International strategy of nissan in china

NATIONAL ECONOMICS UNIVERSITY ADVANCED EDUCATIONAL PROGRAM INTERNATIONAL BUSINESS GROUP INTERNATIONAL STRATEGY OF NISSAN IN CHINA NGUYỄN THỊ MINH HOẠT - 11201624 NGUYỄN TRÍ HIẾU NGUYỄN PHƯƠNG TRANG DƯƠNG PHƯƠNG THẢO - 11206914 Table of Contents PART I: INTRODUCTION Why Nissan is interesting? a) NISSAN IS OVER 100 YEARS OLD b) NISSAN IS TO JAPAN WHAT FORD IS TO USA c) NISSAN ONCE BUILT ROCKET ENGINES Nissan’s history: Demographics: .7 3.1 Gender Distribution .7 3.2 Age: 3.3 Length Employment: .9 3.4 Income Statement: .10 PART II: BUSINESS STRATEGY OF NISSAN 11 Penetration .11 1.1 Market screening: 11 1.2Final selection: 12 1.3Entry mode: 12 2.International business strategy: .12 3.Organization structure: 13 3.1 General .13 3.2 China 15 3.3 How to control international subsidiaries 16 Human resources policy and management: .19 4.1 Staffing policy .19 4.2 Recruitment policy .21 4.3 Learning and development 24 4.4 Remuneration and welfare 25 4.4 Advices for Foreign Businessman in Chinese market 31 4.5 Advices for Nissan in Chinese market 31 Turnover, expense, profit in the Chinese market and how to manage finance .32 PART III: RECOMMENDATION .37 I.Advices for Foreign Businessman in Chinese market 37 The power of guanxi 37 2 Narrow down the market .37 Hire local partners and learn from them 38 II Advices for Nissan in Chinese market .38 Aware of the Chinese business culture 38 Gaining market share 38 Demand for electric vehicles in the Chinese market 38 PART I: INTRODUCTION Why Nissan is interesting? Nissan Motor Company, a Japanese auto brand, is one of the leading automakers in the world With its headquarters in Yokohama, Japan, Nissan has a global footprint It is among the top ten biggest automobile brands in the world The brand has established itself as a leader in automotive innovation Nissan is also credited for introducing many advanced technologies and features that we now see in modern cars From economy cars to SUVs and EVs, Nissan has plenty to offer Following are three interesting facts about the legendary car manufacturer a) NISSAN IS OVER 100 YEARS OLD Nissan has a lifetime of 100-plus years The carmaker entered the auto industry in 1911 with its first line of cars sold under the brand name “Datsun” Datsun was also the name of ‘Nissan’s original heritage car’ However, there is the history behind the Datsun name and how it was used by Nissan Kwaishinsha Jidosha Kojo, founded in 1911, made cars for the Japanese market and planned to export them Two years later, in 1914, he completed work on a compact 2-cylinder 10horsepower car and named it DAT Later on, Kwaishinsha merged with the Jitsuyo Jidosha Co., Ltd and formed the Dat Jidosha Seizo Co The company went on to produce military vehicles Then, in 1931 the company developed a new 500cc, 10ps passenger car But since the car was smaller than the original DAT, it was named DATSON, which stands for “son of DAT” However, in Japanese, the term son refers to “loss” therefore the band name was changed to “SUN” when the car went on sale in 1932 Later on in 1934, both the companies, DAT Automobile Co and Jitsuyo Automobile Co., merged into one brand we now know as Nissan However, instead of using Nissan’s brand name on the car, the automakers decided to go with the brand name Datsun which was already familiar to the car audience of that time The automotive company officially retired the brand name Datsun in 1986 However, Nissan relaunched the brand name ‘Datsun’ for its low-cost vehicle line in 2013 but discontinued it in 2020 Since its inception, the automotive giant entered diverse engineering markets, partnered with different companies and competed in a few car races b) NISSAN IS TO JAPAN WHAT FORD IS TO USA It is a well-known fact that America was the leader in car production throughout the world in the first few decades of the automotive industry’s existence But did you know that later on as the automotive industry evolved Nissan became the market leader? Then known as Nihon Sangyo Company Limited, the company took care of Japan’s majority of car needs Much like Ford took care of the American car audience’s needs This was somewhere around the early 20th century After acquiring Datsun in 1932, the automotive giant grew the brand by introducing various car bodies starting from pickup trucks to convertibles c) NISSAN ONCE BUILT ROCKET ENGINES The auto giant was not only in cars it was also active in the aerospace industry The Lambda 4S-5 spacecraft engines were designed and developed by Nissan In 1970, the spacecraft launched Japan’s first-ever satellite – the OHSUMI into space However, in 2020 Nissan sold its aerospace division to focus on the auto business exclusively Nissan’s history: 1960-1969: PERFORMANCE BECOMES ONE WORD - DATSUN Nissan Motor Corporation in the U.S.A (NMC) was established in Gardena, California That same year, the SPL 201—Datsun’s