Nissan Brexit Report

This report provides a comprehensive analysis of Nissan's position in the UK market, particularly in light of Brexit. It begins with an introduction to Nissan's UK operations, including its history and location in Sunderland. The report then delves into a detailed analysis of Nissan's current market strategy and positioning, considering various factors such as political, economic, social, technological, legal, and environmental influences (PESTLE analysis). Porter's Five Forces framework is applied to assess the competitive landscape, examining threats from new entrants, substitutes, supplier and buyer power, and competitive rivalry. The report further explores Nissan's competitive advantages, differentiating between tangible and intangible resources and utilizing the VRIO framework (Value, Rarity, Imitability, Organization) to assess the sustainability of these advantages. Finally, the report includes a comprehensive list of references.

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Contents
Introduction to Nissan's in the United Kingdom..........................................................................................3
Analysis of current market strategy and positioning of Nissan....................................................................5
PESTLE Analysis impacting the strategy of Nissan....................................................................................7
Economic Factors....................................................................................................................................7
Political Factors.......................................................................................................................................8
Technological Factors..............................................................................................................................8
Social Factors..........................................................................................................................................8
Legal Factors...........................................................................................................................................9
Environmental Factors.............................................................................................................................9
Porter’s 5 Force Theory.............................................................................................................................10
Threats of New Entrants........................................................................................................................10
Threats of Substitutes............................................................................................................................11
Bargaining Power of Suppliers..............................................................................................................11
Bargaining Power of Buyers..................................................................................................................11
Competitive Rivalry..............................................................................................................................11
Competitive Advantage of Nissan.............................................................................................................12
Diverse Resources.....................................................................................................................................13
Immobile Resources..............................................................................................................................13
VRIO: Value Rarity Imitability Organization........................................................................................14
References.................................................................................................................................................15
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Introduction to Nissan's in the United Kingdom
NMUK Ltd. or Nissan Motor Manufacturing Limited (UK) is a car manufacturing company
which is located in Sunderland, England as well as in Tyne and Wear. The organization is
operated and owned by the European division of Japanese car manufacturer Nissan. The
company became active from 1986. The organization was built upon the former RAF Usworth.
Moreover, Nissan provides a unique as well as innovative automotive services and products
which are concerned with the delivery of superior measurable values to all the stakeholders in
alliance with Renault. The stakeholders of Nissan consists of customers, employees, dealers,
shareholders, suppliers and the communities where the organization operates and work (Nissan
300ZX, model Z31 series, 2002). The company is back at full strength and focused on
accomplishing a sustainable long-term growth in future. The members of Nissan are dedicated to
fulfilling the responsibilities as a citizen of the global community while maintaining the
maximum levels of business performance. Nissan Motor Manufacturing UK is situated in
Sunderland, Tyne, and Wear, in North East England. Moreover, it is based on the previous
Usworth Aerodrome. A1231 and A19 Sunderland Highway trunk streets (Nissan Maxima model
J30 series, 2000). The processing plant is contiguous the UK Nissan Distribution Center or NDS,
and it has various on location providers. The finished NMUK site joins preservation zones, for
example, lakes, lakes, and forest, and at present has ten area wind turbines, delivering up to ten
percent of the vitality required for the plant. Besides, the site is found five miles from Port of
Tyne where universal dissemination is based.
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A figure representing Nissan Juke
Source: http://zombdrive.com/images/2015-nissan-juke-2.jpg
Under the leadership of Takashi Ishihara, the government signed an agreement for building a car
manufacturing industry in the United Kingdom in February 1984. Takashi Ishihara was the
President of Nissan from 1977 to 1985 (Nissan Jidosha, 2016). In December 1985, McAlpine
provided over the completed modern office attempting to Nissan for the foundation of the
contraption and accumulating plant parts, before timetable. In July 1986, phase one of the plant
improvement was made. It involves a body, paint and last mechanical creation framework. The
essential Bluebird has conveyed not long after and is on display at the Sunderland Museum and
Winter Gardens. In September 1986, the official opening of the plant by then Prime Minister
Margaret Thatcher and Nissan President Yutaka Kume happened. Recently, during the year
2008, the falling sales of the Primera has led to its demise with the Qashqai becoming the hero
model for the industry (Cass, 2002). The Primera had the distinction of being the first model
built at Nissan Motor Manufacturing Limited to be exported to the Japanese market. One of the
company's more debatable solicitations in the midst of the examinations was that the plant is
single-union. It was uncommon in UK industry. During April 1985, a comprehension was come
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to with the Amalgamated Engineering Union (AEU). From the research, it has been argued that
the plant workforce is weakly addressed. Nissan battles that as needs are of the single-union
comprehension, its workforce is significantly more versatile than at various plants, and it centers
to the way that not a lone minute has been lost to a mechanical verbal confrontation at the
modern office (Nissan makes major investment in 3D scanning equipment, 2002).
