Nissan describes challenging target costing system in connection with the introduction of new products. Based on the analysis of the consumer and a life cycle study Post Nissan leads an exhaustive analysis of the cost of the components to determine whether a new model can be made profitable. Cost-cutting measures are then both internally and with suppliers to ensure that the model can be made to the tracked target cost. The target costing system is of key importance for further competitive Nissan … Read more »

Nissan describes challenging target costing system in connection with the introduction of new products. Based on the analysis of the consumer and a life cycle study Post Nissan leads an exhaustive analysis of the cost of the components to determine whether a new model can be made profitable. Cost-cutting measures are then both internally and with suppliers to ensure that the model can be made to the tracked target cost. The target costing system is essential for continued competitiveness of Nissan in the highly competitive Japanese auto market.
«Hide

from
Robin Cooper
Source: Harvard Business School
20 pages.
Release Date: 17 March 1994. Prod #: 194040-PDF-ENG
Nissan Motor Co. Ltd.: Target Costing System HBR case solution