very first sports car—was introduced The sleek 4-seat roadster featured a fold-down soft-top, a "4 on the floor" transmission and a 48-hp engine That would soon be replaced by a powerful 85-hp version.In 1966, the first Japanese-owned production facility in North America, Nissan Mexicana manufactures its first vehicle Toward the end of this decade of change, Nissan built a strong reputation in both the American and the Japanese markets The 24OZ came to America in 1969 First unveiled at the Pierre Hotel in New York in October of 1969, the 240Z was an instant hit with media and enthusiasts alike 1970-1979: PUSHING THE LIMITS OF DATSUN BUILDING A SOLID REPUTATION The 70s were a great decade for Nissan Nissan sold the one-millionth Datsun and became the top vehicle importer in the United States by 1975 In 1971, annual sales eclipsed 250,000 in the United States for the first time Nissan also established itself on the track, as the now-legendary Datsun 510 and 240Z dominated racing on two continents; winning the SCCA Trans Am 2.5 Championship, the American Rally Championship and the treacherous East African Safari In 1973, the 1-Millionth Vehicle was sold in America In 1975, Datsun became the top U.S vehicle importer In 1979, Nissan Design America (NDA) was established in La Jolla, California, with a mandate to bring American style and concepts to Nissan vehicles 1980-1989: FINDING OUR STRIDE, BUILDING ON RACING LEGENDS In the '80s, as manufacturers worldwide struggled to forge their identity, Nissan built upon its successes of the 1970s – both in the showrooms and on the racetrack NIssan also built the first Nissan truck in the United States In 1980, Nissan Motor Manufacturing Corporation (NMMC) was established in Smyrna, Tennessee, to fulfill the growing demand for Nissan vehicles In 1989, Nissan produced the 1-millionth vehicle on American soil, and started the Summer Institute for Historically Black Colleges and Universities 1990-1999: A DECADE OF AGILITY Nissan demonstrates its agility by retaining the Nissan heritage while moving in new directions In 1991, Nissan received its first environmental award from the EPA, and took a big leap forward in green technology by lending its Alternative Fuel Vehicle to a California testing program and introducing the Future Electric Vehicle concept car In 1997, Nissan was named “Best of the Best” by the Environmental Protection Agency, and Nissan Smyrna was lauded as the most productive plant in North America in "The Harbour Report” for a fourth consecutive year 2000-2009: A NEW CENTURY OF THRILLS Nissan has nearly doubled the number of models offered and nearly doubled its sales In 10 years, the diverse lineup has grown to include Nissan's first full-sized truck, all-new hybrid technology and a 21st-Century supercar And this is only the beginning of what's to come The first full-size Nissan truck, the TITAN®, debuted in 2003 as a 2004 model Today, the V8-powered pickup is available with a King Cab or a Crew Cab In 2007, Next-generation technology thrived with Maxima, Altima, Sentra, Quest, Versa Hatchback and Versa Sedan 2010-2020: THE DAWN OF NISSAN ELECTRIFICATION Nissan helped to lead the automotive industry into the age of electric vehicles when it debuted the all-electric Nissan LEAF® and throughout the decade continues its tradition of innovation that excites with all new vehicles like the Nissan Kicks and safety technology like its available Safety Shield® 360 suite of features Document continues below Discover more from: International business Đại học Kinh tế Quốc dân 5 documents Go to course Assignment week International business None Chương Phân tích hội kinh doanh quốc tế International business None Strategies International business None UK Pestle Analysis 68 International Marketing 100% (2) Tata-Motors-SC2122 - Very good International Supply chain management 100% (2) Indi Assignment GSCM International Supply chain management 100% (1) 2021-PRESENT: A NEW ERA OF THRILL Nissan storied history has spanned more than 90 years but it is just getting started From electrification, to buying a Nissan@Home to the latest generation of Nissan capability in trucks, SUVs and sports cars, the latest chapter is unfolding now Demographics: 3.1Gender Distribution  Nissan is a male-dominated company 67% of Nissan employees are male and 33% of Nissan employees are female 3.2Age:  The most common age range of Nissan employees is 20-30 years 54% of Nissan employees are between the ages of 20-30 years  The least common age range of Nissan employees is less than 18 years 1% of Nissan employees are between the ages of less than 18 years 3.3Length Employment:  A plurality of employees at Nissan stay for 1-2 years 30% of Nissan employees stay at the company for 1-2 years  It's rare for an employee to stay with Nissan for 8-10 years Only 7% of Nissan employees stay at the company for 8-10 years 3.4Income Statement: Global production rose by 9.0 percent year-on-year to 909,000 units in the three months to December 31 This represented an accelerating trend on the 2.4 percent increase in production volume to 2.526 million units achieved in the first nine months of the fiscal year year-on-year unit sales declined 6.9 percent to 842,000 units in the third quarter The third quarter retail sales varied noticeably around the world An employee’s salary is determined through a combination of performance evaluations measuring to what extent the employee achieved certain goals and competency evaluations measuring skills, knowledge and attitude  Welfare  Respecting the rights of workers: Based on the idea of fostering a people-centered corporate culture, Nissan is cultivating a workplace environment where employees can work with peace of mind To that end, it is essential that employees’ human rights are respected throughout the organization and Nissan is building a framework to address this issue in a systematic way In 2021, Nissan released the “Nissan Global Guideline on Human Rights”, which is a compilation of specific action points on how to respect employees’ human rights The document covers seven themes in light of Nissan’s business activities which are Labor management system and access to remedy, Forced labor, Child labor and Young workers, Working conditions, Discrimination, Freedom of association, Health and Safety  Dialogue with employees: For a company to continue offering new value in the face of rapid changes in the social and business climate, it is essential for its employees to embrace the company’s corporate purpose as well as its mission and consciously work toward realizing them Nissan established guiding principles for communication that aim to encourage higher employee engagement: “building trust” and “ increasing employee motivation” Nissan utilizes various communications tools to deepen employees’ understanding of their business, products and brands as well as to explain the direction in which they are heading in order to generate employee confidence in their day-to-day activities and in the future of the company  Employees’ Health and Safety: To demonstrate that occupational health and safety are the top priorities in the company business activities regardless of country, region, or division, Nissan established the Global Policy on Occupational Health and Safety 26 Nissan Basic Policy states that “From top management to each individual employee, Nissan recognizes that the health and safety of everyone is our top priority” The company continuously and aggressively strives toward realizing zero-accidents, zero-illness, and vigorous workplace safety by optimizing the working environment and promoting individual physical and mental health HRM of Nissan in China:  Employee rights and interests: Nissan's subsidiaries in China view "employees as the impetus of Nissan's sustainability" in their talent management, make employee rights and interests the basis of their HR management,conscientiously comply with labor-related laws and regulations, and provide their employees a safe working environment through equal workplace, well-developed remuneration and welfare system, diversified communication mechanism and comprehensive protection of occupational safety and health  Talent cultivation: Nissan's subsidiaries in China regard every employee as a valuable resource and firmly believe that the growth of employees is an important foundation for the company's sustainable development The company respects the development wishes of employees, supports employees to realize their own value, constantly promotes the talent development system and employee training plan, and helps employees give 27 full play to their personal potential, thus facilitating the common growth of employees and the company *Showing turnover, expensive, profit in this market In China, retail sales were down 6.9 percent to 292,000 units in the third quarter as the COVID lockdown continued to impact customer traffic Unit sales were negatively impacted by three main issues: - Firstly, the ongoing disruption in China caused by COVID-19, - Second, shortages of semiconductors in the US for compact segment models - Third, vehicle exports are hampered by constraints in global logistics Despite these challenges, Nissan is making steady progress with its Nissan NEXT business transformation plan,which is the four-year plan aims to achieve 28 sustainable growth, financial stability and profitability by the end of March 2023 This is evidenced by the improving net revenue per unit of major models On a proportionate basis, which includes our China operations, net revenue for the nine- month period rose to 8.45 trillion yen from 7.11 trillion yen last year Operating profit under this measure reached 375.2 billion yen for the period, representing an operating margin of 4.4 percent Despite our China JV