Analysis of current market strategy and positioning of Nissan
Currently, Nissan has a stronghold in many Asian countries, and after the year 1999 pact with
Renault, the stature of the company has raised in other parts of the world as well (Jackson, 2007).
Moreover, both these companies, Nissan and Renault aimed to open their car showrooms in
various regions of the world and they did that. In India, Nissan seeks to launch eight new
vehicles by the year 2021. The company also seeks to increase its market share in the car market
of India from the current two percent to five percent by 2021 with the utilization of new product
launch under the brands of Nissan and Datsun.
Here, current market strategy and positioning of Nissan has been discussed. The current
positions are based on the political, economic, social, technological and environmental factors.
 The political factors highlight the probable laws and regulations of the government,
restrictions and security measures and these can apply to the industries. Since its outburst,
rules, and legislation had affected the automobile industry (Nissan Leaf hits the road,
2011). In the United Kingdom, these rules are evolved around the environmental norms
that were to be fulfilled by any car industry. Therefore, during manufacturing of
automobiles, the car manufacturers had to take care of the issues regarding the
environment. The government foreign policies and taxes are important for the auto
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industry. Production of high mileage cars along with the increase in vehicle promotion
and sales are the result of the introduction of new schemes in the United States of
America.
 Exchange rates, global economic growth, and the business configurations are the
economic factors which prevail in the industry. Besides that, there was an excess capacity
of the cars produced which give rise to a high amount of revenue in marketing as well as
new product designs. In United Kingdom's automobile industry market, there was a lot of
income withheld even though the demand was less than the supply (Minchin, 2016).
 Socially, the factors which impact the car industry in the UK are the changes in
demographics and cultures. These two factors are quite different from the change in
buying pattern and capacity of the customers. Customers may change their preference
during buying time. The changes in predictions depend upon factors such as fuel
efficiency or low emission cars. Due to recessions in mature markets, changes in buying
pattern of the customers are observed in the UK automobile market.
 The technology of United Kingdom is developing more from the past. Consequently,
companies such as Nissan is developing new and innovative technologies for making
cars more better than others, more economical, more ecological, more technology
advanced and remaining affordable to each and every customer. In UK automobile
industry, utilization of sophisticated and new designs overcome the decreased margins in
the industry.
 Due to the introduction of new and innovative technology, environmental issues are seen
such as environmental pollution. Therefore, Environmental Protection Act 1990 helps in
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improving the control of contamination from certain industrial and other processes
(Dunne, 2006).
PESTLE Analysis impacting the strategy of Nissan
Source:
http://1.bp.blogspot.com/-IBhw9pM1aJU/VSF9DjlAqPI/AAAAAAAAJBw/m0ANrWcKuNo/
s1600/pestel%2Banalysis.png
Economic Factors
Economic factors affect the purchasing power of potential customers and the organization’s cost
of capital. Delineations are, for instance, inflammation rate, financial advancement, exchange
rates and others. Besides, the association of Nissan with Renault set up as the Renault-Nissan
Purchasing Organization (RNPO) in the year 2001. It was key ways to deal with reduce cost by
merging both their resources for being more gainful in the company (Peterson, 2009). Renault
and Nissan starting at now hold sixty percent shares some part and rough materials suppliers. As
business impacts and the enthusiasm for work grows, wages will rise. In a period of money
related improvement, the client asks for in the auto industry will climb as occupations are made,
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and nonessential compensations grow. Besides, input factors like capital and unrefined materials
required for vehicle creation will also watch higher demand and equally higher expenses.
Political Factors
The political factors of Nissan Motor Company or NMUK are cars of the company need to meet
certain standards to have the ability to enter certain countries to be sold. Moreover, it is a direct
result of the way that particular states do not allow first class vehicle. Suppose taking an
example, Nissan Skyline models to enter the country since the driver may manhandle the vehicle
for unlawful street dashing. There is additionally prosperity standards that should be attempted
before the Nissan car is legitimately make to the market (Toma and Marinescu, 2013). Other
than a powerful vehicle, Nissan needs to meet the Emission Standards whereby it is a need that
set a particular limit of the defilement to make by an auto that is released to the earth.
