Nissan’s Mann

To listen to the popular media you would think that manufacturing in the UK, particularly car manufacturing, was dead. Nothing could be further from the truth. And if Trevor Mann, senior vice president of manufacturing, purchasing and supply chain management for Nissan Europe, has his way, then it will go from strength to strength.
Mann joined Nissan Sunderland as a team leader in the production department in 1985 when the plant was still under construction. So he has lived and breathed Nissan for most of his working life, and has been a key part of its incredible success story.
The Sunderland plant has successfully competed for the right to manufacture a whole succession of new models since it began production in 1985, leading to the point last month when it announced it was moving from a two shift to a three shift pattern, in order to meet demand for its enormously successful Qashqai – also a British success story, designed at the Nissan Design Centre in London.
I asked Mann what he believed was the secret of the Sunderland plant’s success, and why the Japanese company continued to invest so heavily in it. “As with any manufacturing,” he said, “it’s all about remaining competitive. And if you look a the Sunderland plant over the years it has focused
on being as competitive as it can be. Even from the inception back in 1985, the benchmark was Japanese car manufacturing as opposed to UK or European car manufacturing. The rest is down to the motivation of the workforce, the ability of the management team at Sunderland, and what we call the Nissan Production Way (NPW) – a similar system to the Toyota Production System.”
Continually increasing competitiveness is at the top of Mann’s list of priorities. Nissan, like most global automotive manufacturers, has a competitive tendering process for deciding where new models are to be manufactured. “Securing a new model is very important, but it’s only as good as the day you get it. Then you’re on countdown, basically, and you’re looking for your next opportunity.”
Sunderland’s management team is obviously very much on the case. The global group has been operating a series of business plans: the Nissan Revival plan, followed by the Nissan 180, and the Nissan Value Up plan (NVU) which will finish at the end of the year. But satisfying the NVU, according to Mann, was not enough for the Sunderland management team. It reviewed Sunderland’s position in the plan, “although we had set up agreed global targets, objectives and tasks within the period, the local management decided that it wasn’t enough, and further stretched that plan. We’re well on the way to achieving that by the end of the year.”
The driver, essentially, was to remain the group’s first choice in Europe for high quality, cost effective manufacturing. “The world is changing, and changing very quickly,” Mann said. “It’s getting smaller, more easily accessible, and you’ve got to continually reflect your position against the latest benchmark.”
Part of his strategy for improving cost effectiveness is linked to supporting and improving the effectiveness of his supply chain. “It’s no good having a competitive OEM and poor suppliers, because it’s the total delivered cost that matters when you’re deciding where to build a car. So we have been working very closely with our satellite suppliers. And together we need to make sure they are competitive. We’ve shifted our business model and integrated many of these suppliers onto our site adjacent to the point of fit in production.”
He described the arrangement as a fishbone line. In essence, the Nissan assembly is the spine and the suppliers are the bones feeding in to it. But the support side of the equation is also very real. “We support them in terms of training, we support them in terms of cost reduction. And those goes hand in hand. They can’t survive without us, and neither can we survive without them. That’s why we have to work together.”
Nissan, true to its ideals of developing best practice, is playing something of a thought leadership role in automotive manufacturing, and is pushing the boundaries of car making. It has developed a flexible manufacturing system whereby it can produce a number of completely different car models on a single production and assembly line. Using what it calls the Nissan Integrated Manufacturing System (NIMS), it is attempting to make all its lines extremely flexible. “Ultimately our body assembly can take up to eight body styles.
And I mean on a one-for-one basis, not on a batch basis,” he explained.
The concept of flexibility has a number of meanings and effects, according to Mann. “Flexible also means we’ve shortened the overall length of the production process, which goes right back into the fishbone process. So typically the lead time from setting up a body and coming offline would be less than one day. So where we’re striving to make cars on a build to order basis, it allows us to shorten the lead time of delivery to the customer.”