continuing to generate positive free cash flow, the automotive free cash flow on proportionate basis was a negative 32.2 billion yen for the nine-month period This is because the dividend payment from China JV to Nissan is not included in free cash flow on proportionate basis Net cash for the automotive business reached 1.57 trillion yen on this basis How to manage finance Financial activities within the Group are managed centrally by the Finance and Accounting Department of the Company The Group is engaged in activities to improve cash efficiency through the implementation of a global cash management system The Group has developed a basic financial strategy under which the Group raises funds from appropriate sources and maintains an appropriate level of liquidity and a sound financial position 29 The Group manages the investments in research and development activities and capital expenditures at a relatively constant rate against annual sales The Group decides the distribution of dividends to shareholders, considering various factors including profits and free cash flows FINANCIAL MANAGEMENT Liquidity Nissan has a liquidity risk management policy that is intended to ensure adequate liquidity for the business while at the same time ensuring mitigation of liquidity risks such as unmanageable bunched maturities of debt In the policy, minimum liquidity requirements are defined taking into consideration several factors including debt maturity, upcoming mandatory payments—such as dividends, investments and taxes—and peak operating cash needs Nissan also benchmarks liquidity targets with other major Japanese corporations and global auto companies to ensure assumptions are reasonable Financial Market Foreign Exchange Nissan faces various foreign currency exposures that result from the currency of purchasing cost being different from the currency of sale to customers In order to minimize foreign exchange risk on a more permanent basis, Nissan is working to reduce foreign currency exposure by such measures as shifting production to the countries where vehicles are sold and procuring raw materials and parts in foreign currencies Interest rate The interest rate risk-management policy is based on two principles: long- term investments and the permanent portion of working capital are financed at fixed interest rates, and the nonpermanent portion of working capital and liquidity reserves are built at floating rates Commodity prices Nissan is exposed to the price fluctuation risks of raw materials, no matter whether purchased directly or indirectly For precious metals,to minimize commodity price risk, Nissan is making continuous efforts to reduce usage through technological innovation In the short term, Nissan manages commodity price volatility exposure through the use of fixed-rate purchase contracts in which commodity prices are fixed for a period of time Counterparties Nissan has established transaction terms and conditions for operating receivables in Japan and overseas based on credit assessment criteria to protect such receivables 30 As for financial transactions including bank deposits, investments and derivatives, Nissan manages our counterparty risk by using an evaluation system based on external credit ratings and other analysis 4.4 Advices for Foreign Businessman in Chinese market a) The power of guanxi The concept of guanxi is central to Chinese culture The closest English translation of the word is “relationships.” At its core, guanxi points to the importance of building a strong network within the business community The Chinese have high regard for relationships built outside business meetings and boardrooms, so it takes significant patience and effort to nurture guanxi Once established, it builds personal trust and helps open the door to potential business opportunities Western leaders tend to prioritize getting down to business as quickly as possible There's little patience for small talk In China, business partnerships tend to last a long time, so they are based on carefully cultivated relationships with people who are known and trusted Commerce is based on the deep mutual respect that develops slowly This builds trust and strengthens the all-important relationships between people b) Narrow down the market Due to China’s huge population, it’s generally not a good idea to target the whole country in your initial efforts Instead, choose a specific region or large city When selecting a market, you’ll want to start by comparing the benefits and risks of various regions Look at market potential criteria such as the size of potential markets, GDP growth and demand for your product or service Then, compare them to risk criteria such as your team’s knowledge and experience in that market, ease of doing business and tariff rates This exercise will provide you with measurable data to narrow down your list of potential markets One option is to target a more