As a Nissan rep pointed out via email last night, yesterday’s Chart Of The Day hardly tells the whole story of “the other Japanese brand.” Since 1995, Nissan has made up for declining “core model” sales by catching the tail end of the SUV/Truck craze with its Titan/Armada/XTerra/Murano combo. And, as this graph shows, those four models gave the brand a big spike for most of the last decade before diving unceremoniously towards oblivion (with the exception of Murano). Since then, Nissan seems to be targeting the niche left open by Honda: small, value-laden, efficient cars like the Rogue and Versa are Nissan’s new meal ticket (in addition to the still-soaring Altima). With a new Versa-based Juke mini-CUV launching this Summer, Nissan is poised to continue building on that image, but it still has to contend with remnants of its “Japanese Pontiac” and “Mainstream BOF-slinger” identities. Can Nissan be all of these things at the same time? Or will the Leaf EV halo push Nissan towards ever smaller, more efficient offerings and a neo-Honda emphasis on compact value? We’re hearing that changes are underway at the highest levels of Nissan’s leadership… coming up with a coherent brand vision and product plan for Nissan North America will have to be one of the new team’s top priorities.
My main takeaway from this chart and the previous one is that Nissan’s vehicle mix is moving decidedly downmarket. The Maxima, Armada, Pathfinder and Murano – ~$30K vehicles typically have all gone downhill.
Meanwhile, what’s selling are the Rouge and Versa. And their new products continue the trend — Cube and Juke. So Nissan is in danger of becoming the carmaker of choice for admins, retail clerks and call center reps.
Goodbye Godzilla, hello Hello Kitty.
The most striking thing I found is the moment the Murano trended downard was when the Rogue was introduced. Those CUV’s are cannibals!
This price trend towards lower cost vehicles is happening at every automaker, (heck almost every industry, housing? anyone). Maybe TTAC can find a chart of vehicle purchase price plotted with average household income and debt levels. Interesting to see if there is a huge jump from the cheap credit /great debt period of 2000-2006 when dumb Americans believed that everyone is entitled to fancy cars and houses regardless of their education or income earning level. There was a very good news article back a few years ago during the height of the recession when everyone was pointing fingers at the market crash and why it happened. The authors looked at household incomes levels correlate to with lifestyle purchases and debt levels. The data clearly showed why the US was screwed. Average car transaction price was ~$27K, yet the household buying those vehicle could only truly afford an $18K or lower car when you analyzed their true income levels. Authors also looked at housing in several markets and the numbers were mind numbing. Average price of homes sold was $462k to buyer who could afford no more than $182K. The US is in for a long term correction, very few households have lived at their true education/earning levels and they now are being forced to adjust to the reality of no vacations, no fancy cars or huge houses without years of hard work and sweat equity.
“So Nissan is in danger of becoming the carmaker of choice for admins, retail clerks and call center reps. ”
There are far more common folks then folks that can afford godzilla dude.
It makes business sense to try to target where the money is. While they target those markets they still have fun cars such as Z, GTR, Gs, and such. Where as Toyota and Honda problem right now is that they have no fun car whatsoever; well the LF-A but that’s unattainable.
If they was going to build only fun cars then they mind as well be a niche company such as Lotus and Aston Martin.
So the most fuel efficent of the newest models are currently doing the best? In other news, sunshine causes your body to produce Vitamin D…
I’m not shocked by the Xterra and Armada’s declining numbers. The Xterra is crude and only makes sense if you have the lifestyle neccesary for such a vehicle (like the Jeep Wrangler) and the Armada lives up to it’s name. (Spanish) Armada: a large highly armed fleet of ships, two large to manuver properly. Or as Brock Lovett (treasuer hunter) said in 1997s Titanic: “She doesn’t corner worth a damn.”
If history teaches us anything, Armada is not a good word for successful strategies :-)
http://en.wikipedia.org/wiki/Spanish_Armada
Missing from both charts: the cube has managed ~15K sales so far, putting it up above Armada sales, while Nissan’s sports cars (370Z coupe + roadster; GT-R) only make up ~6K 2010 sales, just a tiny bump on the chart. I think it’s always important for an automaker to offer something sporty. I just wish they offered something sporty at a lower price point (say, around $22K) than the Z…and the Altima coupe isn’t it. I miss the SX.
