By LINDSAY CHAPPELL | AUTOMOTIVE NEWS AutoWeek | Published 04/25/06, 8:55 am et CANTON, Miss. -- Something is wrong at Nissan, and Doug Betts has to figure out how to fix it. The quality of Nissan vehicles built in North America has slipped noticeably. The automaker is coping with subpar quality at its assembly plant in Canton, Miss. - which produces the Titan full-sized pickup, Quest minivan, Armada SUV, Altima sedan and Infiniti QX56 SUV. Two years ago J.D. Power and Associates' Initial Quality Study rated three Canton-produced vehicles at the bottom of their product segments. Last year the Quest was cited as the study's most improved nameplate. But quality issues resurfaced last month when Consumer Reports ranked the Quest, Titan, Armada and QX56 among the industry's least-reliable vehicles. Now Nissan is bracing for next month's release of the 2006 edition of J.D. Power's quality report. Speaking with reporters this month at the New York auto show, CEO Carlos Ghosn said quality has improved, but Nissan has more work to do. But Betts, 42, a dry-witted manager whose dark hair accentuates his youthful appearance, contends that the bad ratings reflect old data on vehicles from previous model years. The newly designed vehicles will do better, he says. "It's like a comet with a long tail," he says in an "enough, already" tone. "The story we don't want to talk about anymore is the cloud that has been hanging over Canton since it opened. The cloud is gone - the sky is clear, and it's blue." To stress the point, Nissan invited reporters to Canton this month to see the changes. In effect, Canton is Nissan's pilot project. If the new procedures work well, Nissan plans to spread them to other North American plants. At one station, assembly workers have begun using laser scanners and overhead display screens to monitor metal surface finishes. Imperfections in the metal had caused bad paint coatings. Since installing a better inspection system last November, Canton has reduced its vehicle defects by 45 percent, Nissan says. Betts also has formed 13 quality teams with responsibilities for electronics, brakes, handling, interiors, squeaks and rattles, delivery condition and other issues. Each team is made up of a dozen people from design, logistics, manufacturing, sales and other backgrounds. Their job will be to correct problems that show up on quality surveys or in warranty data, Betts says. Team leaders are to have the authority to make changes on the spot, even if it means ordering the redesign of a vehicle part. Nissan's teams are reminiscent of similar teams at Toyota Motor Corp. and Ford Motor Co. After Ford's assembly plant in Wayne, Mich., suffered through a difficult launch of the redesigned Focus, the company formed teams of engineers, manufacturing experts and hourly workers to troubleshoot quality problems. Betts also is tightening Nissan's inspection process. The company already has formal procedures to describe each factory job. But in a change that mirrors Toyota's inspection practices, Nissan plans to start using a 23-step checklist to evaluate each worker's role on the assembly line. "We've relied a lot on inspection," Betts says, "but we still had the defects." Ultimately, the strike teams are expected to identify quality problems that occur during Nissan's vehicle design and engineering, so that problems can be fixed before a vehicle goes into production. "We found that we were not working as closely with our suppliers as we should be," Betts explains. Nissan also plans to assign more personnel to work on quality with individual suppliers. Previously, about 20 Nissan staffers helped suppliers identify quality problems. Now there are more than 100. The new supplier team's first big assignment is to help launch the 2007 Altima. The sedan, unveiled at the New York auto show, goes on sale this fall. But Nissan won't have to wait for the new Altima to brag about quality improvements. As of last November, the company had reduced Quest warranty claims by 73 percent from a year earlier, Betts says, and warranty claims on all five Canton vehicles by 83 percent. Such improvements are not cheap. Nissan spent $60 million to redesign the Quest, which had scored especially poorly on J.D. Power's Initial Quality Study. The automaker eliminated some bugs and replaced the Quest's quirky front console with a more traditional instrument panel. Such costly redesigns are needed to help the Canton plant approach its full capacity of 400,000 vehicles annually. Even with the remodeled Quest, however, the plant is expected to produce only 320,000 units this year. Betts represents a new school of managers at Nissan. Starting in 1980, Nissan recruited many of its key U.S. manufacturing and engineering leaders from Ford. But Ghosn has tapped a new talent pool, including people he knew at Michelin. Besides working at Toyota's Princeton, Ind., truck plant, Betts held a quality manager's job under Ghosn from 1987 to 1997 at Michelin North America Inc. Jim Morton, who was promoted last month to vice chairman of Nissan North America, also worked for Ghosn at Michelin. Last year, Betts reached back to Toyota's Princeton plant to recruit Brad Thacker. This month, Thacker was named senior director of product quality. He also worked at Michelin under Ghosn. Betts says his most important credential is neither Michelin nor Toyota. "I'm a car guy," he says. "I rebuilt my first car at age 14." That car was a 1966 Ford Mustang. Now he drives an Infiniti M45, but he really wants Nissan's new GT-R sports car. Betts says he kept a poster of the Nissan 350Z hanging in a closet at home while he worked at Toyota. Thoughts of the GT-R help Betts keep his enthusiasm up while he reorganizes Nissan's corporate quality department. Nissan's quality team in California numbers 140 people who are primarily responsible for correcting problems that appear in warranty data. Now Betts plans to consolidate the California staff with an additional 500 to 600 staffers in the assembly plants who correct week-to-week quality problems that crop up. Nissan's plan to relocate its suburban Los Angeles sales headquarters, along with the quality employees, to Nashville this year will help Betts consolidate his staff. Betts' ability to form his own quality team demonstrates his clout at Nissan. It also shows that CEO Ghosn wants trusted lieutenants to handle the key issue of quality. Now Betts must deliver.