This flexibility also means Nissan can easily move models from one line to another, and can introduce a new model very quickly. “Historically most manufacturers had dedicated lines that were purpose built to a specific model, which meant that change over from one model to another was a considerable engineering feat. What we have now is much more flexible, and that is very important for a multi model plant with varying demands for different models.” And this has been tested to the full during this financial year.
The overwhelming success of the Qashqai model created a rather delicious problem for Nissan. It had more customers and orders than it had capacity to fulfil. “We tried many things. We increased capacity within the current shift arrangements. We then moved Note from the Qashqai line – our number one line – and put it on the number two line alongside Micra.”
But none of these things were sufficient to bring the order bank down, “and we needed to do something about that. We were at risk of losing customers.” In order to maintain supply, Nissan has chosen to increase from a two shift to a three shift pattern, a decision that, as a committed long term employer, it will not have taken lightly.
Meanwhile, introducing a new model has been speeded up considerably. The Note, for example, was ramped up to full production in just three weeks in 2006. Part of this speed was due to the flexibility provided by the NISM, but part was down to the engineering and technology that went into the design of the vehicle, and then moving it into production. “As with all manufacturers we’ve been moving towards developing cars in the digital world, [undertaking] very early trials with high off-tooled parts, and confirming them
much earlier than we could on previous models where we had to make physical tools. The other elements are how this is productionised. As part of the NPW we focus on identifying as many concerns as early as possible, and applying countermeasures as soon as possible. At Sunderland, we used to do this in six weeks, now it’s about three weeks. It’s not uncommon for some European manufacturers to take 12 or 20 weeks to do the same job.”
I was particularly interested in the concept of making to order as, in spite of the efficiency of modern car making, many manufacturers are still making to stock for the dealerships rather than making to order for the end customer.
For Nissan, Mann explained, this depends on the product. “Most products are a mixture, and the ratios vary from product to product. For example the build-for-customer ratio is relatively low on the Micra. But because the Qashqai is in demand, the actual customer order ration is well above 90 per cent.”
So how, I wondered, did Mann view the future of the UK automotive industry. He had no doubt about what had to be done. “It will not be viable if you sit on your laurels and think the world owes you a favour.” However, he saw two facts in favour of UK manufacturing. “The UK is a large market in itself. And the UK, as an island, can enjoy quite a good logistics route, both inbound and outbound. One of the jewels in the crown at Sunderland is that we’re only one or two miles from the deep sea port of Tyne, which allows us to import parts and ship cars out cheaply and effectively. The cheapest way to shift anything these days is by sea. We can ship very effectively into all of northern Europe and Russia, the Baltics, Netherlands, Germany and down to Spain.”
This is clearly a benefit for Nissan with its proximity to the sea port. But considering the congestion on the roads, it can’t be of much benefit to manufacturers in say Coventry or Birmingham. “They would have a slight, arguable, disadvantage,” he admitted.
Meanwhile, many emerging nations are becoming strong competitors, and also cost effective suppliers to the UK OEMs, and he did not see that changing. “India is quite an exciting proposition for us and for many other suppliers and OEMs. And also north Africa seems quite reasonable.”
Last year Nissan and Renault announced plans to build a lowcost manufacturing plant in the port of Tangier in Morocco, and it is currently exploring the viability of the local supply base. However, he perceives this as an opportunity rather than a threat for western-based suppliers. His advice for them is: “Don’t rely on your current business model, it needs to be continuously evaluated and updated, because the world is changing extremely quickly. I think there are opportunities to move their business to follow where the OEMs are going, and also to get good competitive support from these countries for their existing operations.” Finally, Nissan chief executive Carlos Ghosn has often been quoted to have said that the UK needs to join the euro if it is to retain its manufacturing position. What were Mann’s thoughts on this?
“Firstly, I don’t think he actually said that, although he was often quoted as saying that. What he actually said was that when he runs a business he wants to run it on stability. He doesn’t want to run it on luck, ie with currency windfalls or their opposite. What we have done in Nissan is to take a very pragmatic approach. We have tried to balance our currency footprint in terms of revenue and costs. We source a number of parts from Europe in euros and some from the UK in euros.” But the market is changing rapidly, and Nissan is evolving with it.