Just a week ago Nissan disclosed that sales in China had dropped by a massive 30% year over year (February 2024). The drop is explained away by Nissan executives as being caused by Chinese New Year, but two Nissan statistics also caught our attention and made us wonder how Nissan is going to survive.
Auto industry analysts expect all major auto manufacturers around the globe to sell a substantial number of vehicles to fleets. From police forces, to rental car companies, to governments, to large corporations, fleet sales allow car companies to keep their factories moving and bring in steady income.
The two problems with fleet sales is that they can go away very quickly and they always sell at a notable discount to the retail price. Professional auto industry analysts are usually unconcerned with fleet sales totaling less than 10% of a company’s total unit sales.
Nissan is at 44% fleet sales!
Nissan’s fleet sales surge. Dealers fear history is repeating itself.
https://www.autonews.com/retail/nissan-turns-back-rental-fleets-retail-stumbles
Last month, Nissan sold nearly 40,000 vehicles, or 44 percent of total sales, to fleet, including rental companies.
That is a terrifyingly large percentage and it tells you that their product is not compelling to retail consumers.
In a recent inventory disclosure, Nissan detailed that their best selling vehicle by far is the Nissan Rogue but 75% of the Rogue inventory on dealer lots, is from the model year 2023! In a few months, 2025’s will be released.
Watch this 1 minute video segment for more details.
That tells you Nissan can’t even sell their best selling product to consumers.
If we had to put it into a word that we’ve already used a couple of times, we say “compelling”. As in, Nissan Is just not producing vehicles that consumers find compelling.
2024 Nissan products:
Let’s look at each one of these four issues
When was the last time you were walking down the street and turned your head to check out the latest Nissan? Yeah, that was probably more than a decade ago.
The only interesting vehicles they have are the:
Nissan’s press release on its recent quarterly sales figures reveals the problems that have faced the Nissan Z. In the final quarter of 2023, the manufacturer sold just 462 examples of the Z. That is up from the 177 sold towards the end of 2022, which saw 263 Z’s sold in total. But across the whole of the 2023 calendar year, Nissan says it sold just 1,771 Nissan Zs. That plus the 263 from 2022 means that just 2,034 Nissan Zs have left the factory in 2023, compared to 7,152 Nissan Leafs and 128,030 Altimas.
https://www.hotcars.com/nissan-sold-2034-zs-since-launch/
We have been through the entire Nissan lineup and can’t find a single mass market vehicle, that has compelling performance. This doesn’t mean that Nissan makes vehicles that are all under powered but it means they have nothing sexy to promote.
During the pandemic, manufacturers were able to sell their vehicles above list price to hungry consumers that were willing to wait 6 or more months to take delivery. As a result several companies reduced their warranty offerings to match the Japanese standard of 3 years 60,000 miles / 100,000 kilometers. However, even that reduction in the competitive environment didn’t give Nissan pause to see the opportunity to increase their warranty ever so slightly to take an edge on other major car makers.
The undisputed heavyweight champion of the world for new vehicle warranties is Mitsubishi. Ironically, Mitsubishi sold controlling interest to Nissan at a fire sale price in 2016.
The automotive industry has stabilized its unit sales and while there is lots of negative press on a so called downturn in electric vehicle sales, it misses the point. Yes, the INCREASE in the PERCENTAGE of electric vehicle sales has stopped growing but EV sales are still growing at a massive 40% rate. That means if you’re not in the electric vehicle business, you’re going to be out of business, at least in Canada, the US, EU, and China.
When legendary automotive CEO, Carlos Ghons, announced in 2009 that the Nissan Leaf EV would lead the way to Nissan’s all electric future, many governments and consumers got excited.
“I’m betting 10% of the global buyers will make a rational decision on what to drive. And I think I’m being conservative at 10%,” said Mr. Ghosn. He made that prediction while discussing Nissan’s future over dinner Thursday night.
I caught up with Ghosn in Los Angeles as he starts a nationwide tour introducing the automakers new electric model, The Leaf. The car will come out late next year, and while Nissan has yet to announce a price for the car, Ghosn is promising it to be competitive. “People are suspicious if you are selling the environment, but if you can make it (buying an EV) financially reasonable, they will buy it.”
https://www.cnbc.com/id/33907442
And then very little happened at Nissan’s EV development teams. It took them another decade to show off the vehicle that consumers actually want, an electric SUV. The Ariya, was moderately interesting at trade shows and created some buzz in the market but they just took too many years to get the thing to market. With more than 1000 Nissan dealerships in the United States , they sell far fewer Ariya EV’s, than even EV start ups without any dealerships (like, Rivian, Lucid, and of course Tesla); this is an embarrassment.
And even though the leaf has gone through a couple of redesigns it still isn’t selling in volume.
Nissan sold 6,083 Leaf in 2023. In 2022, Nissan sold 12,026 Leaf. They sold 5,943 more units in year 2022 compared to 2023 with a percent loss of 49.42% YoY.
https://carfigures.com/us-market-brand/nissan/leaf
Normally in an article like this we would wrap up with a discussion about what Nissan is doing to fix their sales woes but other than some odd speculation about Nissan buying EV upstart Fisker, we can’t find anything that looks like it will turn their fortunes around in the next few years.
Put simply, Nissan is in trouble.
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