SPEECHES

June 29, 2011

Annual General Shareholders' Meeting

Carlos Ghosn:
Reviewing Nissan's business performance in fiscal year 2010, I am pleased to report that it was a record year for Nissan in terms of sales and growth. Coming out of the financial crisis, Nissan again demonstrated its ability to respond to adversity. We overcame immediate challenges without sacrificing any strategic priority.
Toward the close of the fiscal year, however, a natural catastrophe struck Japan. The Japanese auto industry ended the fiscal year back in recovery mode. The earthquake and tsunami triggered massive business losses, and the tragedy had a human side as well. Like so many families in Japan, the Nissan family also suffered, with the loss of five employees and associates.
Please join me in remembering them and their contributions and in reflecting on the tremendous losses experienced by so many in Japan.

Due to the tireless efforts of the global Nissan team, we have made significant progress toward the restoration and recovery of our operations. We have a healthy balance sheet, an experienced management team and a strong foundation from which we will resume our company's growth.
I now invite Shiga-san to review our performance in fiscal 2010... tell you about Nissan's earthquake recovery actions... and share with you our forecast for fiscal year 2011.

Toshiyuki Shiga:
I will begin with a summary of Nissan's sales performance in fiscal 2010.
The total industry volume in fiscal 2010 was up 12.6%, driven by significant growth in emerging markets.
Nissan's global sales increased 19.1%.
Our sales were supported by the launch of 10 new models, including:

  • Our first electric vehicle, Nissan LEAF, and a new compact car, Juke, in Japan, United States and Europe;
  • Elgrand, Serena and Moco in Japan;
  • Infiniti QX in the United States, Middle East and Russia;
  • Murano CrossCabriolet and the NV Van series in the United States;
  • Quest minivan in the United States and Canada; and
  • Our new affordable compact sedan, Sunny, in China.

Now, please let me review our sales by region.

[Japan]
Starting in Japan, the total industry volume decreased due to the end of eco-car subsidies and the earthquake. Our sales decrease was limited to 4.7%, driven by new models such as the Juke, Elgrand and Serena.

[China]
In China, our sales grew 35.5% and maintained the largest growth among all Japanese automakers.

[U.S]
In the United States, as the market recovers at slow pace, fuel-efficient models such as Rogue and Sentra and increasing sales of Infiniti models contributed to our results, and we achieve a record-level 8% market share.

[Europe]
In Europe, despite market contraction, our sales were strong. Sales in Russia were nearly double, and in Western Europe Juke and the QASHQAI series contributed to the sales increase.

[Other results]
Nissan's expansion in China was a priority for our company in fiscal 2010.
Our significant investments in China began eight years ago, and growth has been fast and strong. China became our largest single market, with our sales exceeding 1 million units in fiscal 2010, accounting for nearly a quarter of our total global sales.
The market is expected to continue growing. We are taking many initiatives - such as the opening of our Design Center in Beijing - to develop products with more focus on the customer.
We have also been taking big strides forward in our strategy to offer "Mobility for all" and continuing our investments in very affordable transportation.
In India, through our joint venture with Ashok Leyland, we announced our first price-entry commercial vehicle, the DOST.
We launched localized production and sales of our global compact car March/Micra in Thailand, India, China and Mexico, and the product has been well received by all markets.

FY2010 financial results
Now let us take a look at how our performance was reflected in our financial results.
At the close of fiscal year 2010, our consolidated revenues increased 16.7% to 8 trillion 773 billion yen. Consolidated operating profits totaled 537.5 billion yen. Net income reached 319 billion yen.
For non-consolidated figures, please refer to the business report of the 112th fiscal period you have received.

Net automotive debt
Our net automotive debt incurred during the financial crisis in late 2008 improved to a net cash position of 293 billion yen.

