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Thread: Interesting explanation on some Nissan models falling sales... it's by choice

  1. #1

    Interesting explanation on some Nissan models falling sales... it's by choice

    Nissan Division's trucks and crossovers set a June record, with sales 16 up percent to 65,493 vehicles. Car sales fell 12 percent to 66,114.

    By comparison, Versa subcompact sales dropped 44 percent to 8,155 units for the month.

    But Judy Wheeler, Nissan Division vice president of U.S. sales, said that change reflects an intentional move by Nissan to back away from the Versa segment. Nissan is instead making more of an effort to help retailers stimulate certified used-car sales, and that requires the factory to do less to market Versa, she said, which the brand traditionally has used to move customers out of used vehicles and into new.

    http://www.autonews.com/article/2017...A3850D085F8B2C
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  2. #2
    The "Versa segment"? I guess she means subcompacts. But I still have to think she is just trying to justify the sales drop.
    If someone blows up a school with a bomb they go after the bomber ... if someone shoots up a school they go after the gun.

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  3. #3
    Yeah, sounds like corporate speak for tripping on a crack in the sidewalk & saying "I meant to do that"
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  4. #4
    Quote Originally Posted by MikeD View Post
    Yeah, sounds like corporate speak for tripping on a crack in the sidewalk & saying "I meant to do that"


    .
    .
    .
    .
    If someone blows up a school with a bomb they go after the bomber ... if someone shoots up a school they go after the gun.

    A privilege is just a right that has been taken away by government.

    Political correctness is cowardice wrapped in a lie.
    ________________________________

    2013 Acura RDX Tech, 30% tints, hardwired Escort 8500 X50

    2011 Infiniti M56, 30% ceramic tint, hard-wired Escort 8500 X50, LED cabin and trunk lighting - traded!


  5. #5
    Looking at the evidence, I'm inclined to believe Wheeler,

    1. They have a lot of new car volume now and many of those cars will be coming back off lease, so what are they going to do about them, why not make an additional dollar on the same car by pushing certified pre-owned, would you rather have a used 2014 Maxima under manufacturer warranty or a brand new well equipped Versa?
    2. Versa sales unexpectedly dropped and have stayed in the 8-10k range for a while now consistently, you really think they couldn't move more if they wanted to?
    3. Nissan even dropped the base Altima there is nothing below the S now.
    4. Nissan is focused on Rogue, Leaf and probably the next Altima, more profitable vehicles.
    5. There has been major changes going on in the dealership network (finally) spearheaded by Nissan.


    Believe it or not I think Nissan has a strategy to go after more profitable vehicles and bigger, overall master plan for sales and dealerships
    2015 Nissan Rogue SV AWD.

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  6. #6
    Well, in spite of attempts to make it nicer, the Versa is still a piece of excrement that sells to the very young and to people who just can't afford more. I honestly believe Nissan has it in the lineup only because they have to have a cheap entry-level vehicle. But it isn't selling well, and I don't believe that's by design.

    The truth is that trucks and SUV's are what is selling now, and all mfr's are feeling it.

    All the brands have the 'problem' of cars coming off lease, and in fact it's a bigger issue with the premium brands, where as much as 75% of their sales are leases. And the certified pre-owned gambit is something almost every brand and every dealer utilizes. It's a way of making their used cars look more attractive.

    But remember - the profit at the dealer level is in used vehicles ... not the new ones. Even so, the mfr's HAVE to sell the new ones to the dealers, because that's where THEIR profits come from. I can tell you that it is a push from both sides for the average dealer ... he is trying to move used cars where the biggest margin is, and the factory is squeezing him to buy more new cars, where he really doesn't make much. And although we usually think of the factory as driving the train, they are pretty much slaves to their dealer network.
    If someone blows up a school with a bomb they go after the bomber ... if someone shoots up a school they go after the gun.

    A privilege is just a right that has been taken away by government.

    Political correctness is cowardice wrapped in a lie.
    ________________________________

    2013 Acura RDX Tech, 30% tints, hardwired Escort 8500 X50

    2011 Infiniti M56, 30% ceramic tint, hard-wired Escort 8500 X50, LED cabin and trunk lighting - traded!


  7. #7
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    Quote Originally Posted by MikeD View Post
    Yeah, sounds like corporate speak for tripping on a crack in the sidewalk & saying "I meant to do that"
    bingo!
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  8. #8
    Uhhh... despite its slipping sales, the Versa is still the top selling car in its class... by a pretty large margin. Though YTD its dropped from 72k in June 2016 to 56k in June 2017, its closest competitor, the Hyundai Accent has moved only 32k(and its down 21% for the year so far).

