A larger-than-average new vehicle inventory, compounded by a change in strategy and dismal April sales figures, means fewer vehicles leaving Nissan assembly plants in the United States and Mexico in the foreseeable future.
The automaker plans to cut production by as much as 20 percent in the hopes of firming up its bottom line.
On May 1st, Nissan reported an 88-day supply of new vehicles, well above the industry average of 73 days, Kelley Blue Book reports. That’s double Subaru’s supply and still more than Fiat Chrysler or Ford.
According to Nikkei Asian Review, cuts are already underway at Nissan’s two U.S. assembly plants and three Mexican facilities. No job losses are expected. However, employees might find themselves with an extra day or two spent at home on any given week. By summer, production should decline by 10 to 20 percent, with the cutbacks drawing to a close in the fall.
Last month, the Nissan brand’s U.S. sales fell 29.1 percent, year over year, pushing the automaker’s 2018 volume to a 6.3 percent drop. Infiniti sales fell 17 percent, year over year, with the automaker’s luxury division posting an 8.3 percent year-to-date loss.
For May, Wards Auto predicts a daily selling rate 11.2 percent lower than the same month last year. That’s a larger anticipated sales loss than even Hyundai-Kia.
The month of April corresponds with the beginning of a fiscal year where Nissan plans to get moving on a new corporate strategy of lowered incentives, fewer fleet sales, and suppressed production. Obviously, this stands to bring fewer buyers into Nissan showrooms. While the automaker posted huge sales gains in the years following the recession, maintaining those higher volumes came at a cost — something CEO Hiroto Saikawa isn’t interested in continuing.
Nissan’s new North American chief, Denis Le Vot, has orders from HQ to boost brand value and profitability in the region. Long gone is the automaker’s former passion for growing market share above all other considerations. In the last quarter of 2017, operating profit fell 50 percent.
It’s expected that the throttling back of North American production will take a 3 percent bite out of the brand’s U.S. sales.
On the product side of things, Nisan buyers gain two new models this year: the subcompact, front-drive Kicks crossover (already available in Latin American markets), and the redesigned 2019 Altima sedan bound for the brand’s Canton, Mississippi and Smyrna, Tennessee assembly plants.
[Image: Nissan]
Once you’ve become the KMart of cars like Nissan has, a tarnished discount brand, there’s no going back.
The AutoExtremist guy seems to indicate that Nissan has zero brand equity at this point.
Full here: http://www.autoextremist.com/current/?currentPage=15
Meh, that guy is also on Ford Death Watch, now I guess he will be twice a busy on his Nissan Death Watch as well. But sure, Kia’s super timely investment into a new RWD sedan in a crossover crazy market is definitely gonna go well, it’s not like there are any much cheaper and established vehicles in the 4000lb weight class.
It appears that Nissan has arrived at the inevitable cross road they laid out for themselves. A sharp curtailment of rental dumping coupled with a tightening in the sub prime lending markets. Seems like we have seen this movie before with other manufactures. Reminds me a lot of Pontiac, though I am not suggesting that Nissan will close up shop.
Pontiac only produced terrible cars. Nissan still has a decent lineup. What they really need is a new Frontier.
@Mandelorian- Yes, they need a new Frontier. But Pontiac was killed at the insistence of the Obama administration.
“scarey”: ‘nuthur skandle frum thet Deep State Obamer, a corn-spiracy! Of course, Bush began the GM/Chrysler/Ford auto parts supplier bailout.
The Bushes (41 and 43) were no box of candy either. Neither was 42.
“Pontiac only produced terrible cars” yeah right! that’s why i’m still driving my 1997 Pontiac grand Prix that I bought new, it has 178K miles and believe it or not has NEVER had a tune up, that’s right, original plugs and wires! 3.8 v6 (one of the best engines ever) and it still is a very nice looking and designed car, no transmission work either, not like those crappy CVT’s, oh yeah, the air still works also!
Pontiac is a damn fine car. Ran over my wife with a Pontiac.
Nissans were much better cars to drive than Pontiacs. Pontiac was the symbol of GM falling behind the times and pennypinching.
@redgolf- Is spending 21 years ensconced in one of the worst car interiors of all time supposed to be a win?
I think it is.
They could re-introduce Datsun, and consolidate their dealerships into Datsun-Nissan-Infiniti. You could choose from a cheap and economical Datsun, a middle-class Nissan, or an expensive and luxurious Infiniti.
Each line could have a unique-to-it model or two, as well as entry-level/mid-level/premium versions of the same car for each brand, such as Ford/Lincoln (without Mercury any more) does. There is some advantage to one-stop shopping, with something for everyone.
I’ll take a customizable 2019 front-engine, rear-drive Datsun 510, please.
Great idea,RHD. I’ll take (another) Datsun pickup.
the super smart scientists over at the EPA SAB don’t want you to have any of that. No Nissan/Datsun pickup can pass the CAFE mandate in 6 years time without heavy penalty.
“They could re-introduce Datsun, and consolidate their dealerships into Datsun-Nissan-Infiniti. ”
How well GM is doing with Buick and Ford with Mercury? Nah, it will not work.
I seem to see more Titans around than any of the sedans or hatches, are they making any dent in the full size pickup market ?
The Titan XD’s won’t fit in an average garage and the regular Titan doesn’t have enough payload to tow any thing. RAM has had this very problem until this year. (Don’t be fooled at what it is rated to tow-you will hit max payload way before max towing weight).
Is this for Nissans only, or Infiniti models as well? Still hoping to snag a great deal on an over-supplied Q50 :-)
Q50s are made in Japan, so they should keep stuffing that pipeline.
Must be that chicken tax keeping an import brand down again. Or not