Nissan Motor said its low-end Datsun business in markets including India and Indonesia will generate operating margins of as high as 7 % as it shares the parent’s development facilities and distribution network.

Datsun’s operating profit will probably average between 4 and 7 % of revenue through the life cycle of the brand, Vincent Cobee, head of Datsun, said in an interview this week at Nissan’s headquarters in Yokohama, Japan.

The low-end brand may help determine the direction of Nissan’s overall earnings, with the carmaker counting on Datsun to account for one third to half of the group’s total deliveries in emerging markets where it will be introduced. Revived after more than three decades, Datsun will focus on lower priced cars, while Nissan’s namesake brand goes after mainstream motorists and Infiniti caters to the high-end market.

Nissan Chief Executive Officer Carlos Ghosn has set a target to raise the company’s overall operating margin to 8 % by March 2017. The margin shrank to 5.4 % in the year ended March 2013 from 5.8 % in the previous 12 months.

Total deliveries in India, Indonesia and Russia will probably reach 400,000 units in three years, Cobee said. He declined to give a projection for sales in South Africa, the fourth market Datsun will be introduced.

Nissan has unveiled two models, a hatchback named Go in India and a three-row wagon called Go+ in Indonesia last year. The automaker will offer seven Datsun models in three years in four markets, disclosed Cobee.

Via Bloomberg


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