Welcome to the Daily 5 report for Monday, Nov. 3.
Nissan Motor Co., a troubled automaker with a new CEO trying to turn things around, can't seem to escape its addiction to stair-step targets forced on its U.S. dealerships.
As we've documented in our coverage over the last several years, Nissan has drawn the ire of its dealer network with the controversial tactic that retail experts have slammed.
Urvaksh Karkaria reports a new round of criticism from Nissan dealers.
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"Nissan ... is taking us right back to unhealthy business practices," said one of the retailers. "To collect on volume bonuses, dealers are advertising incredibly low prices, which can damage store profitability and brand equity."
The dealer told Karkaria his fourth-quarter sales target is 40 percent higher than his volume in the same period last year.
Another retailer said his sales goal is 25 percent higher than a year ago, Karkaria wrote.
"Nissan has never had a transparent method of calculating objectives, so the majority of dealers don't have faith or trust in the factory giving us understandable and attainable numbers," the person said.
On the other hand, Nissan defends the practice as tough medicine for tough times as it tries to stimulate new sales. Nissan U.S. sales and marketing chief Michael Soutter dismissed the criticism that the company's volume expectations are unrealistic, saying they mirror the brand's retail share, our story says.
"We're selling at 5.1 percent, and we're setting the targets at 5.1 percent," Soutter told Automotive News. "Anytime there's an objective, you're going to have some people that are not happy," he said. "I don't want to minimize the frustration that some dealers face. I would like to see all the dealers stretching themselves and getting a 5 percent share or better."
In other news, the Nexperia chip crisis appeared to be ending over the weekend with stories reporting that the new U.S.-China trade deal would ensure Nexperia's chips start moving again.
Finally, Carly Schaffner is reporting that Kia will not be adding the compact EV4 sedan to its U.S. lineup early next year as initially planned.
A spokesperson for the South Korean automaker confirmed that the release of the small electric vehicle will be delayed until further notice, citing "changing market conditions for EVs," Schaffner wrote.
That's it for now. Have a great rest of your day. If you want to view this story in your browser, click here.
— Philip Nussel, online editor
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