Nissan to stop Datsun production in Indonesia amid poor sales

26, Nov. 2019

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JAKARTA, NNA – Nissan Motor Corp. will stop production of the low-cost Datsun cars in Indonesia in January due to dismal sales, an Indonesian senior government official told NNA last Saturday.

Putu Juli Ardika, a senior government official at the Ministry of Industry, said it was no longer viable to produce the two Datsun models since “the scale of sales is below the economies of scale”.

The compact Datsun Go and Datsun Go+ seven-seater multipurpose vehicle were designed for emerging markets such as Indonesia where the Japanese carmaker also sells its more expensive models under Nissan brands.

Launched in Indonesia in 2014, sales of Datsun cars showed a quick decline after selling 29,651 units in 2015. Sales nosedived to 9,823 units in 2018 and then worsened in the first nine months of this year when only 3,478 units were produced, according to data from the Association of Indonesia Automotive Industries (GAIKINDO).

The budget Datsun cars have also been sold in India, Russia and South Africa, according to the Yokohama-based carmaker.

In an email to NNA on Friday, Isao Sekiguchi, President Director of PT Nissan Motor Indonesia, said the group plans to restructure its business by optimizing and rightsizing its operations.

Sales of Nissan brand car, such as Livina SUV and Serena multipurpose vehicle, in Indonesia also plunged to 6,999 units in 2018 from 26,779 units in 2015, according to GAIKINDO.

Reaffirming Nissan's commitment in the Indonesian market, Sekiguchi said, “As part of this plan, we have taken several actions to set us on a path for growth.”

Nissan will report details of its plans to Indonesian authorities.

Meanwhile, Nissan will localize engine production for Livina in Indonesia, which is Southeast Asia’s largest automobile market, instead of shipping the engines from Japan.

The move is done in partnership with PT. Mitsubishi Motors Krama Yudha Indonesia, the local manufacturing unit of Mitsubishi Motors Corp., which is Nissan’s capital alliance partner, Putu said.