Faced with evaporating profits, Nissan Motor Co. will take the pruning shears to a global lineup that includes more than 60 nameplates across the Nissan, Infiniti and Datsun brands.
The Japanese automaker last week said it will trim its product portfolio by at least 10 per cent by March 31, 2022. It's part of a sweeping renovation that also involves cuts in work force and production capacity.
The product reductions will focus mainly on small vehicles, including emerging-market Datsun models, Nissan Motor Co. CEO Hiroto Saikawa said last week at a press conference.
Nissan could also shrink the options and packages offered on its vehicles. The numerous variations are proving expensive and complicated as marketing and incentive supports are strained.
Dave Wright, dealer principal at Dave Wright Nissan-Subaru in Hiawatha, Iowa, agrees that Nissan's lineup is cluttered with too many option packages and trim levels, making it complicated and expensive for retailers to stock their lots.
"If you make a bet on what packages you think a customer is going to want, and they don't want 'em, that car sits and sits and sits," Wright said.
Nissan's compact cars are low-hanging fruit for consolidation in a market that has lost much of its enthusiasm for sedans.
"They've just got too many sedans for this market," said Jeff Schuster, president of global forecasting at LMC Automotive. "I don't see them all go, but I could see consolidation if Nissan looks to the U.S. for the cuts."
Analysts see the Versa subcompact and Sentra compact as redundant in a shrinking sector. Both cars are favorites of rental fleets, a market Nissan historically leaned on to grab market share. Nissan's latest business reboot, however, has it steering away from profit-sapping rental-fleet customers.