Nissan builds passenger sedans, light trucks and pickups at its plants in Cuernavaca and Aguascalientes and the OEM has seen some tough challenges in recent years, as the US market’s tastes have changed from sedans to SUVs and pickups.
All Japanese auto makers have grappled with weak sedan sales in the United States as larger vehicles such as pickup trucks and sport utility vehicles grew more popular, due in part to falling petrol (gasoline) prices. For example,
Nissan’s sales of the Versa sedan were down 30.7 % from January through November 2018, compared with the same period in 2017. This change of demand has knock-on effects on finished vehicle logistics, as fewer trucks and SUVs than
sedans can be loaded onto a truck or railcar. I started our conversation by asking Daniel Saenzpardo about the most significant challenges he and his logistics teams face in the region.
Daniel Saenzpardo (DS): We face two main challenges from which other subtopics derive: changes within the automotive industry and the economic panorama, as well as the growth of the country’s supply chain infrastructure vs the automotive
DS: Not really; however, the infrastructure gradually needs to be adjusted in order to handle and store EVs and vehicles with new types of powertrain.
DS: Not really. In all the countries we operate, the actual capacity meets all the market requirements. However, there are some differences in the capacity flexibility; for example, Nissan Mexico operates six ports for export markets
in order to increase the shipping reliability against almost any unexpected external conditions.
DS: Not really. Historically, most of the suppliers are foreign-owned.
DS: Nissan is part of the Alliance, the most successful partnership in the automotive industry. Under the Alliance’s guidance, there are KPIs that help us benchmark the supply chain, taking in consideration different elements such
as Quality, Cost, Time and Safety. At Nissan Mexico, we mostly benchmark with Nissan North America, but also we have scheduled monthly and annual forums to receive a Global review of the overall performance of each region.
DS: This information is confidential!
DS: The balance mostly goes to trains due the operating costs.
DS: Yes, there are opportunities to create shipping routes from Lazaro Cardenas and Mazatlan ports to cover the West coast through short-sea.
DS: As in all the regions we have some routes that require special security management for both train and truck transportation. We need to be conscious that the ‘red spots’ change through time based on many external factors, such as
economic or political conditions. In case of train routes, we are exploring new technologies that will help us reinforce and provide insights and triggers in case of any security issues.
DS: In Mexico, we handle and schedule directly from the Tier 1 suppliers to our plants, even those suppliers that are in the sequenced scheme that are located between 100-200 kilometres away from the plants. Other regions commonly
use some consolidation centres then the Just-In-Time compliances are from shorter distances (less than 100 kilometres) reducing the Just-In-Time complexity.
DS: At Nissan, we select our supplier based on Quality, Cost, Time and Innovation. Our goal is to overachieve the client’s expectations; therefore, quality is one of the most important elements we take into consideration.
DS: Yes, our quality standard meets the overall Nissan PPM scheme.