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Infiniti profits wane; dealers want product

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Old 02-17-06, 06:28 AM
  #31  
flipside909
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Originally Posted by G35_TX
LOL! And so is Lexus just rebadged Toyotas.
Hmmm the newest Lexus offerings aren't rebadged Toyotas... New GS, IS, LS and ES. You can check that out here: www.lexus.jp
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Old 02-17-06, 08:04 AM
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Originally Posted by flipside909
Hmmm the newest Lexus offerings aren't rebadged Toyotas... New GS, IS, LS and ES. You can check that out here: www.lexus.jp
I think he's referring to the rebadged Nissan thing. Infiniti's are definitely closer to Nissans than Lexus's are to Toyota's, so I guess its semantics but I wouldn't call either a rebadge. There is definitely some sharing going on with Infiniti which is typical of Ghosen. I think Infiniti will eventually go the way Lexus did by diverging the two lines even further, but right now they don't have the financial platform or brand prestige to do it. It all comes back to Lexus's getting it right in '89 and having a huge head start.

My definition of a rebadge would be something like the Acura EL/CSX, which is just a civic in the same market.
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Old 02-17-06, 08:23 AM
  #33  
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I don't care much about this rebadge thing at all, I would have bought the G35c & paid as much for a Nissan Skyline even if Infiniti didn't exist here. OTOH, I also sensed some sour grapes attitude about FWD ES, some people actually prefer them, there are not that many true sports sedans fans with consumers in general. Any luxury car makers would love to have a car like the ES selling that well if they can, FWD or not. Lexus will continue to sell them as long as the demand is high.

As for which brand is tier one, I don't really care that much either as far as choosing my cars, I really think it depends on the model. You can rank Audi as tier 2, but I consider owning an A8 more prestigious than most of the lower class cars offered by MB, BMW & Lexus, I would take an A8 over a 530, or even a 550, anytime for example. Some think a Jaguar is tier 3, but I consider a Jaguar XJ more prestigious than an Infinti Q45 . . .

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Old 02-17-06, 12:52 PM
  #34  
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Originally Posted by flipside909
Hmmm your numbers are a bit skewed. Did you forget which was the best selling foreign Luxury brand in the United States for several consecutive years now? You got it, Lexus.

Here's some food for thought:

http://www.toyota.com/about/news/cor...4-2-lexus.html

I don't care what the sale #'s are. In rankings the Lexus is compared to Infiniti to Audi to Acura. They aren't comparing Lexus to BMWs or Mercedes.
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Old 02-17-06, 02:24 PM
  #35  
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Originally Posted by G35_TX
These are my rankings:

Tier 1 - MB, BMW
Tier 2 - Lexus, Audi, Infiniti, Acura
Tier 3 - Cadillac, Jaguar
Tier 4 - Lincoln, Volvo

This is the way they are and currently are selling as.
IBTL.

Well, the Chairman of the Infiniti Dealer Advisory Board seems to have a different view from yours. Doesn't that tell you something?
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Old 02-17-06, 02:26 PM
  #36  
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Originally Posted by LexArazzo
Automotive News / February 13, 2006 - 6:00 am

Infiniti's popularity soared during the early part of this decade with hot new additions such as the G35 coupe and sedan, the FX 35/45 crossovers and the full-sized QX56 SUV.

Dealers reported record profits in 2003 and 2004, and the marque recorded more than 100,000 sales in this country for the first time in 2003. That year dealers sold 118,655 units. That number increased to 136,401 sales in 2005.

But amid higher inventory and a dearth of new product lately, dealer profitability has begun to wane.

Ed Lennon, a New Jersey dealer and chairman of the Infiniti Dealer Advisory Board, tells Staff Reporter Kathy Jackson that Infiniti dealers still are happy. But he asks: "Where is the new product?"

1) What's the situation with the important issue of return on sales?