Activities since March 11 earthquake
Let me now talk about actions we have taken since the March 11 earthquake.
Due to their proximity to the epicenter, Nissan's Iwaki and Tochigi plants suffered serious damage. We initially expected to take a longer time to restore the operations due to the immensity of the damage. Nevertheless people of Nissan were united against a challenging situation and responded with strong determination.
As a result, we restarted production at all our assembly plants in Japan based on normal operations with the delivery of parts from available suppliers on April 11, one month after the earthquake.
Thanks to dedicated restoration activities with support from other plants and affiliates, the Iwaki engine plant recommenced production on the assembly line on April 18, and remaining lines resumed operations on May 17.
While the disaster disrupted our supply chain, the situation is improving faster than our initial projection, thanks to effective actions, including restoration support and alternative sourcing for parts and components. It is going to take more time for full normalization without restriction, but please rest assured since things are dramatically improving.
Another challenge is anticipated electricity shortages in the upcoming summer months. To counter the issue, we are implementing company-wide conservation efforts. We decided to switch working days, change working hours and use in-house electricity generation to target a 15% reduction in electricity use in summertime.

FY2011 financial forecast
Let's move to our FY2011 outlook.
In fiscal year 2011, the global total industry volume is expected to increase 4.7%. Based on this assumption, we expect our global sales to reach 4.6 million units, an increase of 9.9%, thanks to our swift recovery from the earthquake and our sales efforts in all markets.
For fiscal year 2011, we forecast the following:

  • Net revenue is forecast to be 9.4 trillion yen.
  • Operating profit is expected to be 460 billion yen.
  • Net income is forecast to be 270 billion yen.

We will launch five new models globally, including:

  • The new Lafesta Highway STAR minivan in Japan;
  • Tiida, a global model starting with China;
  • Front-wheel drive and rear-wheel drive of NV400 series in Europe; and
  • A new Infiniti model in the United States.

In fiscal year 2011, we will introduce many new technologies. Let me describe some of them.
A new 3-cylinder downsized direct-injection engine equipped with a supercharger delivers top-level fuel efficiency among gasoline-powered cars in the world.
Around View Monitor, which is well received by the market, is now advanced to detect moving objects and notify the driver.
Another new technology assists when you are backing the car by activating a brake when another vehicle gets in your way.
An engine we jointly developed with Renault enjoys class-leading fuel economy and dynamic performance.
We are introducing a large number of innovative technologies and products.
Nissan's recovery from the earthquake is faster and stronger than our initial assumption. Our significant performance represents the true strength of Nissan's monozukuri and solidarity of the team. We will maintain this momentum and be positioned for further growth.
For more information about our company's future, I turn the program back over to Mr. Ghosn, who will review Nissan's strategy, including the new midterm business plan.

Carlos Ghosn:
Nissan Power 88
Since the beginning of the Renault-Nissan Alliance in 1999, Nissan has launched four midterm plans; our new plan is the fifth. Each plan has focused on growth and enriching people's lives. This plan builds upon all lessons learned, synergies developed and investments made since 1999.
This new midterm plan is a wide-ranging, ambitious plan for fiscal years 2011 to 2016 that accelerates Nissan's growth.
The name of our new plan is Nissan Power 88.
"Power" derives its significance from the strength and efforts we will apply to our brands and sales. We commit to renewing our focus on and improving the overall customer experience.
"88" measures the rewards from achieving our plan. We aim to achieve a global market share of 8%. And we will increase our corporate operating profit margin to a sustainable 8%.
Nissan Power 88 is a six-year plan. To explain the plan, let me begin with the products.
Nissan's global product lineup is already wide and deep. During Nissan Power 88, we will deliver one new vehicle every six weeks, on average, for the next six years. In all, 51 new models will be launched, broadening our range of models for both the Nissan and Infiniti brands.
In 1999, Nissan had 49 vehicles in its global product range, covering 77% of markets and segments. Today we have 64 vehicles covering 80% of markets and segments. By 2016, Nissan will have 66 vehicles, covering 92% of segments and markets worldwide.
We will also develop more than 90 new advanced technologies, averaging 15 per year.
We will deliver a complete renewal of our popular global growth models, such as the Altima, Teana, and QASHQAI.
We will widen our portfolio of Infiniti products to achieve a 10% global market share among luxury products in 2016. This expansion will include the Infiniti JX crossover in the spring of 2012 and a dedicated electric vehicle by 2014.
We will address specific needs of Chinese customers by offering a broader range of Nissan and Infiniti vehicles. We are firm in our resolve to reach 10% market share in China. We are also working with our Chinese partner, Dong Feng, to co-develop a range of models for the local-market Venucia brand.
We will expand our V-platform range of global products by one model, for a total of three, that will help us to reach more than 1 million units in 2016.
We are also focusing more attention on the price-entry segment to serve a growing number of customers in the emerging markets.
Nissan's longstanding presence in the commercial vehicle segment is also gaining momentum. A Nissan light commercial vehicle will soon be the new "yellow cab" of New York City since it was chosen in competition to be the "Taxi of Tomorrow."
By fiscal 2016, Nissan will be the world's leading light commercial vehicle manufacturer.

