Current market conditions are challenging for Nissan sellers. As reported by Automotive News, the company’s profitability during the first half of 2024 dropped to its lowest level in 15 years. With more customers gravitating towards rival brands, Nissan is steadily losing market share, resulting in 38 percent of U.S. dealers reporting financial losses. This downturn has led to the closure of eight Nissan dealerships in the U.S. this year alone.
“Dealers are facing unprecedented challenges,” an industry source informed Auto News. “We urgently need volume, and we need it quickly.”
Five unaffiliated dealerships surveyed by Auto News revealed that the volume Nissan requires is being absorbed by Honda, Toyota, and Hyundai. A dealer explained that insufficient new car sales hinder trade-ins, which are crucial for profitability channels including finance, service, and parts. Reports indicate that the average net profit for Nissan franchises plummeted by 70 percent in the first half of 2024 compared to the same period last year.
A look at Nissan’s lineup reveals why customers are venturing towards rival automakers. Many of Nissan’s models in key segments such as midsize crossovers and budget-friendly sedans are aging compared to competitor offerings. Vehicles like the Nissan Murano and Altima seem outdated next to newer models like the Hyundai Santa Fe and Honda Accord.
Additionally, Nissan struggles with a limited selection of electrified options. While the Nissan Leaf and Ariya exist, the Leaf is considered outdated and still uses the old CHAdeMO charging port. The Ariya, on the other hand, starts at over $40,000, making it less accessible. Moreover, there are no hybrid or plug-in hybrid offerings in the U.S. With the growing demand for electric vehicles, partly driven by appealing incentives, Nissan’s reluctance to expand its electric lineup is negatively impacting its sales.
“Hybrid is the new EV, and manufacturers that are ready for this trend are gaining market share while those who are not are losing ground,” noted Karl Brauer, an executive analyst at iSeeCars.
Nonetheless, there is a potential turnaround for Nissan on the horizon. The company plans to introduce more electrified options in the coming years, thanks to its collaboration with Mitsubishi, including a plug-in hybrid version of the next-generation Rogue slated for 2027. In the shorter term, the newly updated Nissan Kicks for 2025 features a stylish redesign, advanced technology, and the addition of all-wheel drive. Priced at an accessible $23,220, it is expected to appeal to younger consumers.
Furthermore, Nissan aims to revise its marketing approach by reducing celebrity appearances in commercials and focusing more on showcasing the features of its vehicles. The automaker has expressed confidence that with the introduction of new products and a marketing revamp, sales are projected to increase by 20% by the end of the fiscal year in March 2025.
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