We wonder if Nissan CEO Makoto Uchida wishes he hadn’t come to America for this. For the first time since becoming CEO on December 1, he came to America to get answers. He wanted, from nine of the top dealers in the US, a no-holds-barred view of what they think is wrong with Nissan. If “the truth hurts,” then Uchida is writhing in pain at this moment.
Nine retailers gathered in a small room in the Nissan North American headquarters in Nashville. They plead for action on numerous issues they see. From faster product updates to better marketing support, there was a lot to bitch about.
Dealers have tons of frustration as sales dwindle
There’s a lot of frustration these days with everything Nissan. Besides slumping sales, residual values continue to fall and profitability is extremely low. They say Nissan has a “bargain basement” perception by consumers. That poor perception is partly to blame for Nissan’s current plunge in sales, list prices, and consumer confidence.
Nissan’s official response to its failing fortunes is that it is partly the fault of cutting back on rental fleet customers. But the retailers have been hurting for a long while and are edgy.
Uchida has been tasked by Nissan to steer the company into new, exciting models and more profitability for its dealer network. He was “seeking unvarnished feedback from the front lines,” according to Automotive News.
“We gave him an hour and a half of reality.”
According to those in the room, Uchida said, “I want to know all of the negatives,” he said. “I’m here to listen, don’t hold anything back-even if it’s hard for me to hear.” One rep said, “We gave him an hour and a half of reality.”
Uchida made it clear that Nissan could fold depending on its performance. Without a thriving US market, Nissan can’t exist. Retailers told Uchida to give US management more autonomy for them to improve the US market. Dealers also want more support for marketing and some financial help while they wait for the flood of new arrivals to happen.
Most all of Nissan’s models are old. It plans on replacing 70% of these with new versions by the end of 2021. From first-hand accounts, Uchida was very receptive to all of the comments. He says that since regions bring the results then Nissan corporate should support the regions.
The sales incentive program is a problem for dealers
The US sales incentive program is a source of problems for dealers. It rewards dealers hitting predetermined sales targets. It is seen by Nissan as a way to help dealers increase their throughput. But dealers see it as an endless pressure on them to push through sales for the Nissan mothership.
Dealers also want help in making the Nissan name “top-of-mind” by consumers.
Sales to rental fleets are having a ripple effect of lowering transaction price dealers’ used cars.
Dealers want to see less marketing for touting tech advances
Many felt that Nissan’s emphasis on promoting its technological advances hurt sales. “Self-driving cars may be great in Japan or different parts of the world, but in the US people are not responding to it,” a dealer rep told Uchida.
Dealers expressed more optimism after leaving the event. Many said Uchida was much more humble than previous CEO Carlos Ghosn. “It’s not “his way or the highway,” as it was when dealing with Ghosn. “No one in the room ever dared tell Carlos Ghosn what he didn’t want to hear.