Nissan Power 88 strategies
Nissan Power 88 identifies six strategies as levers we will use to achieve results. The six strategic levers are:

  • Strengthening our brand power;
  • Enhancing our sales power;
  • Enhancing quality;
  • Optimizing Nissan's zero-emission leadership;
  • Accelerating our growth through business expansion; and
  • Reducing our costs.

Let me describe each one.
The first lever is about strengthening Nissan's brand power.
We want to raise the level of interaction with our customers to create a world-class standard of service that will help us build direct, lasting relationships with every Nissan car owner.
Having a stronger brand will help us close gaps with our top competitors... and using large-scale brand platforms, such as Infiniti's investment in Formula One and Nissan's zero-emission strategy, will help to build our brands' global awareness and reputation.
Nissan LEAF has helped to create a positive brand advantage for us over the past year, as it was recognized as the "2011 World Car of the Year" and "European Car of the Year 2011." We want to replicate its success on a broader scale.
The second strategic lever is enhancing our sales power.
Sales power refers to fully grasping the needs of customers in each market and drastically raising sales volume and market share.
Nissan currently has 6,000 major points of sales globally. We will expand our retail network to 7,500 outlets.
Nissan is now the leading Japanese brand in China, Russia and Mexico and is on track to become the largest volume Asian brand in Europe by 2016. We will focus our efforts to boost sales power in Japan, in the United States as well as in the ASEAN region.
A third lever in our plan is enhancing quality.
Nissan aims to make steady progress in improving product quality. During Nissan Power 88, our aim is to raise Nissan into the top group of global automakers in product quality and to elevate Infiniti to leadership status among peer luxury products.
The fourth lever relates to advancing our zero-emission leadership in the global car market.
No other global automaker is as engaged in making sustainable mobility a reality as we are. Nissan is taking a leadership role in every aspect, from the development of batteries, chargers and a vehicle lineup to electric grid studies, battery recycling and the use of batteries for energy storage.
This year, Nissan will take the lead as the all-time volume leader in electric vehicle sales. The Alliance is bringing seven more all-electric models to follow the successful launch of Nissan LEAF. Nissan's EV lineup will include a light commercial vehicle and an all-electric premium car to be launched by Infiniti in 2014. Together with our Alliance partner Renault, we intend to put 1.5 million EVs on roads worldwide by 2016.
The fifth lever relates to expanding our business to accelerate growth.
In 1999, Nissan's global market share was 4.6%. In 2010, Nissan achieved a record 5.8%. For fiscal 2016, we are targeting 8%.
We will achieve this by launching, on average, a new product every six weeks for six years, keeping our focus on growth markets and expanding our Infiniti and light commercial vehicle businesses.
We will also concentrate on increasing our presence in Brazil, India and Russia, as well as in the next wave of emerging markets, including the ASEAN 5 - namely, Indonesia, Thailand, Malaysia, Philippines and Vietnam. Before the crisis, emerging markets accounted for 40% of world market. By FY16, they will represent 60% of global sales.
Nissan is the top Japanese car maker in China, and China will continue to be Nissan's largest single global market into the plan. In 2012, we will have nearly doubled our production capacity, to more than 1 million units. With our partner Dong Feng, we will continue to invest in more products and dealers and build our new local brand, Venucia.
In North America, we will invest to expand our manufacturing capacity and retain our number-one market share position in Mexico.
In Brazil, we will build a new plant, with a capacity of 200,000 units as the first step.
In Europe, Nissan will become the largest volume Asian brand, and we will increase our market share in Russia.
In India, we will add five new models to be built in the new Alliance plant in Chennai and continue to expand our dealer network.
In ASEAN, Nissan Motor Thailand now serves as a strategic industrial base and export hub, and we are concentrating on growth in Indonesia. We are doubling the capacity of our plant near Jakarta to meet local demand.
Finally, growth in any market is not possible without a high level of cost competitiveness, so the sixth pillar of our plan is cost leadership
Since we implemented the Nissan Revival Plan, we have been successful in reducing costs by 5% annually. We aim to maintain this pace and have set an objective to reduce the total cost by 5% each year.
Enhancing our monozukuri activities in Japan and across the regions is key to our cost reduction efforts. Through these activities, we will maintain our commitment to produce 1 million vehicles per year in Japan.

