other marks appearing in this publication are the trademarks and property of IHS or their respective owners.

IHS AutomotiveSupplierBusiness

ContentsOverview .......................................................................................................................................................................... 6

Global market overview .............................................................................................................................................. 6Financial data ............................................................................................................................................................... 6Renault-Nissan alliance financial overview .............................................................................................................. 7

Product and platform strategy ...................................................................................................................................... 9Company background and strategy review ............................................................................................................. 9Major model programmes ....................................................................................................................................... 10

1. Renault Clio ............................................................................................................................................................ 102. Nissan Sylphy ......................................................................................................................................................... 133. Nissan Qashqai ...................................................................................................................................................... 144. Nissan Tiida............................................................................................................................................................ 165. Nissan Note ............................................................................................................................................................176. Nissan Altima ......................................................................................................................................................... 187. Renault/Dacia Duster .............................................................................................................................................. 198. Nissan Juke ........................................................................................................................................................... 209. Nissan March ......................................................................................................................................................... 2110. Renault Megane ................................................................................................................................................... 23

Platform strategy ....................................................................................................................................................... 24Major platforms ......................................................................................................................................................... 26

1. B (inc. Renault Clio, Nissan Juke, and Nissan LEAF and Renault Zoe EVs) ............................................................. 262. C (inc. Nissan Qashqai, Rogue, Renault Megane, and Scenic) ............................................................................... 273. B0 (inc. Renault/Dacia Logan, Sandero, Duster, Dokker, and Lada Largus) ............................................................ 284. D (inc. Renault Laguna, Nissan Altima and Murano, and Samsung SM5) ............................................................... 295. V (inc. Nissan March, Note, Renault Pulse, and Datsun Go) ................................................................................... 306. X61B (inc. Nissan Frontier, Navara, and Pathfinder)................................................................................................. 317. X65 (inc. Renault Clio, Kangoo, and Twingo) ........................................................................................................... 318. FR-L (inc. Nissan Skyline, Fairlady Z/370Z, Infiniti FX, and Q50) ............................................................................. 31

Component sharing ................................................................................................................................................... 32Volume planning ........................................................................................................................................................ 33

Production strategy ...................................................................................................................................................... 35Production strategy overview .................................................................................................................................. 35Manufacturing network............................................................................................................................................. 35

France ........................................................................................................................................................................ 37Japan ......................................................................................................................................................................... 39China ......................................................................................................................................................................... 41Mexico and United States .......................................................................................................................................... 42United Kingdom ......................................................................................................................................................... 44Russia ........................................................................................................................................................................ 44India ........................................................................................................................................................................... 46Brazil .......................................................................................................................................................................... 47Turkey ........................................................................................................................................................................ 48

SAMPLE



Morocco .................................................................................................................................................................... 48South Korea ............................................................................................................................................................... 49

Internal supply network ............................................................................................................................................ 49Modularisation strategy ............................................................................................................................................ 50Supplier parks ............................................................................................................................................................ 51

Cluster of reference .................................................................................................................................................... 52Strategies for manufacturing efficiency ...................................................................................................................... 53

Purchasing strategy ..................................................................................................................................................... 55Purchasing strategy overview .................................................................................................................................. 55Levels of vertical integration and outsourcing ...................................................................................................... 56Purchasing organisation ........................................................................................................................................... 57Purchasing offices ..................................................................................................................................................... 59

Key purchasing personnel .......................................................................................................................................... 59Purchasing budget .................................................................................................................................................... 60

Supplier selection ......................................................................................................................................................... 61Supply base development ........................................................................................................................................ 61Major and strategic suppliers .................................................................................................................................. 61Supplier selection criteria ........................................................................................................................................ 63Working with the Renault-Nissan alliance.............................................................................................................. 64

Global sourcing ............................................................................................................................................................. 65Policy and plans ......................................................................................................................................................... 65

EMEA ......................................................................................................................................................................... 67NAFTA ....................................................................................................................................................................... 67LATAM ....................................................................................................................................................................... 68APAC ......................................................................................................................................................................... 68

