Why Nissan dropped Pulsar and Altima
BY BYRON MATHIOUDAKIS | 8th May 2017
Defending his decision to discontinue the slow-selling Pulsar small car and Altima mid-size sedan earlier this year, Nissan Australia managing director and CEO, Richard Emery, admitted that while it was a challenge having no models in the sub-$25,000 new-car market, he said the cuts were necessary to ensure longer-term gain for the brand, dealers and consumers.
“Certainly our position on passenger cars, with the line-up that we had, is that we were exposed in terms of their competitive position and their specification availability,” he told GoAuto at the media launch of the facelifted X-Trail SUV in Melbourne late last month.
“From our perspective, with new cars due in the next few years, the most discipline and robust business decision (was a reasonably easy one).
“Let’s make sure we get the new products right in terms of their specification, pricing, availability and even design for that matter, and concentrate on where we are in a strong position. I think sometimes car companies can sometimes become focused on ‘we need everything we can and we need to sell as many cars as we possibly can’ without pursuing the quality of how you go about that.
“For me it’s about making sure we have a quality line-up that suits the market place, the economics and value proposition for the consumer in terms of specification is where it needs to be.” Mr Emery highlighted other tough decisions he has made that he said would ultimately strengthen the business.
“One of the first things I did when I joined Nissan was cancel the Almera. It didn’t have the spec that the market required both in terms of technologies and safety, it wasn’t particularly well positioned price wise versus the competition, and we were struggling with the car. It wasn’t adding anything to the brand, it wasn’t adding anything to our business, other than maybe a thousand cars a year.
“So as long as you take that disciplined and robust approach, and look at every car in isolation and say ‘what does it bring to the table for our business’, and there isn’t any tangible things it brings to our business, or our consumers or our dealers, then you have to question it. And that’s what we’ve been doing.” Nissan dropped the Pulsar hatch and the Micra micro car in April last year before killing off the Pulsar sedan and Altima last month.
While Mr Emery refused to put a timeline on when we can expect to see a new small or light car contender, he said that Nissan would not be absent from the sub-$25,000 market for too long.
“We have every intention of returning,” he said. “If you dig deep, what we’re saying is that we’re running a couple of those cars out earlier than we otherwise would, and therefore creating a gap between the old car and the new car that’s longer than people would like. Normally maybe there’s a three-month changeover in some cases depending on fuel programs and the launch of new cars. We’re saying do we want to persevere with these current cars, when they’re in difficult cycles in terms of their age versus the competition… up until the launch of the new cars, or do we concentrate on other things and make sure we get those cars right? “The fact that the cheapest new Nissan passenger car or SUV consumers can buy is around $25,000 and that’s the Juke, and that’s my only concern about the decision we’ve made. The entry point into the Nissan brand is now quite high, and will be quite high for a period of time. Whether it’s 18 months or whatever, it’s too early to predict.
“But we’ve been around for 50 years in Australia, we have a strong heritage, and I think the brand is robust and is strong enough to deal with that.
“And dealers still have some of these products either in stock or cars in company fleets, so we’ve probably got another six months of supply in limited opportunity. In the scale of a 50-year business, and long-term relationships with our consumers, I’d rather not be going through it, but I think it’s the right thing to do.
“We’re in a fallow period. Keeping one paddock empty while we letting it regenerate.” Despite the passenger-car cull – only the niche 370Z and GT-R sportscars remain, along with the full bandwidth of SUVs from Juke to Patrol as well as the Navara pick-up – Mr Emery said he was confident that Nissan would still have a comparatively strong year.
“This year is looking good,” he said.
“Obviously the numbers are going to be a bit different because of our withdrawal from the passenger-car market. It’s very hard to do apples for apples, but if you look at apples for apples, we expect to see most of our core products increase in volume this year versus last year. So X-Trail, Qashqai, Pathfinder and Navara – we see upside in all of those cars this year versus last year.
In the first four months of 2017, Nissan sales fell 14 per cent, from 21,407 in 2016 to 18,407 so far this year. Only the Navara 4x2 and GT-R improved, up 15 and 161 per cent respectively.
