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Nissan Hit Hard by Move to South

The carmaker will have to replace 750 of the 1,300 employees at the Gardena headquarters that it is vacating.

April 26, 2006|John O'Dell | By John O'Dell

Nissan Motor Co. said Tuesday that about 42% of its 1,300-employee headquarters staff would make the move when the automaker relocates its North American headquarters from Gardena to Nashville in July.

The relocation figure is less than the 50% goal that Nissan Chief Executive Carlos Ghosn had hoped to achieve but is considerably higher than the 35% to 39% figure that relocation specialists said was typical in such long-distance corporate moves.

Nissan, the third-largest of the Japanese automakers manufacturing vehicles in the U.S., now faces the task of quickly filling the remaining 750 clerical, financial and legal, corporate, product planning, parts, service, personnel and other positions.

Nissan said it had hired or made offers to more than 200 replacement workers. The automaker has received more than 27,000 resumes since November, when it announced its headquarters move, said James Morton, Nissan North America's senior vice president for finance and administration.

Ghosn said this month that he expected the North American operation to suffer some short-term disruption because of the loss of veteran professional employees who have opted not to move to Tennessee.

But Morton said Tuesday that he foresaw only a few "rough spots" during the summer when the move occurs.

Although he declined to say when he expected to have a full headquarters complement again, Morton said Nissan's U.S. operations would not be severely affected: "We are and have been geared up and our recruiting effort is going very well. We will get the job done."

The company is relocating its sales, marketing and planning operations to the Nashville area to be closer to its Tennessee-based U.S. manufacturing operation and to benefit from economies of scale.

Nissan's manufacturing headquarters and assembly plant in Smyrna, Tenn., is about 45 miles east of the company's new headquarters site in Franklin. Both towns are south of Nashville. Nissan already has more than 6,500 employees in Smyrna, its largest U.S. assembly plant.

The company's Gardena headquarters is for sale, but Nissan has not said whether there have been any offers.

Until a new headquarters facility is completed in Franklin, Nissan will temporarily operate from a high-rise it has rented from BellSouth Corp. in downtown Nashville.

The move will begin in June.

Separately, Tokyo-based Nissan Motor Co. reported Tuesday a 9.4% rise in profit for the latest quarter and posted a record annual profit for the sixth consecutive year. Net profit at Nissan totaled 152.4 billion yen ($1.3 billion) in the January-to-March quarter, up from 139.3 billion yen in the same period last year. Sales rose 6.4% to 2.64 trillion yen ($23 billion).

Nissan -- 44% of which is owned by Renault -- racked up record profit for the fiscal year ended March 31, at 518.1 billion yen ($4.5 billion), up 1.1% from 512 billion yen in fiscal 2004, outpacing the 517-billion-yen profit Nissan had forecast. Sales for the fiscal year totaled 9.43 trillion yen ($81.8 billion), up 9.9% from 8.58 trillion yen.

The company also said it would build a vehicle assembly plant in Russia as part of its global expansion, and forecast a slight profit rise on increased revenue for the current fiscal year.

Ghosn said Nissan would invest $200 million in the vehicle assembly plant in St. Petersburg, Russia, which would begin production in 2009. It will have an annual capacity of up to 50,000 units and will employ 750 people. "Russia is an important part of our global growth strategy," he said.

Last year, the company sold more than 46,000 vehicles in Russia -- a growing market for autos -- up from 28,000 in 2004. The plan still needs Russian government approval.

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Times wire services were used in compiling this report.

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