By Lauren Fix
I hope I’m wrong, but Nissan may be in a death spiral. Let me explain. Nissan lost nearly every dollar that it made last quarter. This is a very serious situation. And now Nissan is offering buyouts to salaried workers in U.S. as its business slides. In addition, according to CEO Makoto Uchida, states it used incentives to help convince U.S. customers to actually buy its cars.
The automaker’s profits fell 99% in its first quarter, running from April 1 through June 30, sending its stock plummeting nearly 11% before briefly recovering. In the entire quarter, the automaker profited just $6.5 million versus $835.5 million the year prior.
The U.S. and China typically make up 51% of Nissan’s automotive sales volume. The problem is, Americans aren’t buying Nissans like they used to, even with new products. This has led to the automaker forced to throw piles of cash in the form of incentives and discounts on the hoods of its cars and significantly increase its advertising efforts to stay competitive.
They are the only two markets where it sold more than 100,000 vehicles in the first quarter. Japan, its home market, is its third-largest market by sales.
Nissan even offered their dealers cash to take inventory back in March, sliding as much as $2,000 to retailers willing to take inventory of unsold Nissan Rogues. And, yes, customers noticed on social media sites and questioned why there were so many “New” 2023 Nissans on the lot when 2024 models had already been on sale for some time. On top of the dealer incentives, Nissan also offered 0% financing on some models while prime auto loan interest rates were still sky-high.
Another major issue is the lack of innovative cars in a changing car market. Nissan only makes two EVs today: Nissan Leaf and the Nissan Ariya and sales are not as expected. It also lacks any hybrid options, technically advanced features, and other popular items in a modern vehicle. Consumers paying top-dollar for a new vehicle want modern interiors, easy to use buttons and large screens, and Nissan simply hasn’t been delivering these in recent years.
As traditional automakers like Hyundai, Kia, Toyota, Honda and Ford have upped their technology, safety and powertrains, Nissan has been struggling. Apparently struggling to drive interest in their gas-powered Rogue.
The automaker’s newest flagship EV, the Ariya, is an export from Japan, making it ineligible for the $7,500 federal tax credit. The only exception is if the car is leased, which Nissan used to its advantage, eventually dropping the electric SUV’s lease price to as low as $199 per month. On top of the low monthly payment, Nissan also offered $9,280 in lease cash, $1,000 in bonus cash, and another $1,000 in loyalty cash. All of that comes to $3,780 over the federal tax credit. That’s a deal if you are in the EV car market.
Nissan has committed to launching seven new hybrids and EVs in the U.S. by 2028. Nissan will still need to convince customers to purchase its cars over the next four years while it prepares a new lineup and hopes to do that by refreshing 60% of its ICE-powered cars by next year. As the market demand changes, Nissan will need to consider hybrid, electric and gas-powered vehicles across the complete lineup to be competitive.
Nissan states “However, we’ll recover our performance by taking clear measures to address the challenges and launching new models.”
If you are shopping for a new vehicle, there are some good deals at Nissan and Infiniti. I do fear for their future as they brand cuts output and asks older employees to retire early. We will be watching closely as the year continues and keep you posted.
Lauren Fix, The Car Coach®, is a nationally recognized automotive expert, analyst, author, and television host. A trusted car expert, Lauren provides an insider’s perspective on a wide range of automotive topics and aspects, energy, industry, consumer news, and safety issues.
Lauren is the CEO of Automotive Aspects and the Editor-in-Chief of Car Coach Reports, a global automotive news outlet. She is an automotive contributor to national and local television news shows, including Fox News, Fox Business, CNN International, The Weather Channel, Inside Edition, Local Now News, Community Digital News, and more. Lauren also co-hosts a regular show on ABC.com with Paul Brian called “His Turn – Her Turn” and hosts regular radio segments on USA Radio – DayBreak.
Lauren is honored to be inducted into the Women’s Transportation Hall of Fame and a Board Member of the Buffalo Motorcar Museum and Juror / President for the North American Car, Utility & Truck of the Year Awards.
Check her out on Twitter and Instagram @LaurenFix.