Alliance status
After 12 years of successful partnership, the Renault-Nissan Alliance helps to define who we are and how we work. Our ability to work with other companies with respect, trust and transparency over the long term is unique in our industry.
In fiscal year 2010, we signed a strategic cooperation with Daimler. We also expanded the scope of cooperation with Mitsubishi, with the creation of our new mini car joint venture.
We have a global network of partners - Dongfeng, Daimler, AvtoVAZ, Ashok Leyland, Mitsubishi - and we take advantage of respective strengths and sharing of best practices to increase our mutual competitiveness.
Our desire is to create greater value for all our stakeholders - for our customers, our employees, our partners and for you, our shareholders.

Dividend policy
We remain committed to enhancing shareholder returns through profitable business growth and the maintenance of a strong balance sheet. As part of our shareholder return policy, we are planning for the distribution of a sustainable and attractive dividend over the course of the midterm plan.
For fiscal year 2011, Nissan projects an increase in the dividend to 20 yen per share, up from 10 yen per share in fiscal 2010.
Beyond fiscal 2011 and over the midterm plan, our dividend policy will target a minimum payout ratio of 25% of net income.

CSR report publication
As a corporate citizen, Nissan fulfills its responsibility to help realize a sustainable society through educational, environmental and humanitarian relief efforts. For example:

  • We taught 21,000 Japanese children about the environment and science of making things through our Waku-waku Design Studio, Waku-waku Eco School and Monozukuri Caravan... and this year we sent a Caravan to Fukushima Prefecture when the students' visit to our Iwaki Plant had to be cancelled due to the earthquake,.
  • We are beginning our 28th year of distributing tens of thousands of books to libraries throughout Japan through the Nissan Children's Storybook and Picture Book Grand Prix.
  • Through Habitat for Humanity, teams of our employees are building homes for people in India, Australia, the United States and, soon, in Indonesia and Thailand.
  • And our humanitarian efforts extend around the world, as we respond to those affected by natural disasters such as floods or earthquakes.

Since the March 11 earthquake, Nissan has donated more than 400 million yen in cash and in-kind contributions to support relief efforts in Japan, and we are now in the process of donating an additional 100 million yen. We supplied 50 Nissan Patrol four-wheel-drive vehicles and 65 Nissan LEAFs for use in the stricken areas - and our 100% electric cars were gratefully received since there was a serious gasoline shortage right after the quake.
Nissan is working to make a better world. You can see more of our actions in our annual Sustainability Report that is being released online today.

President's Award
The employees of Nissan are the power inside the company. At last year's shareholders' meeting, we introduced some employees who made outstanding contributions to Nissan's performance during the fiscal year. We'd like to do that again this year, recognizing recipients of the Global Nissan President's Awards... and I invite them to join me on stage at this time.
The Award to Employees recognizes all the effort it took to launch the world's first mass-marketed, affordable electric car, Nissan LEAF. These individuals moved the project quickly from research to mass production... acquired hundreds of patents... forged global partnerships to develop incentives and infrastructure... and enhanced the Nissan brand from the very start. The many awards that have already been won by Nissan LEAF celebrate the car as well as the hard work of these employees.

I will ask Yoshiyuki Tanaka, who works in the Zero Emission Business Unit, to speak on behalf of his team about that effort.

Carlos Ghosn:
Ladies and gentlemen, our dear shareholders, thank you for your trust in our ability to manage a company that has had a remarkable journey since 1999.
On behalf of Nissan's entire Executive Committee, I pledge our commitment to work hard to build the future you expect for Nissan in the years to come. In turn, we ask for your continuing support as Nissan continues to evolve as a leading global automaker and a responsible promoter of sustainable mobility.

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