Pricing policy ................................................................................................................................................................. 69Cost-reduction programmes and strategies ......................................................................................................... 69Payment terms ........................................................................................................................................................... 70Raw-material price management ............................................................................................................................ 70

Quality management .................................................................................................................................................... 71Quality level ............................................................................................................................................................... 71Quality management systems .................................................................................................................................. 72Integration into product development .................................................................................................................... 72Management of sub-suppliers ................................................................................................................................. 73Supplier awards ......................................................................................................................................................... 74

Technology .................................................................................................................................................................... 76Technological positioning ......................................................................................................................................... 76Areas of focus ............................................................................................................................................................ 76R&D spending............................................................................................................................................................. 77R&D organisation ....................................................................................................................................................... 77Access to supplier technology ................................................................................................................................. 78Approach to alternative fuels, electrification, and fuel cells ............................................................................... 79Special vehicle development .................................................................................................................................... 80

Interviews ...................................................................................................................................................................... 82Christian Vandenhende, senior vice-president, Purchasing, and chairman of the Renault Nissan Purchasing Organization .......................................................................................................................................... 82John Whitfield, senior executive manager for on-site manufacturing and John Barnett, operations director

SAMPLE



CK North-East ............................................................................................................................................................ 87

OEM-Supplier survey results ...................................................................................................................................... 94Introduction to the SuRe Index ................................................................................................................................ 94Methodology .............................................................................................................................................................. 94Executive summary ................................................................................................................................................... 94Profit potential ........................................................................................................................................................... 96

OEM level ................................................................................................................................................................... 97Organization ............................................................................................................................................................... 97

OEM level ................................................................................................................................................................... 98Trust ............................................................................................................................................................................. 98

OEM level ................................................................................................................................................................... 99Pursuit of excellence ................................................................................................................................................. 99

OEM level ................................................................................................................................................................. 100Outlook ...................................................................................................................................................................... 100

OEM LEVEL ..............................................................................................................................................................101

SWOT analysis ............................................................................................................................................................. 102

Global footprint .......................................................................................................................................................... 103

Forward model programme ....................................................................................................................................... 105

Major suppliers to Renault/Nissan ........................................................................................................................... 107

FiguresFigure 1: Global light vehicle sales, 2007–2013 ........................................................................................................... 6Figure 2: Structure of the Renault-Nissan Alliance .................................................................................................. 10Figure 3: The Renault Clio Mercosur, introduced in 2012, is a second-generation car with fourth-generation styling updates .............................................................................................................................................................. 11Figure 4: The Renault Clio V6 from 1999 .................................................................................................................... 12Figure 5: The fourth-gen Renault Clio was introduced in 2012 ............................................................................... 13Figure 6: The all-new, second-generation Nissan Qashqai went on sale in Europe in January 2014 ................ 15Figure 7: The North American version of the Nissan Tiida was facelifted in 2010 ............................................... 16Figure 8: The chassis of the latest Nissan Altima is built using an increased proportion of high-strength steel 18Figure 9: The world premiere of the Nissan Juke in February 2010 ....................................................................... 21Figure 10: The Nissan Figaro was based on the March mini car ............................................................................ 22Figure 11: Unveiled in 2013, The Twin’Z concept is described as offering a preview of the next Renault Twingo 25Figure 12: The B-platform in the Renault Zoe EV has been reworked to accommodate the battery pack ....... 26Figure 13: The Lada Largus is based on the RF90 version of the B0 platform used in production of the Renault and Dacia Logan MCV (Maximum Capacity Vehicle) estate ..................................................................... 28Figure 14: Indonesia will be the test market for the Datsun Go+, which offers a third row of seating .............. 30Figure 15: Diagram outlining the basic elements of the CMF module system...................................................... 32Figure 16: Renault Powertrain global engine and transmission production sites ............................................... 39Figure 17: Nissan Almera on the B0 line, Togliatti plant, Russia ............................................................................. 45Figure 18: Renault Production System: Four functions of product manufacture ................................................. 54Figure 19: Structure of Renault-Nissan B.V. .............................................................................................................. 58Figure 20: Christian Vandenhende (left) and Igor Komarov, president of AvtoVAZ, at the signing of the Common Purchasing Organization agreement in 2013 ........................................................................................... 59