Cube was left out because it doesn’t look like much on a line graph charting sales since 1995… 2009 volume was 21,471, and YTD sales are 15,530.
Hmm … are these US sales only or do they include Can and Mex sales. Granted these countries have smaller markets, but Nissan has been charging in both of them over the period reflected on the graph.
It seems to me like Nissan lacks the essential ability to redesign a model to keep up with the moving trends, and you know what, that works just fine.
Nissan’s strategy is this: develop an overall strong brand-wide reliability score (not as good as Honda, Toyota etc. but still fairly strong), then slot the same powertrains into various models. Every few years come out with new models that best fit the marketplace (Juke, Cube, Murano in 2003, Maxima in the 80’s and 90’s). The cars that stay arguably most steady are the small to midsize sedans (Sentra, Altima) which partially explains why they are still around.
Example: The Pathfinder was both relevent and excellent in the 90s. They were well regarded as being reliabile true SUVs. Come 2003, times change, people want trendy stylish crossovers (or will over the next 6 years of lifecycle) and bam there is the Murano to pick up the slack. The Pathfinder maintains its character until the end (which should be soon?) and Muranos are everywhere. 2008 roles around and the big V6 crossover is slowly falling out of favour compared to the little efficient crossover. Bam: There is the Rogue. The 2.5l engine is fairly proven, as is the CTV transmission. Now their are Rogues everywhere.
Interesting analysis. This is what GM tries to do (accidentally) exept most of the time they don’t create a product good enough to keep people coming.
@Edward Niedermeyer
“coming up with a coherent brand vision and product plan for Nissan North America will have to be one of the new team’s top priorities”
Ed, you said it all in those two last lines. And in that coherent brand vision they should replace odd with attractive when it comes to exterior design.
What happened to Nissan happened to a lot of other brands. They had a great design philosophy which probably peaked in 2006 (last gen Altima, Maxima, Murano) then they had no where to go. The problem is that they car companies don’t always need to GO somewhere with their design, they can often stay put (ahem, MAZDA).
So now the Murano is fussy instead of stylish and polarizing, the Altima is dispreportionate and plump instead of sleek and classic and the Maxima seems to, in no way, tie in with any other Nissan product currently on the road. Also it is dispreportionate as well.
Nissan has some interesting vehicles. The Maxima is one of the best looking cars on the road, and this generation is the closest to the late 80s original in years. The Altima is Ok, nothing special, but a little less boring than a Camry. The Murano started the whole swoopy CUV craze, so credit is due there.
The Titan shows as a huge embarassment on that chart, Ford sold more F150s in a few months during the he’ll that was 2008/2009 car sales than the Titan did all year in its best years.
The Leaf will be a niche vehicle, but at least give Nissan some good exposure and green cred. I am not afraid of adventurous styling, for example I like the new smiling Mazdas and the guillotine faced TL, but the Juke is disgustingly ugly, I predict a huge flop on that one.
Edward Niedermeyer,
By singling out Nissan on your past two graphs you are showing a very misleading trend about Nissan in general. You see, this is NOT a Nissan trend, this is a MARKET trend. Toyota has a competitor for essentially every one of Nissan’s models, try making both graphs again this time with Toyotas models. Guess what? It will look IDENTICAL.
Nissan dosnt have a problem, in fact in the past 5 years they’ve gained more market share then any other Japanese company. The market is shifting and has been for some time. Nissan knows this as well as all the other automakers, thus why new vehicles have been put into production and CUVs,small cars are growing ever popular. In fact i’d say Nissan out of ALL the Japanese automakers has the most coherent brand vision, Carlos Ghosn is to thank for that, what he’s done for the company in the last decade is incredible. No wonder they have written books about Ghosn’s success with Nissan.
The two companies that need to be worried for the future?? Honda and Toyota. Toyotas surived off their “quality” and “reliability” image for the past 20 years, recently their quality has slipped significantly as well as reliability. Their interiors are now below par and their line up has less excitement in it then Volvos. Hondas turned their back on their previous design philosophy and no longer cares about anything except stale designs that strive for efficiency, and their entire line up is in need of a major refreshing. Both of these companies are seen as appliance makers more then car makers now, and with GM and Ford regaining ground with ever improving products you can be sure Honda and Toyota will be the first to lose ground.
