HK to be new HQ for luxury carmaker Infiniti
Infiniti, the luxury division of Japan's second-largest carmaker, Nissan, is moving its global head office to Hong Kong, the first time the city has been selected for the headquarters of a car manufacturer.
Carmakers usually set up their head offices in their country of origin or near to their biggest markets, but Hong Kong, which sells less than 4,000 new cars a month, was chosen for its proximity to the fast-expanding Asian market and also its high percentage of luxury car sales.
'China is the largest prospect for us, and Hong Kong is not only a door open to China, but the rest of Asia,' said Carlos Ghosn, chief executive for both Nissan and its long-term partner Renault in an interview ahead of the new office's opening today.
'There's no other market in the world [like Hong Kong] where 50 per cent of its car sales are luxurious ones.' Nissan, which has nurtured the Infiniti brand since it was established in 1999, has high hopes for it.
'It is difficult for any brand to prosper in front of the strength of Nissan,' Ghosn said. 'So it is important for us to make it distinct from Nissan, and the best way is to get it out of Tokyo.'
Infiniti sold only 150,000 units last year worldwide, just three per cent of the 4.85 million sales by Nissan group. But by moving its production base to China and the head office to Hong Kong, Ghosn hopes Infiniti can sell 500,000 cars globally by 2016.
Infiniti, which will announce the location of its new mainland production base in the coming week, will continue to explore new plant sites outside Japan.
A strong yen in the past few years has put the brand in a very disadvantageous position compared to German rivals which have production lines in various parts of the world.
Despite a slowing mainland car market, the largest in the world, Infiniti expected to triple its sales in the country from a projected 27,000 units this year to about 81,000 in 2016. Its annual sales have jumped more than five times over the past three years to 19,000 in 2011.
'I have worked in China since 2002 and not one year while I was there has there been no growth],' said Ghosn. 'We had the banking bubble, real estate crash and the slowdown, but after this, you always discover, oh my god, China is growing more than we thought.'
Despite the optimism, Ghosn did not set a strict time frame for its targeted sales on the mainland, as he did not want to join the price-cutting game that has seen dealers for Audi and BMW fight to exceed or maintain their market shares by offering big discounts.
'Infiniti made up not even 3 per cent of our sales and an even smaller percentage of profits, so we can afford more time to turn it into a big engine for our growth,' he said.
Planning to hire 100 staff for the brand's new office at Central's Citibank tower, Infiniti will work with its distributor and dealer Dah Chong Hong in the coming months on a brand-building campaign targeted at Asian markets including China, Thailand, India and Indonesia.