Nissan Is Poised to Shift Output to Dollar-Linked Economies

Currency concerns continue to prevail in manufacturing firms worldwide. Big Japanese companies are becoming more like the U.S. platform companies. So do big Korean firms.

From CNBC:

Nissan is planning to shift the balance of its production and support functions towards dollar-linked economies, including the U.S. and China, to protect itself against currency volatility, the Japanese carmaker’s chief executive has said.

Carlos Ghosn, CEO of Nissan and its French partner Renault, told the Financial Times that they wanted to correct a “big imbalance” in costs and revenues caused by producing cars in Japan to sell in the U.S. and dollar-linked economies in Asia.

“What we [want] to do is shift more of our cost from a yen base to a dollar base,” he said. That would not mean closing down facilities in Japan, he added, but that the company could not expand there.

His remarks may fuel concerns among other countries, and Japan in particular, about the effects of loose U.S. monetary policy and China’s currency link to the dollar.

The dollar has lost 10 percent of its value against the yen this year.

Mr Ghosn said exchange rate volatility of any kind was damaging to business, because it militated against long-term strategy. “The only way you can protect yourself is by making sure your currency footprint is balanced. If there is any imbalance, it should be small.”

http://www.cnbc.com/id/40305508/Nissan_to_Shift_Output_to_Dollar_Economies