Nowhere in my post do I suggest that Nissan is uniquely in trouble… in fact I explicitly state that Nissan is poised to grab Honda’s once-lucrative market position.
It’s nearly impossible to tell the whole truth in a single post or graphr… what you see here and in the previous post on Nissan’s sales performance over the last ten years may not be the whole story, but it is the truth. And why are we “singling out” Nissan? Because, as was stated in the original post, we hear of big shake-ups inside Nissan’s corporate structure. Nissan is under TTAC’s magnifying glass because things are changing at that company and we think it’s worth speculating about where the company is headed. These charts were intended to be the jumping-off point for that discussion.
Agreed, Honda has lost their way with the fat-assed Accord and ugly Crosstour, Pilot, and Odyssey. The present Altima hasn’t really grown dimensionally over the 2002 model (when it got substantially bigger and began offering a V6 to fill the Maxima’s former position; the Maxima would move upmarket beginning with the 2004 model).
I think one of the big things that everyone is missing (due to the scaling of the two charts) is that Nissan only has 1 vehicle that can sell over 100K units in a year vs 11 (or 13 if you include the Z and the Cube) that sell less than 100K units. Where as, back in 1995, they had 4 cars that could sell over the threshold. They need to do something with these vehicles to push their sales (not at the expense of profits) so that they are not relying on the Altima to provide all of their volume.
Don’t the Versa, Cube, Rogue, and Juke use the same platform? Not quite the same as selling a lot of the same model, but it’s a fairly cheap way to boost sales by appealing to different tastes.
@ Russycle
No, the Rogue is based on the Sentra (or Renault Megane, if you will)
Russycle- other than the Rogue (credit to SomeDude), you’re right. I think that we’re seeing the result of modern manufacturing ability. Not too many decades ago, BMW had 2 models, Volvo had 2, BMW 2, etc. – now they’re filling every imaginable niche. Including some niches that may have been best left undiscovered.
Anyway, Nissan seems to be doing a good job of this with their small platform vehicles. As a few have pointed out, the Sentra is no winner, but it doesn’t matter because the same platform is selling well here as the Rogue.
I feel smug for saying pretty much exactly this: Nissan is tracking where the market is going, and the market is going away from what they used to make and to what they make now.
There is nothing wrong with this. There is everything wrong with sticking to your stalwarts when it’s not selling, nor increasing in volume. If anything, Nissan isn’t trimming the deadwood fast enough.
Nissan has, at this time, the top-rated family sedan per Consumer Reports, besting the Accord, Passat and Camry. That’s huge, and the Altima’s sales show it. Nissan needs to grow from that (and already have with the Versa and Roigue), specifically by offering a competitive compact car (the Sentra is middling) and a three-row people mover, preferably a refreshed Quest and a crossover to be named later.
What’s also interesting is they’re showing some chutzpah in terms of product development. The Cube, Juke and Leaf will get them noticed without costing much, as the Murano did previously. And this has all happened relatively quietly and without the gong-banging that GM and VW resort to.
Nissan has, at this time, the top-rated family sedan per Consumer Reports, besting the Accord, Passat and Camry. That’s huge, and the Altima’s sales show it.
Altima’s have always been good to friends and family, although my sample size is heavily slanted to MT versions < 2006 m.y. I like the current version – although I'd never own one with a CVT.
I don’t think that “Nissan is tracking where the market is going.” I think what’s going on with Nissan is exactly the opposite. They seem to have to idea what American car buyers want and keep introducing such unsustainable models as the Cube, Juke, or the LEAF, for that matter.
What Nissan really needs is to
– streamline its products (half of the vehicles they’re selling should go)
– axe the unprofitable Infiniti brand (just like Acuras, Infinitis are not competitive)
– make their exterior designs more conventional (you even can’t convince me that the Altima looks better than the Fusion or the Malibu, can you convince me to buy the Juke???)
– leave that stupid “alliance” with Renault and look for a better partner, like Ford
Somedude, a few facts:
– that “stupid” alliance with Renault saved Nissan from bankrupcy. It’s been one of the most successful alliances in the industry.
