Nissan Has A Rogue Problem — Thousands Of Unsold SUVs Trouble Automaker

Nissan overestimated how many 2023 Rogues it could sell and is offering dealer incentives to shift around 24,000 old models

                                        https://www.carscoops.com/author/sam-d-smith/                                    
 Nissan Has A Rogue Problem — Thousands Of Unsold SUVs Trouble Automaker

by Sam D. Smith

March 15, 2024 at 20:38

 Nissan Has A Rogue Problem — Thousands Of Unsold SUVs Trouble Automaker

Nissan cannot seem to shift Rogues fast enough, with 2023 models still clogging up dealer lots nearly a quarter of the way into 2024. And now that 2024 model year Rogues have begun delivery, Nissan is going old-school in its tactics as it tries to shift a backlog that could amount to as many as 24,000 unsold ’23 MY models.

Good Ol’ Incentives

A memo sent to Nissan dealers last week offers an incentive of $1,000 for each 2023 Rogue sold. However, this offer is strictly contingent on each dealer hitting their own individual targets for the SUV, but both 2023 and 2024 models can count towards this.

Nissan hopes that this volume-based retail program will kick-start sales of the Rogue, the Japanese carmaker’s best-selling model in the U.S. It will likely lead to dealers setting their own discounts on the older model.

However, according to a report from Automotive News, slashing prices on older inventory may have a sting in the tail for dealers. The discounted ’23 models put greater price pressure on the 2024 Rogue. This is especially true as the new model year Rogue is merely a refresh, not a redesigned model. In addition, the price cuts will also have a knock-on effect on the Rogue’s residuals.

Throw-Back To Times Best Forgotten

 Nissan Has A Rogue Problem — Thousands Of Unsold SUVs Trouble Automaker

It’s the first time Nissan has offered such a large, volume-based sales program since Covid. Meanwhile, Judy Wheeler, Division Vice President – Nissan Sales and Regional Operations at Nissan North America, admitted that the automaker may have been slightly optimistic over how many Rogues they could sell.

“We probably were uber-aggressive on what we took in production,” Wheeler said, speaking to Automotive News. “The market’s changed. Hybrid [vehicles have] higher demand, quicker than expected.”

Despite the oversupply, Rogues accounted for a third of the brand’s total volume last year, with a 46 percent increase in numbers from 2022. A separate Nissan spokesperson confirmed that the company does not intend to make such bonus programs a regular occurrence.

Although Nissan may not be looking at making such an incentive scheme a long-term fixture, some dealers have their doubts over whether it won’t be extended beyond the end of March. This may be seen as a flashback to the promotional tactics employed during the Carlos Ghosn years, when the company pursued increasing market share.

During those years, Nissan’s aggressive dealer volume bonus program was accused of devaluing the brand, while also pitting Nissan dealerships against each other.

What Do The Dealers Think?

 Nissan Has A Rogue Problem — Thousands Of Unsold SUVs Trouble Automaker

Other dealers interviewed were more enthused by the new scheme, with one retailer saying that with $1,000 being given back for each car, they’d be able to sell another 60–75 vehicles per month. The higher-volume retailer also expects to move most of their 2023 Rogues by the end of the month.

Regardless, the age of Nissan’s supply has increased to 112 days, which is some 40 percent higher than the industry average. Another tactic used to shift old stock is Nissan’s introduction of a seven-year, 3.9 percent annual financing incentive.

This, too, has been criticized by some dealers, with the risk of a reduction in customer retention. The concern is on long-term custom. Not only will buyers on long-term leases be less likely to trade in for a newer model until the longer leases are up, but they will be less likely to continue funneling cash towards dealerships in the way of maintenance — because the older a car gets, the less likely it is to be taken to the dealer for servicing.

 Nissan Has A Rogue Problem — Thousands Of Unsold SUVs Trouble Automaker

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