We had dramatic growth in '03 and '04 and the highest profitability we had ever seen as a percent of sales. It was over 3 percent in '03 and '04, but we finished '05 under 3 percent. Our goal is to be at 4 percent. A Tier 1 luxury brand should have at least a 4 percent return on sales.

2) What happened last year to cause the return on sales to slip?

We had good sales, but our inventory grew. As inventory grows, gross profit drops.

3) Why did the inventory grow?

There's nothing wrong with our product; our product is great. But what our customers want to see is change. The only new product we had in '05 was the M. The G35 and the FX have been out for a few years.

When the product is new, that is the best opportunity for profitability. That is when people are willing to pay.

4) What new product is in the hopper?

The G35 came out in the middle of '02. We will get a complete upgrade of the G sedan this fall as an '07 model. But after the G35 - what's after that?

We don't know.

They say over the next three years new product will come to market, but they keep it very close. That frustrates us. The dealers want to know.

5) Has Infiniti been too slow bringing fresh new product to market?

I don't think anyone was sure how successful we would be with new product like the G35 and the FX. Now, I think everyone from (CEO) Carlos Ghosn to Jed Connelly (head of Nissan in the United States) is surprised how well we did do with it. Still, the cycle has been a little longer than dealers would like it to be.

There has been a lot of talk about whether the GTR sports car will be a Nissan or Infiniti when it goes on sale in this country. Have the Infiniti dealers been told anything about this?

They're keeping the product plans for the next three to five years very close, but Nissan North America has asked Nissan Motor Co. to make it an Infiniti. That's what they've told the dealer body. The dealer body is encouraged. It will be a low-volume car at about $50,000 or over. That is better suited to be an Infiniti than a Nissan.

6) Does Infiniti need a smaller sport wagon than the FX?

That's an area they're looking at and where we need to be. That's an area where we're not competing. The FX is more male oriented and not hitting a big part of the market.

7) What other holes are in the lineup?

We need a coupe with a retractable hardtop. We believe we need a halo car to solidify us as a luxury marque.

8) The GTR would not be a halo vehicle?

The GTR is pure muscle. A retractable coupe under $50,000 would appeal to many people.

9) Overall, are the dealers happy?

We saw our most profitable years ever in '03 and '04. Average profits per store were over $1 million. '05 was down a little bit, to about $800,000 to $1 million on average, but still a very good year. We have a very open forum with the factory right now.

The product is the only thing they're holding close. The dealers are happy, but we could do better if we had more product.

10) Infiniti stores are taking on a new look. How do the dealers feel about that?

For any businessman to buy into that, we have to feel good about the future. I think the dealer body is more than willing to do the retrofits because they believe we will be successful.

11) Do you think Infinitis are priced right?

Until we reach the top, we will have to be the value story. If anything, I'm concerned about price increases for the brand. We have to be the value franchise until we can say we're a Tier 1. We have not reached our goal until we can charge more.

12) Which brands do you consider to be Tier 1?

Mercedes, BMW and Lexus. We would like people to throw us in there as No. 4.


13) Are you satisfied with Infiniti marketing and advertising?

Since Jan Thompson (vice president of marketing) came on board in mid-2004, I've been very impressed. She knows what Tier 1 is.

We're starting to spend the money we need to spend so Tier 1 buyers can see us.

14) What are you doing to reach those Tier 1 buyers?

Three years ago we weren't spending enough money in any area. In '05, we did well with network TV. Moving forward, we will focus on the Internet

Did any of the pro-Nissan guys actually read this? Stop bickering and aruguing with members here please, we didn't say ANYTHING, your own BRAND said they were Tier 2.

Again.

YOUR OWN BRAND SAID THEY ARE TIER 2 AND LEXUS IS TIER 1.
 
Old 02-17-06, 03:26 PM
  #37  
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You're a UBB wizard!
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Old 02-17-06, 04:45 PM
  #38  
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Originally Posted by 1SICKLEX
Nissan never stated ANYWHERE, they are going to be RWD based only. The G20 and I30/35 sold poorly. Period. If either sold well and the public was receptive to it, they would CONTINUE to make them.

