Published on May 15th, 2020 | by Subhash Nair0
History Repeats Itself, Datsun will be No More… Again!
It looks Nissan will be pulling the plug on the Datsun brand for a 2nd time. Bloomberg reports say they’ll be doing this to save themselves some US$2.8 billion in annual costs. It’s all part of a 3-year turn around plan that the company will reveal soon.
The writing has been on the wall for the recently revived brand. Not only have sales declined since 2018, but just in November 2019, it was announced that Datsun would be closing their Indonesian plant. As part of this plan, Nissan will also be closing an additional plant, but it has yet to be named.
Many older Malaysians will be familiar with the Datsun brand. Before the 1980s, Nissan sold most of its export market vehicles under the Datsun brand until 1985.
What most Malaysians probably don’t know is that that brand came back! In 2013, under Carlos Ghosn’s leadership, the Datsun brand was reintroduced as a budget-focused passenger car sub-brand for emerging and developing markets. This 2013 reimagining of the brand made its debut in India, with the Datsun Go being built in a Renault-Nissan plant in Chennai.
By 2014, the Datsun brand had been introduced to Indonesia, Russia, Nepal and South Africa. Kazakhstan, Sri Lanka, Belarus and Lebanon later received Datsun-branded cars as well.
These new Datsun cars were essentially made to be more suited to markets with more lax restrictions on safety, emissions and where the population had different buying considerations than in developing markets.
Instead of making global cars that could work in the poorest and richest nations like Ford does with most of their products, or keeping older versions cheapest, models in developing markets like Volkswagen does with the Polo, Nissan’s strategy was to create a separate brand. Think about it this way – in Europe, the United States, Japan, South Korea, China and a few other markets, passenger cars are highly regulated. There are strict safety and emissions standards to adhere to.
This makes cars more expensive and more complex. In emerging markets, rules are more lax. Families are much larger and buying power may not be quite as strong.
Other brands have unsuccessfully tried to spin off budget brands before that eventually failed as well. The youth-focused Scion comes to mind. It’s not like creating more premium brand spin off work all the time either. Mazda’s Eunos never quite took off in the 1990s either.