SAMPLE



Figure 21: Rebecca Vest, Nissan North America ...................................................................................................... 60Figure 22: Supplier Selection and Performance Review ......................................................................................... 64Figure 23: RNPO Core Processes ............................................................................................................................... 65Figure 24: RNPO Supplier selection flow chart ........................................................................................................ 66Figure 25: Role of Purchasing departments at Renault-Nissan alliance ............................................................... 67Figure 26: Renault launched the Twizy in 2011 ......................................................................................................... 77Figure 27: Calsonic Kansei water cooling plate for EV and HEV battery packs ................................................... 79Figure 28: Unveiled in 2010, it is still unknown whether the DeZir concept will result in a production model . 80Figure 29: Christian Vandenhende, Renault-Nissan alliance .................................................................................. 82Figure 30: SuRe Index 2013 - Top of the Ranking ..................................................................................................... 95Figure 31: SuRe Index 2013 - Middle of the Ranking ................................................................................................ 95Figure 32: 2012–2013 Profit potential results on scale ............................................................................................. 96Figure 33: 2012–2013 Organisation results on scale ................................................................................................ 97Figure 34: 2012–2013 Trust results on scale .............................................................................................................. 98Figure 35: 2012–2013 Pursuit of excellence results on scale .................................................................................. 99Figure 36: 2012–2013 Outlook results on scale ....................................................................................................... 100Figure 37: Renault Nissan - Global assembly plant locations ............................................................................... 103Figure 38: Renault Nissan - European assembly plant locations ......................................................................... 103Figure 39: The Nissan Taxi will be launched in 2014, with an EV version to follow in 2015 ............................... 105Figure 40: Global Renault-Nissan Light Vehicle Sales Forecast (by Brand/Global Nameplate) ....................... 106Figure 41: Major suppliers to Renault/Nissan ......................................................................................................... 107

TablesTable 1: Key Renault financial performance values .................................................................................................... 6Table 2: Key Nissan financial performance values ..................................................................................................... 7Table 3: Renault-Nissan Top 10 best-selling models (by Global Nameplate) 2009, 2013, 2018 ........................... 10Table 4: Ranking of key models in United States mid-size segment (2009, 2013, 2018) ...................................... 19Table 5: Global sales for Renault and Dacia Duster, 2009 - 2025 (inc. forecast) .................................................. 20Table 6: Global sales for Megane, Focus and Golf (various years, 2000 - 2025 .................................................... 24Table 7: Forecast vehicle output (by platform) at Renault-Nissan Oragadam (Chennai) plant 2013-2020 ........ 24Table 8: Renault-Nissan alliance platform usage (by manufactured volumes) 2009, 2013 and 2020 ................. 26Table 9: Comparison of European sales for Ford Mondeo, Opel Insignia, Renault Laguna (2008-2020) .......... 29Table 10: Total global production Renault-Nissan alliance (by brand and group) 2000–2020 ............................ 33Table 11: Renault-Nissan global production plants with forecast 2013 volumes (by brand) ............................... 35Table 12: Top Global EV manufacturers (by volumes) 2013-2020 ........................................................................... 37Table 13: Top 20 OEMs in China (by sales) 2013 ........................................................................................................ 42Table 14: Annual local sourcing opportunity in the United Kingdom by component area (in GBP million)...... 56Table 15: SWOT Analysis - Renault Nissan alliance ............................................................................................... 102Table 16: Renault/Nissan plant locations with production forecast for 2013 ..................................................... 103SAMPLE



Product and platform strategyCompany background and strategy reviewThe Renault-Nissan alliance was formed in March 1999, with the French carmaker initially assuming control of approximately 36% of its Japanese counterpart for USD5.4 billion. Before this deal, Nissan had already been in talks with a series of possible partners, including then-DaimlerChrysler and Ford Motor, but these companies had walked away from buyout negotiations after uncovering such lowlights as a USD20-billion debt pile (serviced with an annual USD1 billion in interest payments), massive excess capacity in the home market, and a loss of market share that had seen the carmaker slip to third behind Toyota and Honda in the sales rankings of Japanese OEMs.