.
I completely agree with the Sentra-based G20 not appealing to the public. Infiniti brought it out in 1991, I think, sold it for a few years, dropped it, brought out a redesigned and more pedestrian version a few years later, sold it a few more years, and then dropped it for good. ( I liked the car, though......I test-drove one of the first ones ), However, I don't think that's quite the case with the I30/35. It was based on the FWD Altima / Maxima platform and actually sold quite well...for a while it was one of Infiniti's most popular products. In fact, it was an almost 100% rebadged Maxima with a reworked version of the Maxima 3.0 / 3.5L V6 for a little more power....and a lot ( and I mean a LOT ) nicer interior. And.....to be honest.......I think THAT is the true reason the car was discontinued. Look at the superb fit-and-finish inside and out that was on every I30 / 35 and then compare that to the much cheaper interiors and paint on the cars that followed it. Personally, ( though it cannot be proved ) I think the I35, despite good sales, simply fell victim to Carlos Ghosn's massive cost-cutting ax because it WAS such a nice car, used expensive quality materials, and, for his liking, just cost too much to produce, even though it shared a lot of things with the cheaper Maxima.

( When I bought my 2001 IS300, BTW, the I35 was one of the top 5 cars I considered. I actually liked its general interior better than the IS300's but was wowed by the IS300's chronometer gauges, chrome ball shifter, and bright yellow paint ).

Last edited by mmarshall; 02-17-06 at 04:54 PM.
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Old 02-17-06, 08:01 PM
  #39  
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Originally Posted by mmarshall
I completely agree with the Sentra-based G20 not appealing to the public. Infiniti brought it out in 1991, I think, sold it for a few years, dropped it, brought out a redesigned and more pedestrian version a few years later, sold it a few more years, and then dropped it for good. ( I liked the car, though......I test-drove one of the first ones ), However, I don't think that's quite the case with the I30/35. It was based on the FWD Altima / Maxima platform and actually sold quite well...for a while it was one of Infiniti's most popular products. In fact, it was an almost 100% rebadged Maxima with a reworked version of the Maxima 3.0 / 3.5L V6 for a little more power....and a lot ( and I mean a LOT ) nicer interior. And.....to be honest.......I think THAT is the true reason the car was discontinued. Look at the superb fit-and-finish inside and out that was on every I30 / 35 and then compare that to the much cheaper interiors and paint on the cars that followed it. Personally, ( though it cannot be proved ) I think the I35, despite good sales, simply fell victim to Carlos Ghosn's massive cost-cutting ax because it WAS such a nice car, used expensive quality materials, and, for his liking, just cost too much to produce, even though it shared a lot of things with the cheaper Maxima.

( When I bought my 2001 IS300, BTW, the I35 was one of the top 5 cars I considered. I actually liked its general interior better than the IS300's but was wowed by the IS300's chronometer gauges, chrome ball shifter, and bright yellow paint ).

I am glad you chimed in as we can actually conversate like adults and we both actually some something about these companies and the auto industry, unlike some of the fanboys in here.

The G20 was simply garbage to be badged a luxury anything. It is fine as a NIssan. To be a luxury badged car, it was horrible. 140hp I-4, decent plastics for a car but not a luxury car, nothing about it stood or stands out.

And it got discontinued, like pretty much every Infinitii at one time or another.

Then they brought it back, advertised it pretty well and

We got what, a 150hp I-4 with no luxury, no style, nothing.

And it got discontinued again.
(notice Lexus didn't or has NEVER offered a I-4 car or anything Corolla based)

The I35 was a good improvement, as the I30 was an avg attempt. They actually offered a T model (I 30) that could be had with a manual (correct me if I am wrong but I am sure this is right).
The I35 was a good looking car, the interior was nice (As was the Maxima of this era, a wonderful interior) and it was the best selling Infiniti, but compared to the ES, it wasn't a close sales race at all. It was reliable and had no glaring faults, outside of its badge.