developed area as a way to get to know the country An example is Hong Kong, with its sophisticated infrastructure, duty-free port, abundance of suppliers and concentrated large population c) Hire local partners and learn from them If you're planning to expand to any foreign market, you're far more likely to be successful if you rely on local partners who can guide you through the cultural and logistical hurdles that await you This is especially true in the case of China, a country whose values and systems are still largely misunderstood by most casual Western observers 31 4.5 Advices for Nissan in Chinese market Nissan has always considered China to be a core market for the company Especially after struggling to recover from a boardroom scandal surrounding Carlos Ghosn and a sales slump that threatens its alliance with Renault, China is becoming Nissan's last line of defense To so, our team have some following suggestions: a)Aware of the Chinese business culture Like we have mentioned, Chinese culture still places a high value on the collective As a Western business leader, you need to respect this influence and understand that your Chinese partners and customers may not define value the same way you b)Gaining market share Gaining China market share is critical for the future growth of any automakers Nissan’s competitors such as Toyota and Honda constantly introduce new cars into the Chinese market If Nissan doesn’t want to be left behind by those competitors, the company needs to focus on introducing new models at a steady clip If Nissan delays even slightly, it will immediately be put in a weaker position c)Demand for electric vehicles in the Chinese market Despite being one of the world’s first automakers to fully embrace fully electric cars with its best-selling Leaf, Nissan has fallen behind Toyota and Honda, analysts said Both launched a slew of new hybrids in China in 2019 and 2020 which has helped boost their sales Moreover, many local brands are now producing betterquality cars and that’s putting pressure on Nissan’s mainstream cars, as well as vehicles produced by other global automakers Nissan should have a broad plan to focus on the electric vehicle field with upgraded features in order to maintain the competitiveness and position in the Chinese market Besides the focus on electric vehicles, the plan should also involve using more locally made parts and technologies to reduce costs and help Nissan compete better with lower-cost Chinese firms and major global rivals Turnover, expense, profit in the Chinese market and how to manage finance In China, retail sales were down 6.9 percent to 292,000 units in the third quarter as the COVID lockdown continued to impact customer traffic Unit sales were negatively impacted by three main issues: 32  - Firstly, the ongoing disruption in China caused by COVID-19,  - Second, shortages of semiconductors in the US for compact segment models  - Third, vehicle exports hampered by constraints in global logistics  Despite these challenges, Nissan is making steady progress with its Nissan NEXT business transformation plan,which is the four-year plan aims to achieve sustainable growth, financial stability and profitability by the end of March 2023 This is evidenced by the improving net revenue per unit of major models due to ongoing efforts in the enhancement of quality of sales and in cost optimization In addition, financial discipline, and strict control of fixed costs, coupled with the positive impact of the depreciation of the yen to a higher-than-expected level, 33 contributed to the significant improvement in performance compared with the previous fiscal year On an equity basis, which excludes contributions from our China JV operations, our net revenues for the period increased to 7.50 trillion yen from 6.15 trillion yen in the same period last year On the same basis, operating profit for the period was 289.7 billion yen, with an operating margin of 3.9 percent Nissan’s automotive profit is also positive for the nine-month period For the nine-month period, net income was 115.0 billion yen Free cash flow for the automotive business was a positive 21.0 billion yen for the nine-month period The positive free cash flow in the second and third quarters covered the negative free cash flow in the first quarter, which was due to low production On a proportionate basis, which includes our China operations, net revenue for the nine- month period rose to 8.45 trillion yen from 7.11 trillion yen last year Operating profit under this measure reached 375.2 billion yen for the period, representing an operating margin of 4.4 percent Despite our China JV continuing to generate positive free cash flow, the automotive free cash flow on proportionate basis was a negative 32.2 billion yen for the nine-month period This is because the dividend payment from China JV to Nissan is not included in free cash flow on