Technological Factors
Nissan finished distinctive crash test from the run of the mill driving incident to honest to
goodness and fatal setbacks to be analyzed and to give determined overhauls onto Nissan's
vehicle. To wrap things up, technological factors can cut down preventions of the section,
diminish minimum capable era levels and affect outsourcing decisions. Nissan makes these
qualities to outfit their customers with 'place stock in driving enjoyment. The organization has a
whole deal target to retreating CO2 help the average crisis, for instance, an unnatural climate
change. Nissan has four scopes of technological goals which fuse the earth, prosperity, efficient
execution and life on board.
Social Factors
Social factors are concerned with the cultural and demographic features. These factors impact the
customer needs and the measure of potential markets. Cases are prosperity insight, age allotment,
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and complement on security, calling mindsets and others. The company is building and
collecting automobiles to meet an extensive variety of people's demand. Differing people would
incline toward different sorts of cars depending upon the customer itself.
Legal Factors
Legal factors consolidate prosperity and security, meet open entryways, advancing standards,
client rights and laws, naming and success of products (Mullineux, Southworth and Davies,
2000). Distinctly associations need to grasp what is and what is not honest to goodness
remembering the actual objective to trade successfully. If an organization, for instance, Nissan
deals thoroughly this transforms into a particularly problematic domain to get OK country has its
game plan of principles and controls.
Environmental Factors
These factors have quite recently genuinely gone to the front line in the latest fifteen years or
close. They have ended up being primary given the extending lack of rough materials, pollution
targets, cooperating as a healthy and sustainable association, carbon impression targets set by
governments. Moreover, these areas of late a segment of the issues sponsors are facing inside
this segment. A continually expanding number of purchasers are asking for that the things they
buy are sourced ethically, and if possible from a sustainable source (Nissan Pintara model U12
series, 2001).
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Porter’s 5 Force Theory
Source: https://www.google.co.in/url?
sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0a
hUKEwi3ztbvkIXSAhXIRI8KHcaqAxcQjRwIBw&url=http%3A%2F
%2Fwww.notesdesk.com%2Fnotes%2Fstrategy%2Fporters-five-forces-
model-porters-model
%2F&bvm=bv.146496531,d.c2I&psig=AFQjCNFppAFfozeERYPm6vOI
ND1FGESgig&ust=1486802443777110
Threats of New Entrants
In car industry, the threats of new entrants is very high. The growing economy as well as the
increasing buying power of the customer has made each and every automobile player to grab the
opportunity in small car segments. There are some new car models launching in the international
market and it is a threat to Nissan. The models are Honda City Facelift, Hyundai EON New,
Toyota Prius and so on.
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Threats of Substitutes
From a client viewpoint, the option vehicle for a Nissan will be either buy of another auto in
little auto section or going for second-hand vehicle of same Nissan's cost. The rational thinking
of the customer in this buying procedure will be based on three cost such as cost of buying the
vehicle, maintenance cost as well as resale value of the vehicle(Nissan Pintara model U12 series,
2001).
Bargaining Power of Suppliers
The providers for this industry incorporate the supply of crude materials like steel and a
considerable measure of segments are included in the Value chain prepare. Besides that, steel
which is a remarkable crude material for this industry is continually expanding in cost because of
abundance request and accessibility.
Bargaining Power of Buyers
The bargaining power doesn't have genuine effect in current circumstance as Nano doesn't have
arrange choice in its 600CC thing characterization (Huang et al., 2015). Regardless, there is
availability of substitutes for buyers to the extent vehicle utility. Hence the managing power of
buyers is medium.
Competitive Rivalry
Internationally, the craze for cars are growing and people are incoming millions of dollars and
buying cars. Therefore, Nissan needs to make such cars which will be unique from others. In this
way, they can achieve competitive advantage. Resources, strategies and plans are required by the
organization accomplish their objectives of the competition market.
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Competitive Advantage of Nissan
Source:
http://websitedesigncentre.com.au/wp-content/uploads/2014/05/competitive-
advantage.jpg?x86760
Definition of Competitive Advantage: A concept of the business that described the attributes of
allowing an organization to outperform its competitors is known as the competitive advantage.
The particular characteristics include access to natural resources like low-cost power source,
geographic location, skilled labor and high entry barriers.
Tangible resources vs. Intangible resources: The tangible support of Nissan is concerned with
an opportunity for earning economic advantages with the aid of distribution of goods or
production. Besides that, tangible resources consist of equipment, vehicles and so on. On the
other hand, intangible resources lack physical form. Intangible resources include patents for
hand-held mobile radiotelephone technologies or brand names of the company (Huang et al.,
2015).
Competitive advantage can also be gained by accessing to new and innovative technology. Here,
Nissan accesses to new and innovative technology. Therefore, the organization can achieve
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