As Nissan and Infiniti Sales Sink Yet Again, Automaker Continues to Shrink Incentives
You have to hand it to Nissan. Despite holding a continually declining share of new-car sales in the U.S., the automaker is sticking to its plan to firm up its financial footing.
That means holding the line on incentives and fleet sales — a practice it once revelled in back when the company pushed volume above all else.
Nissan brand sales fell 3.7 percent, year over year, in October, and the Infiniti brand staged a repeat of a performance we’ve grown used to in 2019. Its sales fell 23 percent last month. Year to date, Nissan volume is down 6 percent, with Infiniti posting a 17.1-percent loss.
Sales started to tumble last year as the automaker, finding itself under increasing financial pressure, pulled a U-turn on its sales strategy. However, new model introductions didn’t fill the void. The redesigned Altima eked out a narrow YoY win last month, but the model — now available with all-wheel drive — is still down compared to this time last year. Infiniti’s new compact QX50 crossover flopped badly after its 2018 introduction; sales of that innovative vehicle fell 53.5 percent in October, with volume down some 20.9 percent since the start of the year.
On a YTD basis, the only vehicles in the Nissan fold to show any buoyancy are the flagship QX80 SUV (up 1.4 percent), the midsize QX60 crossover (up a scant 0.1 percent), and the subcompact Kicks (which has the mathematical benefit of being introduced in June 2018). Overall, Nissan Group sales are off 7 percent through the end of October. Making matters worse, the automaker’s average transaction price fell 1.1 percent last month, compared to a 2.7-percent increase for the industry.
As for incentives, Nissan hasn’t taken off the wet blanket. According to data from ALG, Nissan’s incentive spend per unit was down 3 percent last month, compared to an industry that saw incentive spend rise an average of 4.7 percent. That said, the dollar value of Nissan’s spiffing outranked the industry average ($4,196 versus $3,767). Nissan incentives rose 2.7 percent in September following a 4.9-percent decrease in August.
Leading the pack among incentive increases last month were Fiat Chrysler and General Motors (both up 11 percent) and Honda (up 10 percent).
[Image: Nissan]
More by Steph Willems
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Does anyone have any theories on why the QX50 is such a flop? I've only seen two here in Los Angeles, and a commenter on another site said he's seeing blowout leases of $299/mo offered in San Diego. The QX50 looks fine (not ugly), interior is actually pretty nice, price is right at $299, Infiniti stores are usually at least a bit "upscale"...does the QX50 drive so poorly that even "normal" people hate the way it drives? Is it because nobody knows of its existence, and when they see an ad while car shopping online, see the bad reviews? I can't figure it out. The QX50 is the posterchild for "just build a crossover and it will sell" not being true all the time.
Nissan added dealerships. Increased fleet sales. Increased incentives in the most offensive manner to dealerships, the dreaded stairsteps. Dealership profit and loss statements tilted to loss. Dealership valuations plummetted at the same time as Nissan demanded facility investments. So what does Nissan do? Nissan is the most likely to terminate franchise and send default letters. Corporate is not cultivating a happy relationship. Perhaps this will all change for the better. There is a monumental shift in culture in the works at Nissan.