TECHNOLOGY Pursuing Value Through  Technological Excellence MITSUHIKO YAMASHITA Executive Vice President “I have two prime objectives. The first is to realize our corporate vision,  ‘ Enriching people’s lives,’ from an engineering standpoint. The second is to create a future vision for people working in R&D. Research and development is all about providing practical value to the customer via technological excellence, which in turn creates value for our shareholders. Nissan has made a major commitment to technological excellence so that we can accomplish these objectives.  Nissan’s investment in R&D has been rising. In fiscal 2004 we devoted approximately ¥400 billion to it, equivalent to 4.6 percent of our turnover. We estimate that our financial commitment to R&D will continue to range between 4.5 and 5 percent. R&D investments take a lot of time to pay off, of course, so it’s difficult to evaluate our evolution  over the short term. Given our expanded output, however,  I believe that we are headed in the right direction.  For example, the number of patents we have generated is growing quickly, exceeding 4,000 in fiscal 2003—more than twice the fiscal 1999 figure. And the number of research papers we present at societies such as The Japan Society of Mechanical Engineers rose dramatically in fiscal 2004. These are direct results of our commitment to research. We are also generating more new technologies related to safety and the environment, such as the Around View Monitor and the lane-keeping system. Our technology base is in Japan, where we have some ten thousand people involved in R&D, but we also have two major centers in North America and Europe, and smaller operations in Taiwan, China, Thailand, South Africa and Brazil. In the past, these entities were mostly standalone operations, but today there are many more joint projects Our R&D infrastructure, however, is still in need of expansion. We’ve therefore begun building new facilities at the Nissan Technical Center, NTC, and at the Nissan Advanced Technical Center, NATC, both of which are in Japan. These additions represent a major investment, and show Nissan’s dedication to maintaining and enhancing its technological skills.  The number of new products we have brought to market over the past three years is equally significant— more than thirty new vehicles. That’s an impressive engineering achievement, and the reason you are seeing so many new Nissan models on the road. We have succeeded in shortening our production pipeline, too, using a new vehicle development process called V3P that our engineers devised over the past three years. V3P, which stands for Value-up innovation of Product, Process, and Program, has helped us cut our development time almost in half, from 20 months to just 10.5 months. I believe this makes Nissan the world benchmark in development. That improvement is having a major effect on the flexibility and execution of R&D at Nissan, and will ultimately boost the company’s profitability.  Research and Development OUR WORK Nissan Annual Report 2004 44 Shock-absorbing body, to reduce pedestrian injuries Intelligent cruise control Rear active steering