It is very possible the ES wasn't hugely superior to the I35 in most aspects and clearly was short in acceleration but brand wise, people trust Lexus and buy Lexus. By the time the I35 was made to be a very solid car, the ES was now on a 10 year roll.

I think the I35 was gaining some speed but as you stated, with Ghosen's plan, the Maxima grew to be huge and an Inifniti badged version would be the same size as a M35/45. And this would confuse buyers. Honestly, they should have figured it out, they should have continued the I35 in some way or form.

On the other end, Lexus has proven to be the only luxury car maker than can have 2 different cars at the same price be successful, the IS and ES. No one else has that, everyone else has 1 car blending both. So looking at this, Nissan is probably doing the right thing and just offer a G35 instead of imitatiing Lexus and offering a G35/I35 in the segment.

Remember Mazda did in 1995, offer the $35,000 929 and the $35,000 Millinea S and well after 1 year, the 929 was discontinued. Its VERY tough to offer 2 cars at the same price in this price range.
 
Old 02-17-06, 08:12 PM
  #40  
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Originally Posted by 1SICKLEX
I am glad you chimed in as we can actually conversate like adults and we both actually some something about these companies and the auto industry, unlike some of the fanboys in here.

The G20 was simply garbage to be badged a luxury anything. It is fine as a NIssan. To be a luxury badged car, it was horrible. 140hp I-4, decent plastics for a car but not a luxury car, nothing about it stood or stands out.

And it got discontinued, like pretty much every Infinitii at one time or another.

Then they brought it back, advertised it pretty well and

We got what, a 150hp I-4 with no luxury, no style, nothing.

And it got discontinued again.
(notice Lexus didn't or has NEVER offered a I-4 car or anything Corolla based)

The I35 was a good improvement, as the I30 was an avg attempt. They actually offered a T model (I 30) that could be had with a manual (correct me if I am wrong but I am sure this is right).
The I35 was a good looking car, the interior was nice (As was the Maxima of this era, a wonderful interior) and it was the best selling Infiniti, but compared to the ES, it wasn't a close sales race at all. It was reliable and had no glaring faults, outside of its badge.

It is very possible the ES wasn't hugely superior to the I35 in most aspects and clearly was short in acceleration but brand wise, people trust Lexus and buy Lexus. By the time the I35 was made to be a very solid car, the ES was now on a 10 year roll.

I think the I35 was gaining some speed but as you stated, with Ghosen's plan, the Maxima grew to be huge and an Inifniti badged version would be the same size as a M35/45. And this would confuse buyers. Honestly, they should have figured it out, they should have continued the I35 in some way or form.

On the other end, Lexus has proven to be the only luxury car maker than can have 2 different cars at the same price be successful, the IS and ES. No one else has that, everyone else has 1 car blending both. So looking at this, Nissan is probably doing the right thing and just offer a G35 instead of imitatiing Lexus and offering a G35/I35 in the segment.

Remember Mazda did in 1995, offer the $35,000 929 and the $35,000 Millinea S and well after 1 year, the 929 was discontinued. Its VERY tough to offer 2 cars at the same price in this price range.
O.K ,Mike, ...Customer Services....
That's what Lexus is all about. You can shop around and compare all day long, but the Customer Services, the atmosphere of the dealership( since 1989 and improving), the employees, the friendliness and the products ifselft. All of those combine will make the customers feel more like at home. Lexus started all of these back in the 1989 and the customers love it, from roadside assistance, loaner car, waiting area, pick up/drop off for service and so on. Now, everybody have the same service, but when you're talking about luxury and services they will talk about Lexus.... Heah, Lexus Lane, Lexus parking at the ball park and Lexus this Lexus that...

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Old 02-17-06, 08:27 PM
  #41  
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One reason I wouldn't mind seeing the I35 come back is because it would allow the G35 to get a bit smaller. Not as small as the IS with its useless backseat, but making the G35 just a little smaller would help its agility and weight.