proportionate basis Net cash for the automotive business reached 1.57 trillion yen on this basis 34 Financial activities within the Group are managed centrally by the Finance and Accounting Department of the Company The Group is engaged in activities to improve cash efficiency through the implementation of a global cash management system The Group has developed a basic financial strategy under which the Group raises funds from appropriate sources and maintains an appropriate level of liquidity and a sound financial position so that the Group can make investments in research and development activities, capital expenditures and its finance business on a timely basis The Group manages the investments in research and development activities and capital expenditures at a relatively constant rate against annual sales The Group plans to focus our business resources on core markets, core models and core technologies The Group focuses on the quality of the financial assets and invests in its sales finance business The Group decides the distribution of dividends to shareholders, considering various factors including profits and free cash flows  FINANCIAL MANAGEMENT  Liquidity An automotive business must have adequate liquidity to provide for the working capital needs of normal day-to-day operations, ongoing research and development, capital investment needs for future expansion and repayment of maturing debt Liquidity can be secured through cash and cash equivalents, internal cash flow generation and external funding Nissan has a liquidity risk management policy that is intended to ensure adequate liquidity for the business while at the same time ensuring mitigation of liquidity risks such as unmanageable bunched maturities of debt In the policy, minimum liquidity requirements are defined taking into consideration several factors including debt maturity, upcoming mandatory payments—such as dividends, investments and taxes—and peak operating cash needs Nissan also benchmarks liquidity targets with other major Japanese corporations and global auto companies to ensure assumptions are reasonable  Financial Market Nissan is exposed to various financial-market-related risks, such as foreign exchange, interest rates and commodity prices Although it is not possible to eliminate all the risks with the use of derivative products, Nissan does hedge select 35 currencies and commodity price risks on an opportunistic basis to reduce financial market risks  Foreign Exchange Nissan faces various foreign currency exposures that result from the currency of purchasing cost being different from the currency of sale to customers In order to minimize foreign exchange risk on a more permanent basis, Nissan is working to reduce foreign currency exposure by such measures as shifting production to the countries where vehicles are sold and procuring raw materials and parts in foreign currencies In the short term, Nissan may limit risks in foreign exchange volatility within a certain range by using derivative products in accordance with the internal policies and procedures for risk management and operational rules regarding derivative transactions  Interest rate The interest rate risk-management policy is based on two principles: long- term investments and the permanent portion of working capital are financed at fixed interest rates, and the nonpermanent portion of working capital and liquidity reserves are built at floating rates Nissan may hedge risks of interest rate fluctuation by using derivative products in accordance with the internal policies and procedures for risk management and operational rules regarding derivative transactions  Commodity prices Nissan purchases raw materials in the form of parts provided by the suppliers, as well as direct purchase, and it is exposed to the price fluctuation risks of raw materials, no matter whether purchased directly or indirectly For precious metals, which are used in catalysts, to minimize commodity price risk Nissan is making continuous efforts to reduce usage through technological innovation In the short term, Nissan manages commodity price volatility exposure through the use of fixed-rate purchase contracts in which commodity prices are fixed for a period of time; Nissan may also hedge risks in commodity price volatility within a certain range by the use of derivative products in accordance with the internal policies and procedures for risk management and operational rules regarding derivative transactions  Counterparties 36 Nissan does business with a variety of local counterparties, including sales companies and financial institutions in many regions around the world This exposes us to the risk that such counterparties could default on their obligations Nissan has established transaction terms and conditions for operating receivables in Japan and overseas based on credit assessment criteria These criteria enable to take measures