While Nissan had big problems that had played a large part in the OEM returning losses over six of the previous seven years before the final alliance deal, Renault itself was far from being the ideal partner. The failed 1993 merger between Renault and Volvo had left both companies with heavy debt burdens, while a failure to invest outside the region had made the OEM overly dependent on its Euro-centric footprint, which at that point delivered 85% of all vehicle sales. At the same time market competition was getting tougher, with the newly resurgent Volkswagen and recovering Fiat looking to push the French brand aside. From the outside looking in, the tie-up between Renault and Nissan was not viewed so much as a potential threat, but the blind leading the blind into business irrelevance.

The partnership went on to create synergies across all areas of business, but at the turn of the century none was more important than gaining direct access to respective markets. With the opportunity for Renault to expand into Asian and North American markets, and Nissan having access to markets in Europe and Latin America (including Central and South America), there was solid potential for market expansion. But before that, Nissan had to be brought back from the brink and that job fell to Carlos Ghosn, who, after having already turned around Renault though implementation of USD3.6 billion-a-year programme of spending cuts and the closure of the plant in Vilvoorde, Belgium, had already been dubbed “le cost killer”.

Central to the plan formulated by Ghosn was cutting purchasing costs by 20% over three years, largely through a programme of centralisation. This would effectively break the “kieretsu” group of companies that had been the preferred suppliers to Nissan. Another step would see local (Japanese) capacity of 2.4 million units (equating to an average 53% plant utilisation) slashed by 30% by closing three of the seven vehicle assembly plants and two of the engine and transmission production facilities.

In addition to these changes across manufacturing, Ghosn addressed cross-company and cross-culture communication issues by insisting English was the default alliance language, while also overhauling the executive structure and selling off Nissan stakes in non-core companies. These and other changes ultimately delivered what is widely considered one of the most remarkable turnarounds in recent corporate history. Within a year Nissan was back in profit and the carmaker has largely remained in the black since then. Sales surged and the carmaker reclaimed second position in total Japanese sales from Honda, while moving to expand operations outside the home market. Both partners continue to benefit from the alliance, with the two companies reporting in June 2013 that they achieved record internal synergies of EUR2.69 billion, a year-on-year improvement of 54% (EUR1.75 billion). The areas posting the biggest gains were purchasing (EUR851 million, through the Renault-Nissan Purchasing Organization), powertrain (EUR709 million), and vehicle engineering (EUR546 million), with yet further gains likely to be realised in non-engineering areas (totals are non-cumulative and only reflect synergies realised that year).

According to the alliance, synergies are increasingly being found in emerging markets, where both companies are expanding their respective footprints. At the facility in Chennai, India, the Renault-Nissan alliance operates its largest platform-sharing project, which after the latest expansion is complete will deliver approximately 400,000 units per year for export and the local market.

“Synergies and greater economies of scale allow Renault and Nissan to compete in an elite tier of the world’s top automakers globally,” said Christian Mardrus, Renault-Nissan alliance managing director for logistics and the office of CEO. “We expect to generate even more synergies going forward, particularly in emerging markets such as Brazil, Russia, India and China.”

SAMPLE

2014 edition 10 © 2014 IHS


This, then, appears to be the way forward for the alliance, where any talk of Renault taking over Nissan is brushed aside – were they to become one, the company would currently rank as the fourth-largest global OEM. As it stands, the French company currently controls a 43.4% stake in Nissan, with the Japanese carmaker holds 15.0% of Renault. The common management structure is operated under Renault-Nissan BV, in which both OEMs hold an equal share. Founded in March 2002, this closed limited liability company is incorporated under Dutch law. Beyond that, since 2010 each has held a small stake in Daimler (reciprocated by the German premium vehicle manufacturer), which of the various OEMs working with the alliance, currently has the largest single interest in each of the partner companies.

