Nissan enters North American LCV business

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Nissan North America Inc. announced April 7 that it is entering the light commercial vehicle business through a significant investment in North America. NNA, as part of a global commitment to the segment, will introduce to the North American market three LCVs in three years and forge partnerships with Cummins Inc. for the engines and ZF Friedrichshafen AG for the transmissions.

Leading the LCV business unit in the United States will be Joe Castelli, who has been named NNA vice president for light commercial vehicle and fleet. Key to this new strategy is the Nissan plant in Canton, Miss., which will become the manufacturing center for the new product line.

Nissan says it will introduce the three all-new products in three years, developed specifically for the North American market and built in Canton; the first of these three products will be launched in the first half of 2010. In the midterm, Nissan will expand its LCV business in North America, resulting in the creation of a multisegment product range of vehicles below 8-ton GVW. This initiative will result in the development of the three new products, as well as the future extension of the LCV range.

“Globally, the LCV business is now a substantial part of Nissan’s sales and profitability, representing a significant part of Nissan total vehicle sales,” says Andy Palmer, corporate vice president and head of the LCV global business unit, Nissan Motor Co. Ltd. “We already have major operations in Japan, China and Europe, and so it is natural that we are now ready to expand our business in North America.”

Castelli recently joined Nissan North America from Ford Motor Co., where he served for more than 23 years in various capacities, including commercial vehicle operations. He will oversee the expansion of the LCV business operations, which includes development, sales, marketing, service and distribution.

The dealer network will be selected from existing Nissan dealers, which will become specialized centers for the sales and servicing of Nissan’s LCV product range. NNA is beginning discussions with its dealer body to prepare for the arrival of LCVs.

Nissan’s facility in Canton will become the designated manufacturing center for the three LCVs, in core product segments in which Nissan currently does not compete in North America. In addition to the investment made for the tooling and development of the three vehicles themselves, Nissan will invest $118 million to expand Canton’s production facilities to manufacture LCVs.

“LCVs will become a major contributor to the future success of Nissan in North America,” says Bill Krueger, NNA senior vice president of manufacturing, purchasing and supply chain management and total customer satisfaction. “It is a tribute to our employees in Canton that it will be the manufacturing hub for these important new products, key to our sustainable growth in the U.S.”

In order to accommodate the capacity necessary to manufacture LCVs, Nissan will not produce the next-generation Nissan Quest minivan and Infiniti QX56 luxury SUV at Canton. Further details of the production shift will be announced at a later time.

Nissan has partnered with Cummins Inc. for the development and supply of two diesel engines, which will meet 2010 Environmental Protection Agency and California Air Resources Board emissions standards. The engines, tailored specifically for Nissan, will be manufactured in the United States. Nissan also has partnered with ZF Friedrichshafen AG for the development and supply of an automatic transmission.