to protect such receivables and may include bank letters of credit and/or advance payment requirements As for financial transactions including bank deposits, investments and derivatives, Nissan manages our counterparty risk by using an evaluation system based on external credit ratings and other analysis We enter into such transactions only with financial institutions that have a sound credit profile within their respective countries PART III: RECOMMENDATION I.Advices for Foreign Businessman in Chinese market The power of guanxi The concept of guanxi is central to Chinese culture The closest English translation of the word is “relationships.” At its core, guanxi points to the importance of building a strong network within the business community The Chinese have high regard for relationships built outside business meetings and boardrooms, so it takes significant patience and effort to nurture guanxi Once established, it builds personal trust and helps open the door to potential business opportunities Western leaders tend to prioritize getting down to business as quickly as possible There's little patience for small talk In China, business partnerships tend to last a long time, so they are based on carefully cultivated relationships with people who are known and trusted Commerce is based on the deep mutual respect that develops slowly This builds trust and strengthens the all-important relationships between people Narrow down the market 37 Due to China’s huge population, it’s generally not a good idea to target the whole country in your initial efforts Instead, choose a specific region or large city When selecting a market, you’ll want to start by comparing the benefits and risks of various regions Look at market potential criteria such as the size of potential markets, GDP growth and demand for your product or service Then, compare them to risk criteria such as your team’s knowledge and experience in that market, ease of doing business and tariff rates This exercise will provide you with measurable data to narrow down your list of potential markets One option is to target a more developed area as a way to get to know the country An example is Hong Kong, with its sophisticated infrastructure, duty-free port, abundance of suppliers and concentrated large population Hire local partners and learn from them If you're planning to expand to any foreign market, you're far more likely to be successful if you rely on local partners who can guide you through the cultural and logistical hurdles that await you This is especially true in the case of China, a country whose values and systems are still largely misunderstood by most casual Western observers II Advices for Nissan in Chinese market Nissan has always considered China is a core market for the company Especially after struggling to recover from a boardroom scandal surrounding Carlos Ghosn and a sales slump that threatens its alliance with Renault, China is becoming Nissan's last line of defense To so, our team have some following suggestions: Aware of the Chinese business culture Like we have mentioned, Chinese culture still places a high value on the collective As a Western business leader, you need to respect this influence and understand that your Chinese partners and customers may not define value the same way you Although some elements of Western-style individualism have begun to enter into Chinese culture, for many people individual accomplishments or desires will still be secondary to societal, familial or organizational obligations Gaining market share As automakers fight for survival in the era of ride-sharing, autonomous driving and connected cars, gaining China market share is critical for future growth Nissan’s competitors such as Toyota and Honda constantly introduce new cars into the Chinese market If Nissan doesn’t want to be left behind by those competitors, the company needs to focus on introducing new models at a steady clip If Nissan delays even slightly, it will immediately be put in a weaker position 38 Demand for electric vehicles in the Chinese market Despite being one of the world’s first automakers to fully embrace fully electric cars with its best-selling Leaf, Nissan has fallen behind Toyota and Honda, analysts said Both launched a slew of new hybrids in China in 2019 and 2020 which has helped boost their sales Moreover, many local brands are now producing betterquality cars and that’s putting pressure on Nissan’s mainstream cars, as well as vehicles produced by other global automakers Nissan should have a broad plan to focus on the electric vehicle field with upgraded features in order to maintain the competitiveness and position in the Chinese market Besides the focus on electric vehicles, the plan should also involve using more locally made parts and technologies to reduce costs and help Nissan compete better with lower-cost Chinese firms and major global rivals 39 40