    To be honest The reason they gave doesn't seem that far fetched when you see how large of a gap there is in sales between the Versa and it's competition. They can essentially forfeit some of that market share to divert people to CPO cars and yet still be at the top of that class.

  9. #9
    What makes more sense to me is that they did do this intentionally but for other reasons. Nissan has a very high percentage rate of fleet sales. Clearly it is hurting them in the long run because it hurts resale values. The numbers for the versa is best in class simply because of fleet sales. I have a feeling they are trying to move away from models that sell mostly to fleet.

  10. #10
    Quote Originally Posted by NissLover View Post
    Uhhh... despite its slipping sales, the Versa is still the top selling car in its class... by a pretty large margin. Though YTD its dropped from 72k in June 2016 to 56k in June 2017, its closest competitor, the Hyundai Accent has moved only 32k(and its down 21% for the year so far).

    To be honest The reason they gave doesn't seem that far fetched when you see how large of a gap there is in sales between the Versa and it's competition. They can essentially forfeit some of that market share to divert people to CPO cars and yet still be at the top of that class.
    Quote Originally Posted by NismoS224 View Post
    What makes more sense to me is that they did do this intentionally but for other reasons. Nissan has a very high percentage rate of fleet sales. Clearly it is hurting them in the long run because it hurts resale values. The numbers for the versa is best in class simply because of fleet sales. I have a feeling they are trying to move away from models that sell mostly to fleet.
    Agree on both.
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  11. #11
    Quote Originally Posted by NismoS224 View Post
    What makes more sense to me is that they did do this intentionally but for other reasons. Nissan has a very high percentage rate of fleet sales. Clearly it is hurting them in the long run because it hurts resale values. The numbers for the versa is best in class simply because of fleet sales. I have a feeling they are trying to move away from models that sell mostly to fleet.
    That makes no sense to me at all. Fleet sales are the lifeblood of all these big auto companies. Why on earth would they make a move to kill off the easiest sales fruit to pick to bolster the resale market. The only skin they have in the resale game is residual values on leases they are holding ! Having worked for several different auto companies I can assure you no one in the boardroom is wringing their hands over resale values !! New car sales volume is the name of the game & what they are fully focused on.
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  12. #12
    Quote Originally Posted by MikeD View Post
    That makes no sense to me at all. Fleet sales are the lifeblood of all these big auto companies. Why on earth would they make a move to kill off the easiest sales fruit to pick to bolster the resale market. The only skin they have in the resale game is residual values on leases they are holding ! Having worked for several different auto companies I can assure you no one in the boardroom is wringing their hands over resale values !! New car sales volume is the name of the game & what they are fully focused on.
    Have to agree. Resale values aren't the priority of the mfrs. - they sell new cars.

    It has to be a distant consideration, since resale values can have a negative effect on new car sales, but it's not front of mind for the mfrs.

    Also agree on the fleet sales thing ... these people actively solicit fleet customers and they love them. It's their bread and butter.
    If someone blows up a school with a bomb they go after the bomber ... if someone shoots up a school they go after the gun.

    A privilege is just a right that has been taken away by government.

    Political correctness is cowardice wrapped in a lie.
    ________________________________

    2013 Acura RDX Tech, 30% tints, hardwired Escort 8500 X50

    2011 Infiniti M56, 30% ceramic tint, hard-wired Escort 8500 X50, LED cabin and trunk lighting - traded!


  13. #13
    I'm not sure exactly how it works but what happens with all the lease returns? Aren't those vehicles mostly sent of an auction? If so, when you cant sell your lease returned vehicles for a break even point, dont you have a lose at that point? The used car market is terrible and from what ive read its the next bubble.