The reason that the G35 is noticeably bigger than the other RWD sedans in its class is because Infiniti is kind of trying to cover both bases.
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Old 02-17-06, 08:43 PM
  #42  
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There has been a bit of a lull in new Infiniti products, but it's not that bad. The last new intro (M35/45) has a been a great success in a tough segment.

And they should get quite a few new products in the next 3 years.

2006: New G sedan
2007: New G coupe
2007: CX
2007: GTR
2008: New FX
2008: G convertible
2008: Successor to the Q

I also think they should make an M coupe/convertible to go up against the 6 series, and an Infiniti version of the Pathfinder to go up against the GX470.
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Old 02-17-06, 09:38 PM
  #43  
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MB has FWD, just not in the US.

Why is Aston Martin listed in Tier 1? It doesn't even compare to any of these other brands. If you're going to list that, might as well go whole hog.

My tiers:
RR > Bentley, Maybach, Ferrari > Lamborghini
Maserati, Aston Martin
Porsche
MB > BMW
Lexus, HUMMER, Land Rover
Audi, Jaguar, Cadillac, Infiniti
Acura
Volvo, Lincoln
Saab
VW
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Old 02-17-06, 10:04 PM
  #44  
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Originally Posted by 1SICKLEX

The G20 was simply garbage to be badged a luxury anything. It is fine as a NIssan. To be a luxury badged car, it was horrible.And it got discontinued, like pretty much every Infinitii at one time or another.
Then they brought it back, advertised it pretty well and
We got what, a 150hp I-4 with no luxury, no style, nothing.
And it got discontinued again.
(notice Lexus didn't or has NEVER offered a I-4 car or anything Corolla based)

The I35 was a good improvement, as the I30 was an avg attempt. They actually offered a T model (I 30) that could be had with a manual (correct me if I am wrong but I am sure this is right).
The I35 was a good looking car, the interior was nice (As was the Maxima of this era, a wonderful interior) and it was the best selling Infiniti, but compared to the ES, it wasn't a close sales race at all. It was reliable and had no glaring faults, outside of its badge.

I think the I35 was gaining some speed but as you stated, with Ghosen's plan, the Maxima grew to be huge and an Inifniti badged version would be the same size as a M35/45. And this would confuse buyers. Honestly, they should have figured it out, they should have continued the I35 in some way or form.

Remember Mazda did in 1995, offer the $35,000 929 and the $35,000 Millinea S and well after 1 year, the 929 was discontinued. Its VERY tough to offer 2 cars at the same price in this price range.

Yeah I couldnt for the life of me figure out why anyone would buy the G20. If I recall correctly, you were offered a lot more in a comparably priced Maxima than a G20. A co worker of mine had one. Theres nothing to like about that car honestly.

Yes the I30 was available in a 5 speed. But only for about 3-4 years. 95-97 or 98. It was an okay car in my opinion, but even that car was all about the badge as it really didnt offer anything over my same model year Max. Just a different front and rear end and a slightly different center stack(though I find it to be incredibly ugly). The amount of parts that are interchangeable between the two models is REDICULOUS!! Oh and they also came with an LSD on the 5-speed.

I still think they should have continued the I35. After the 02 update it became a really classy car. I loved it. But once again, the similarities between the two(I35 and Maxima) is startling.

And I thought the Milenia was actually a replacement for the 929?? The 929 was on the market for about 4 years b4 it. Actaully the Millenia was suppose to be the first model in Mazdas upscale division that never happened.
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Old 02-17-06, 10:05 PM
  #45  
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Originally Posted by 1SICKLEX
Did any of the pro-Nissan guys actually read this? Stop bickering and aruguing with members here please, we didn't say ANYTHING, your own BRAND said they were Tier 2.

Again.

YOUR OWN BRAND SAID THEY ARE TIER 2 AND LEXUS IS TIER 1.
My point exactly. Game Over!
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