Figure 2: Structure of the Renault-Nissan Alliance

Source: Renault-Nissan

Major model programmes Table 3: Renault-Nissan Top 10 best-selling models (by Global Nameplate) 2009, 2013, 2018Sales Brand Global

Nameplate2009 Sales Brand Global

Nameplate2013 Sales Brand Global

Nameplate2018

Renault Clio 446,738 Renault Clio 485,677 Nissan Sylphy 462,106

Nissan Tiida 419,089 Nissan Sylphy 389,740 Renault Clio 394,541

Renault Megane 304,990 Nissan Qashqai 372,559 Nissan Note 388,329

Nissan Note 272,547 Nissan Tiida 366,426 Nissan Tiida 377,638

Nissan Qashqai 250,388 Nissan Note 358,375 Nissan Altima 351,246

Nissan Altima 207,321 Nissan Altima 344,835 Nissan March 334,573

Renault Twingo 187,880 Renault Duster 230,500 Nissan Qashqai 311,905

Renault Scenic 159,293 Nissan Juke 225,320 Renault Megane 261,523

Renault Logan 149,960 Nissan March 213,077 Renault Sandero 247,372

Dacia Sandero 149,186 Renault Megane 192,801 Nissan Juke 204,481Source: IHS Automotive

1. Renault ClioSince the Renault-Nissan alliance was formed in 1999, the best-selling model across both OEMs has been the Renault Clio. To date, it remains one of only two models, together with the Volkswagen Golf, to have twice won the European Car of the Year award. According to IHS Automotive figures, the B-segment Clio topped sales tables for the 11 years covering 2000 and 2010 and, after being unceremoniously pushed aside by the highly successful Nissan Tiida over 2011 and 2012 (for more on the Tiida, please see next sub-section), the forecast for 2013 puts the French car back in the top sales spot.

The first Clio was launched in 1990. Following on from the Renault 5 (in segment, rather than design or quality), the front-

REDACTED

Data only available in full reportSAMPLE

2014 edition 11 © 2014 IHS


wheel-drive model was first introduced as a three- and five-door hatchback, although saloon and estate models were later added to the range. The model was offered with a range of economical engines, including 1.2- and 1.4-litre four-cylinder “Energy” models, which originally used carburettors but later switched to electronic fuel injection to help meet stricter emissions standards. This first Clio was facelifted in 1994, with only minor changes to engines and exterior trim, but a second facelift in 1996 saw the model offered with a series of engines shared with other Renault models, including the 1.1-litre eight-valve DIET engine from the Twingo city car. Exterior changes included new front and rear light clusters, including a third brake light.

The Clio II was introduced in 1998 and featured more rounded styling than the first car. Further changes included the incorporation of lightweight materials, including plastic front wings (fenders). By 2000, the first 1.6-litre 16v engine had been added to the range and over later years, the four-valves-per-cylinder setup became the petrol engine of choice across the range. The 2001 facelift replaced the rounded headlights with partially sweptback units, while new engines included the K9K 1.5-litre dCi (direct common rail injection) turbodiesel and the 1.2 16v petrol version, both of which were engineered in conjunction with Nissan. In Europe the Clio II was replaced by the third-generation model in 2005, but the second-generation car remains on sale in various markets around the world, sold alongside the related Renault Logan, Sandero, and Duster models.

Figure 3: The Renault Clio Mercosur, introduced in 2012, is a second-generation car with fourth-generation styling up-dates

The third-generation Clio was considerably larger than the out-going model, with the wheelbase growing from 2,472mm to 2,575mm – only 3mm shorter than the VW Golf, which was positioned in the segment above the Clio. The model further grew in every other external dimension – overall length reached 3,986mm – and the related weight increase of 150kg effectively marked a switch in emphasis from a driver-oriented car to one that delivered the ride comfort and maximised interior space favoured in markets outside Europe. Luggage space was retained by carrying over the torsion beam rear-axle setup and if more rear cargo area was needed, a wagon version called “Sport Tourer” was also available in some markets.

The range of petrol engines was topped out by the K4M 1.6-litre model, which used variable valve timing for the first time. The K9K turbodiesel engine was carried over, although this was now offered in three states of tune, with the most powerful featuring a larger turbocharger. The switch in market tactics proved successful, though, as the Clio III joined the

SAMPLE

supplierbusiness supplying the renault-nissan alliance · automotive supplierbusiness | supplying...

Documents