– I don’t know why you say Infiniti is unprofitable — Nissan doesn’t break out profitability figures, but “uncompetitive” is really just your opinion. The G and M have been competitive vehicles since they were introduced.
– Finally, why would you call the Cube and Juke unsustainable? — these products are already engineered and sold overseas. Importing them to the US is gravy for Nissan.
I’m not saying Nissan is in great shape in the US — their market performance has been pretty average. But your comments don’t appear well founded in fact.
SomeDude- wrong, wrong, wrong! At least in my local market.
Altimas aren’t so common here, but looking at the numbers it appears to be a big seller in the US. But Versas are thick in the streets. So are Rogues. Cubes are getting to be less of a novelty on our roads (and the Cube and Juke share the mortgaging for their platform with the Versa). I expect that every Cube and Juke that they sell is just making up PR/coolness that they lack with the Versa. O yes, the Versa is a shared platform with Renault, so that’s paying off there. The EU is a totally different market, so I can’t pretend to know whether Nissan’s marriage with Renault is good thing there or not.
Infiniti G37s are the closest competitor to the BMW 3 series in these parts. Hardly a waste. Mercedes, Audi and Lexus wish that they could do as well here in that class. I’ll admit that the M and Q are invisible here.
Maybe Nissan isn’t “tracking the market” exactly, but they look to be doing as good of a job as any except Hyundai/Kia. Maybe you’re confusing what you (like/don’t like) with what is (successful/not). I don’t think that cutting everything but the Sentra and Altima and going head to head with Honda/Toyota/Hyundai would be a wise plan in this market.
@SomeDude I have to agree with SherbornSean, Renault is completely integral to Nissan, and it is what brought Nissan’s saving graces to the market, namely the 2002 Altima and the Murano.
As for unsustainable products? The Cube is one of the few cars on the road these days where my parents and their friends 40s, 50s, 60s have all commented about them, seeing them, liking them, disliking them, and almost all of them have either identified the it as the “Cube” or the “funny square Nissan”…which would make any company proud. The Juke is definitely a risk, but then so was the Murano, Maxima, Altima (although less so) and Quest when they introduced them. The majority of those products were successful. Risks are necessary, and risks have one big for Nissan in the past. Stick to the safe is what Honda and Toyota are doing and shouldn’t be.
Ok…
1. Yes, it is true that the alliance with Renault once saved Nissan. But that was in 1999. It’s 2010 now and the problem is Renault is synonymous with ‘cheap car’ (except for big trucks). So, what is Nissan looking at: becoming America’s new Kia? Competing with Chrysler/Fiat?
2. Infiniti is unprofitable because, except the G37, other Infiniti-branded vehicles don’t sell well. Folks looking for a real luxuty car will probably buy a German or a Cadillac. The premium market is well served by Buick, Lexus, and Lincoln. This leaves both Infiniti and Acura with no market to compete in.
3. Cars like the Cube and Juke are unsustainable because these are one-hit-wonders. Just like the original Scion xB. Yes, they may see a couple of years of decent sales, but then the novelty effect will disappear, coolness will be there no longer, and sales will plummet. But Nissan’s lines are still tooled to stamp the ugly sheet metal, right? Re-tooling after just a couple of years of production is not a very good idea, I’m afraid.
@SomeDude, it depends on what you do with the profits from those “one hit wonders.” Can you invest them in the rest of the line-up and slowly increase overall sales. That might be a more important question for Nissan right now. Or turning those people who come in to look at Cubes into Sentra, Versa, or Altima buyers. I know a fellow female teacher who gave the Cube serious consideration and then when out and bought a Jetta, WTF? Nissan really dropped the ball there.
@SomeDude
Infiniti is very profitable, their sales are up nearly 40% this year and each model achieves a substantially higher profit margin then Nissans vehicles due here in the US. Luxury brands always command a higher premium, and thus comes a higher profit margin per unit.
Infinitis sales are increasing year after year and by the end of the year should pass up Acura in total sales. They already passed up Lincon years ago. To say Infiniti isnt profitable or competitive shows how little you perceive of the sport luxury segment. Many see Infiniti as the only Japanese Sport Luxury car maker, and next to Mercedes the only true competitor to BMW.
