It’s been an interesting few years for Nissan. As the borders are still being drawn on the new automotive landscape, brand territories are being redefined. Toyota and VW Auto Group continue to defend their share of the market, while Hyundai/Kia continues to take from the competition as they build their empire while Ford continues to lose ground. And through all this, Tesla somehow manages to fortify a still relatively small space, but with a tenacity that has put the old-guard on notice.
For decades Nissan comfortably occupied a niche as the Japanese car for those who wanted something different. Toyota, long the standard-bearer, remains the choice for those who wanted a car that didn’t require a second thought, whether it came to reliability, design, or driveability. The vehicles, then and now, are the default for those who may not want a car but need one. Buy a Toyota and you’ll never have to pay attention to any of the other aspects of car ownership.
New Borders are Being Drawn on the Automotive Landscape
Honda plays the Pepsi to Toyota’s coke. If you want to buy a Japanese car but you think backward hats look cool, you buy a Honda. With a reliability history about on par with Toyota, Honda’s both different enough but similar enough to be a safe alternative. Other Japanese brands, like Mazda, Subaru, and Mitsubishi, have remained to niche, to different. While none of these companies are necessarily radical (though Subie’s commitment to AWD and boxer engines does make them interesting) they’ve never reached the size of a Toyota or a Honda.
Nissan, on the other hand, handily occupied a space between these two tiers of cars. Launching in 1914 under the name Datsun and rebranded as Nissan in 1934, their’s is a storied history. Still the leading Japanese auto company in Russia, China, and Mexico, they made it as high as the sixth-largest car company in the world, in 2014. If measured by their alliance with Mitsubishi and Renault, they’d occupy the number four spot.
In 2014, Nissan was the Fourth-Largest Car Company
Along with the typical sedan and SUV offerings, there’s also a strong performance heritage. The Datsun Fairlady’s gave way to the Z GTs, drift-happy RWD hatchbacks. This nameplate lives on to this day as the 370Z, though with few updates since then. The Skyline group of vehicles helped draw enthusiasm for their legendary performance from otherwise drab sleeper cars. Over the decades, the Skyline evolved into the ungodly, if unshapely, GT-R.
The GT-R, introduced in 2007, was a legit game-changer. Essentially a near-500hp laptop on wheels, it was a $100k-ish 2+2 coupe that handily shamed the best of the best, from Ferrari to Lamborghini to Porsche. This began a three-year reign of dominance where Nissan found itself in the conversation of high-performance cars.
All of this is to say that the times, they are a-changing.
A recent report from Reuters says that, in a desperate bid to stay solvent, Nissan will be shedding about 4300 white-collar jobs and close two plants, mostly affecting the US and European operations. Though their lineup is already aging, any changes will come from the cutting of models and trim options instead of new models. With sales down 74%(!) for the first half of 2019, and around 40% of their production plants either unused or under-used, there’s a lot of waste they can’t afford.
“The Situation is Dire. It’s Do-or-Die.”
(Unnamed Source Close to Senior Management. Courtesy of Reuters.)
While this decline is years in the making, it’s being exacerbated by some well-documented drama at the executive level. Former CEO Carlos Ghosn was arrested in 2018 for under-reporting personal and company assets. He was confined to house arrest where he loudly proclaimed himself a victim at the center of a vast conspiracy. Certain that the Japanese government was coming for him, he escaped to Lebanon through the help of a crack team of specialists, multiple passports, and a conveniently large musical case.
It was Ghosn that both helped Nissan ascend and crash. Nicknamed Mr. Fix-It, he’s credited with saving Renault in the late ’90s. He then orchestrated a complex alliance between the French Renault and Japan’s Mitsubishi and Nissan. For a time he was both chairman of the board as well as the CEO of Nissan. At Nissan, he sought to increase the company’s international presence, gaining presence in India, South Africa, Russia, and Southeast Asia. He also spent heavily on marketing and promotion to build brand awareness worldwide.
These expenditures had a toll. Among these are the failure to hit the sales goals for these new areas. Worse, Nissan’s luxury sub-brand, Infiniti has become the Lincoln to Nissan’s Ford. Consisting of an aging lineup, Infiniti has been squeezed out of the European market and has made little impact in North America. Billions were spent on developing the Infiniti VC Turbo, an electronically-enhanced four-banger aiming to produce greater torque while improving fuel efficiency.
Infiniti is the Lincoln to Nissan’s Ford
It hasn’t quite worked out that way. Instead of being a revolution for internal combustion engines, it’s an under-utilized boondoggle around the neck of an already struggling nameplate. While Nissan claims that they’ll continue to support the brand, it’s becoming difficult to see how.
What the next few years hold for Nissan remains to be seen. While the Leaf is an affordable city EV, it’s their only effort to adapt to a changing landscape. Instead, they’ll try to stay afloat on a diminishing lineup of already aged vehicles.
