By on December 11, 2017

Expect your local Nissan salesman to work extra hard for that pre-Christmas sale. That’s because Nissan, which can still boast a year-to-date sales increase in the United States, isn’t exactly overflowing with 2018 models.

Inventory of 2017s remains higher than the automaker would prefer, meaning it needs to do something to move old stock out before the end of the year. But rather than heap more factory bonuses on its vehicles (the company’s incentive spending is second only to Kia in the industry), Nissan figures it’s a better deal to throw incentives at the salesperson.

“Happy holidays. Can I interest you in a new Rogue? Seriously, how ’bout that Rogue?”

According to Automotive News, 60 out of every 100 vehicles on U.S. Nissan lots is a 2017 model. Blame the late launch of several 2018 models and a general downturn in the industry.

The solution, in Nissan’s mind, involves tossing $100 at salespeople for every sale reached, and $50 to the sales manager. This is on top of any existing staff sales incentives.

Nissan’s new “spiff” is great news for salespeople with a knack for closing the deal, but it isn’t necessarily making dealers happy. One Nissan retailer told AN that the incentive just leads to salespeople chasing “low-hanging fruit” — easy sales, often of low-profit models. Others would prefer to see factory cash sent to dealers, not salespeople.

While its sales are indeed up, both in November and the year as a whole, steep customer incentives and an increase in fleet volume hasn’t put the company on stable financial ground. At least, not in North America. Operating profit in that region fell 42 percent in the first half of 2017.

Under the direction of new CEO Hiroto Saikawa, Nissan’s aggressive sales targets are a thing of the past. The game plan for North America is now “steady, profitable growth,” according to the automaker’s North American chairman, Jose Munoz.

That could explain why December incentives are more or less steady compared to the month previous.

“We’re actually flat in overall incentives,” Judy Wheeler, Nissan Division vice president of U.S. sales, told AN. “The dollar amount per unit is flat from November to December. We’re just packaging it in a little different way. And we’re down from a year ago.”

In October 2017, Nissan’s U.S. incentive spending (as percentage of ATP) stood at 16.4 percent, well above the industry average of 11.3 percent. That spending dropped to 14.6 percent of ATP in November.

Year-over-year sales at both Nissan and Infiniti rose last month — 19.3 and 7.5 percent, respectively, mainly due to the popularity of light truck models like the Armada, Rogue, Frontier and Titan. Over the first 11 months of 2017, sales are up 2.1 percent at Nissan and 14.1 percent at Infiniti. Again, the increase has nothing to do with car sales.

Total passenger car volume is down 9 percent YTD, offset by a 16-percent increase in light truck sales.

[Image: Nissan]

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20 Comments on “Flush With 2017 Models, Nissan Throws Incentives at Sales Staff...”

  • avatar

    Translation: It’s just gotten a hell of a lot more annoying to go to a Nissan dealer. Your going to be outright assaulted by reps trying to force you into ANYTHING to get their bonuses.

  • avatar

    “…the incentive just leads to salespeople chasing “low-hanging fruit” — easy sales, often of low-profit models.”

    Because they should just leave all the low-profit models on the lot so they’ll make even less profit next year? I thought the idea was to clear out ALL of the 2017s, not just the ones with a fat margin.

  • avatar
    Jean-Pierre Sarti

    how hilarious is it that even the car makes try schemes to circumvent the dealers…I’m sure dealers, such as they currently are, play a role in today’s car buying process. I just can’t figure out what.

    • 0 avatar

      Factory to salesmen incentives are a great way to motivate salesmen to prioritize selling new cars and to prioritize YOUR brand in a multi-line showroom. Since most new cars are heavily discounted by the dealers, salesmen don’t make much on them. They make much more on used cars. Extra money for selling new cars is great for the factory and the salesmen, but yes, not so great for the dealer, who would make more on used cars.

    • 0 avatar
      Gardiner Westbound

      Dealers exist so car manufacturers don’t have to deal directly with customers. Better price information has reduced their margins. They focus on mystery fees and selling extras, add-ons and services. Every transaction is wrapped in distrust.

      • 0 avatar

        Yes it is. They are close to opening a Carmax where I live. I’m considering buying from them next year just due to the greasiness of the regular dealers.

        • 0 avatar

          I guess you enjoy grossly overpaying for a car.

          • 0 avatar

            Yeah, I don’t see the appeal of actually BUYING from Carmax, but it’s a great place to compare competing models right there on the same row of the lot (minivans, trucks, etc). I went with my wife a while back just to window shop vans briefly and we could look at Siennas, Caravans, Town and Countrys and Sedonas lined up one next to the other. Likewise looked at fullsize SUVs and could sit in a Sequoia, Yukon, Expedition, etc all in a row within seconds of each other while the other vehicle is still fresh in your mind.

  • avatar

    I can attest to that. My wife and I were in our local dealer on Saturday trying to talk about a Juke, but since they didn’t have the SL on the lot, all they wanted to do was talk about the Rogue Sport. At one point I thought I was in a contest to see who (sales person or sales manager) could insert the most references to the Rogue Sport into the conversation.

  • avatar

    Nissan might consider providing low interest 7 year financing and a free tow to the scrapyard upon receiving the last payment, if the junkyard find Cube represents typical Nissan durability.

  • avatar

    Maybe some prospective buyers were lost because they had the eye-opening experience to have rented one for 7 days. Time in the seat of an actual Nissan sure takes the gloss off the showroom displays.

  • avatar

    I’ll buy a new Rogue. Only if it comes with 2 free CVT transmissions in a crate in the rear cargo area as part of the purchase.

  • avatar

    Reading this info, doesn’t look like trucks and larger SUV’s fit this incentive. A friend bought a new Titan XD with Cummins diesel, and it’s pretty impressive. Sticker prices are a bit much with high end units floating near the 70 K mark, and a paltry 7 K incentive mark down. Ram, Ford, and GM trucks of similar size with diesel are close to the same price range, but have incentives of over 10 K…

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