If you have not had a chance to look over the new M37/M56 take a look, it recently beat out the BMW 5 series in C&Ds latest comparison and on many angles is simply best in its class.
Infiniti has one of the best product portfolios they have ever had. I’d like to see a new Q, and I’m guessing one will eventually come, but the G is 10x better than the old I, the M is 100x nicer than the old J, and the weakest product in the Infiniti lineup, the QX, is finally getting replaced with something that looks halfway competitive. The EX and FX don’t light the world on fire, but the Lexus RX has the luxury crossover market cornered at the moment, and the X3/X5 get most of the performance buyers, that’s a very tough segment.
I’m ready to call the Cube a failure at this point, not in the design or engineering, just as sales go. I see many many more Kia Souls than I see Cubes, and if Scion can’t make it with the boxy econo-car thing with the Toyota name behind it, Nissan doesn’t have a chance. The Juke is going to get laughed out of the US market, but I hear it is selling pretty well in Japan.
Nissan’s only major poor product decision IMO is sticking with the Titan. The sales are awful, and even when they were good they weren’t that good. Nissan dealers are practically giving them away and they still can’t move the metal. Toyota can’t even make decent inroads in the pickup truck market, and the Tundra is a much nicer product overall compared to the Titan. The American public has spoken and they aren’t interested in buying Japanese full-size trucks. Now, Nissan has had success with the hardbody in the past, and the Frontier sells decently. Toyota is cornering the retail compact pickup market with the Tacoma, and if Nissan were smart they would invest their dollars into competing there instead of dumping money into the Titan black hole that will never be anything more than an also-ran.
The American public has spoken and they aren’t interested in buying Japanese full-size trucks
This is not actually true. Year over year, save for carmageddon, the Tundra has taken bigger bites out of the market and has grown versus prior years. It’s now a credible threat to the Ram and sells about on par with the Sierra 1500 (though not the Silverado).
But back to Nissan: I don’t think the Cube is a failure, either. It doesn’t sell in huge numbers, but it doesn’t cost much to make, either, and sells for more than the Versa. More importantly, it gets noticed. The Soul might be selling better, but together the Versa and Cube do well against the Soul and Rio. Or the Fit, Yaris/xD, Aveo, Accent, etc.
@ Mercennarius
I would not be so sure that getting a higher profit margin per unit sold applies to all luxury/premium cars. To be able to get high profits, you should keep the costs low and charge a high price. First, most Infinitis (unlike Lexi and Acuras) are built in Japan, which means Oppama and – thanks Wikipedia – Tochigi. Then, Infiniti-branded Nissans do not share their FM platform with regular Nissans save for the Fairlady Z. So, we can already suspect that production costs are quite high, possibly as high as with BMWs. At the same time, Infinitis are sold at lower prices compared to the Germans. Finally, I only see G35s and G37s rather frequently (never seen a live M), while bimmers seem to be everywhere. As a result, it seems that BMW both sells more vehicles and gets a higher margin per each car sold.
@ educatordan
With things like the Cube or Juke, things are trickier. All that Nissan can hope and pray for is a strong and stable demand in Japan so that they can build a lot of them for the domestic market. You say Nissan can re-invest any profits they get from selling these. Well, are there any profits, given that the company probably still owns something in the neighbourhood of 60-100 million dollars for tooling the lines to build the damn cars.
Nissan’s weak position product-wise is reflected in its poor profitability.
Further, Nissan’s 2nd-tier status is reflected in its huge incentives – and that’s retail. Nissan does fleet huge in comparison to a top-tier company like Honda.
https://www.thetruthaboutcars.com/gm-tops-june-incentive-spending/
Nissan spends roughly 2/3 more than Honda per car on incentives. Nissan is currently a blue-light special company.
Me thinks the Titan needs help. Forget the niche or wanna-be city tough-guy. The vehicle must focus on becoming a serious consideration for the real truck buying consumer (commercial, farm, construction, etc). When these guys start driving them the wanna-bees will follow.
The front grill and front profile are too different from the competition. Especially the grill which I’d change first and save the sheetmetal costs of changes to the fenders and hood.
Peddle the truck in car-marts where it can mingle with the competition as opposed to franchises which scream “I’m different”. Volume to the important truck buyers is paramount. Then can come volume and profits from the wanna-bees.