Nissan Annual Report 2004 29
NFS and Nissan Motor Acceptance Corporation join with our counterparts from Renault and RCI
Banque once a year for the Global Finance Synergy Meeting. We exchange ideas and best
practices at this session, which has proved beneficial for both companies. The concept of offering
fleet services, for example, originated with RCI Banque, which has been doing it in Europe.
Our performance is measured not only by volume, but also by return on assets. We will
continue to increase revenues, reduce costs through process integration, and enhance the
functions of our centralized call center and IT activities. We aim to diversify our sources of income
through other business activities, such as insurance and maintenance, while improving the
customer experience. We want to be the best sales finance company in Japan.”
WHO WE ARE
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NORTH AMERICA
“At Nissan Motor Acceptance Corporation, our
mission is to maximize the value of Nissan by
providing competitive financial products and
exceptional customer service. We are continually
striving to support our customers by being an
integral component of the Nissan North America
sales and marketing plan, being the first choice
of dealership financing, and by being the
preferred lender to Nissan and Infiniti retail and
lease customers. Since we mainly contribute to
the Nissan global profit objective when a car is
sold, we work closely with Nissan North America
to support this sales process. Our overall market
penetration—one of our key performance
indicators, or KPI—was strong in fiscal 2004 at
49.7 percent for retail and lease combined. That
means nearly half of all retail Nissan and Infiniti
vehicles sold in the U.S. are financed through
Infiniti Financial Services or NMAC.
Performance during NISSAN 180 was very
strong as well, with penetration and profit levels
higher than our budget objectives for all three
years. This was partly due to the higher volume,
but also as a result of our tight controls we kept
on loss ratios, which we accomplished through
good buying practices and closely managing our
portfolio. In fact, roughly 75 percent of our
portfolio is categorized as Tier 1 and Tier 2,
based on the FICO or Fair Isaac & Company
score. As a result, in fiscal 2004 our retail loss
ratio was 1.1 percent, and our lease loss ratio
was 0.4 percent. Both ratios have improved
since the previous year. We also grew our dealer
inventory-financing portfolio. At the beginning of
2003, we had 359 dealerships in our inventory
floor plan count. By the end of fiscal 2004, that
had increased to 595. It’s a profitable business,
and one that sets the stage for a strong overall
relationship with the dealer. 
On the cost side of our business, we have
effectively managed our operating expenses,
which represent another KPI. From the beginning
of fiscal 2003 to the end of fiscal 2004 we
improved our operating efficiency metric by over
20 percent, and continue to be among the
industry leaders in cost structure.
Regarding our funding strategy,
approximately fifty percent of funding comes
from asset-backed securitization, making that
our largest funding source. However, that
proportion has been declining because we
began using a variety of other funding sources,
including commercial paper and bonds, after
our ratings improvement. As a result, our
dependence on Nissan North America for
funding via inter-company loans will be reduced
in the future.
Under NISSAN Value-Up, we will work closely
with Nissan Motor Co., Ltd. and Nissan North
America to provide additional sales-financing
capabilities in new global markets, which can be
a key to increasing sales volume. To achieve the
same kind of success we have achieved in our
new Mexican sales-financing efforts under the
NISSAN 180 plan, we will support the global
Infiniti expansion and other geographic growth,
including developing financial products for the
light commercial vehicle market.”
STEVEN R. LAMBERT
President and CEO