  14. #14
    They make money on some, lose on others. Establishing residual values is something of a crap shoot since no one can 100% predict what the market will be like for any given vehicle in 2, 3 or 5 years. Rental companies essentially have to make the same 'educated guess' at what their fleet will be worth down the line so they can establish rental rates. There is tons of historical data for these big corps to draw on when they establish their residuals, they have it down to a science Remember, these guys are churning 10's of thousands of vehicles and know they will eat it in down markets, but make more in strong ones.
    2016 Challenger Hellcat, Max Steel/Blk - A8 trans, Navi, C Fiber Stripes
    2018 Durango R/T, Vice White/Blk, Tow, Blacktop pkg, Perf Tires
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    GONE:
    2003.5 G35s Caribbean Blue - Prem, Wood, Spoiler
    2009 G37 Vert Athens Blue/Bone - Prem, Sport, Nav
    2016 Mustang GT Prem, Guard/Ebony - Roush SC +++ ** Lmn Law 1200 mi
    2009 M45s Obsidian/Graphite - Sport, Tech, Adv Tech, Wood, Spoiler
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    2002 Q45s Desert Platinum

  15. #15
    Quote Originally Posted by MikeD View Post
    They make money on some, lose on others. Establishing residual values is something of a crap shoot since no one can 100% predict what the market will be like for any given vehicle in 2, 3 or 5 years. Rental companies essentially have to make the same 'educated guess' at what their fleet will be worth down the line so they can establish rental rates. There is tons of historical data for these big corps to draw on when they establish their residuals, they have it down to a science Remember, these guys are churning 10's of thousands of vehicles and know they will eat it in down markets, but make more in strong ones.
    At lease end, if the dealer wants to, he can keep the car and sell it himself. Only the rougher ones go to auction. And don't think any losses in the residual/auction side of the equation aren't made up on the new car pricing side.

    And then there's the people like me who trade out of leases early, so the mfr isn't even affected.
    If someone blows up a school with a bomb they go after the bomber ... if someone shoots up a school they go after the gun.

    A privilege is just a right that has been taken away by government.

    Political correctness is cowardice wrapped in a lie.
    ________________________________

    2013 Acura RDX Tech, 30% tints, hardwired Escort 8500 X50

    2011 Infiniti M56, 30% ceramic tint, hard-wired Escort 8500 X50, LED cabin and trunk lighting - traded!


  16. #16
    I think naysayers against the VP of Nissan, Judy Wheeler claims seem to have missed several things...


    1. All the recent articles that seem to come out every other day bashing Nissan being the "fleet king" and how they "cheated" with their sales increase because there are claims it was all boosted by fleet sales, Nissan executives dont deny that they have picked up some fleets sales where other automakers have abandoned the realm but the estimated claims as a percentage of total sales and how much it boosted sales by media outlets is questionable, these media outlets and research firms predictions, are NOT FACT! Is it really a bad thing? Depends on how you look at it. Apparently selling to fleet isnt has bad as everyone thought since Toyota has announced it's doing the same thing as Nissan (hence the huge jump in Rav4 sales int he past 2 months) despite executives at honda constantly criticizing Nissan about it from their high-horse. But like it or not, resale does matter to the regular retail consumer which is where the most money is made, not fleets. If you can switch a fleet sale with a retail sale that has a higher sales margin and transaction price why wouldn't you?
    2. Key words are missing like: Certified Pre-Owned, which is different than just regular used cars, automakers charge fees, they increase transaction prices and raise value of their vehicles in the used car market. There are a lot more Nissans on the roads now and the company apparently doesnt want to inundate the used car market and bring down value. I guess they have leeway to push higher, since more volume is coming out of Rogue, Rogue Sport, Titan, Armada etc, better to put energy behind those more profitable vehicles.
    3. Transaction prices is another key term missed, which is the ultimate goal imo, Nissan seems to be trying to raise their average transaction prices, hence Nissan dropping the base model Altimas. There was an article where it says Rogue increased Nissan transaction prices an average of 6 percent, one of the highest increases in the industry.


    I really do think Nissan purposely lowered Versa sales, the drop is too drastic from month vs. month, but as pointed out previously, it's still sells enough to be the sales leader by a good margin, I think the brand is doing everything to focus on higher transaction prices, riding the wave of the Rogue momentum, but they really need to start focusing on overall brand image marketing, i.e. publicizing quality, performance, fuel economy, reliability etc. It's ridiculous how Toyota and honda have had so many massive recalls far larger than Nissan ever had yet they are deemed more reliable based off of anecdotal evidence. Even consumer reports wont count recalls in their reliability reporting.

    The 11th honda vehicle death in the U.S. from airbag shrapnel was just announced by the company yet their brand image remains untainted?
    Last edited by Nissan_Motor_Co; 07-11-2017 at 04:53 PM.
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