Market Reports ,

INFINITI Cars Australia must show its global headquarters that it can grow volume in 2018, after a key local executive revealed that a dip in sales in 2017 and for the first quarter of this year would naturally cause “alarm bells” to be raised internally.

Nissan Australia managing director Stephen Lester

Speaking for Infiniti Cars Australia managing director Chang-hwan (CH) Lee at the national media launch of the QX80 late last month, Nissan Australia managing director Stephen Lester insisted that the Japanese luxury brand was committed to this market, but changes needed to be made to the business.

There is no doubt that 2017 was a tough year in the luxury segment overall, it was also a period of transition for us, and when we look at how the year has started it has certainly not been ideal from our standpoint,” he explained.

There is no doubt that any time, in any market around the world, when you see sales and ergo revenue dip that that sends alarm bells off and people get concerned. And so there has been a lot of work done and some preparation around countermeasures before that, and the work that we have to do to support growing the business again.

I’m not going to be able to commit to some of those specifics within our plan, but what I can say is that we’re evaluating absolutely everything we’re doing on the Infiniti side. Part of that is certainly a result of going backwards at the end of the year, and how to ‘course correct’ and countermeasure away from repeating that result. So this is all in the works and all in the plans, and we have to investigate every opportunity that there is.

There is a lot around the business that we have to look at in our own house … and for us it’s about getting back to basics and making sure that our strategy is properly exploited.”

While Mr Lester declined to specify what Infiniti Cars Australia would enact to reverse the sales decline, he also refused to comment on the reduction in dealerships nationwide including the closure of Infiniti Centre Brisbane and Infiniti Centre Sydney (see separate story).

Infiniti QX80

However, he further insisted that “there is no question there is commitment to the Infiniti brand (in Australia)” and that it would not be removed due to low sales growth as General Motors infamously did with Opel in 2013.

Asked whether there was a sales figure required for Infiniti’s Hong Kong headquarters to see the brand as successful in Australia, however, Mr Lester replied: “I wouldn’t say that it depends on any specific number, we need to achieve growth on every single year.

When you are relatively small or low in volume, that growth is much easier from the standpoint that you’re coming from a smaller base so the percentages can look more significant than some of the competitors.

Infiniti QX50

But growing every single year is the paramount focus of the business, that is the single universal key. From that we will grow a very significant business and brand in this country.

I am really confident with the product news, here today with the QX80 and the optimism around the arrival of QX50 and solidifying our business overall in the country and the direction moving forward, we’ll be in a much better position than the outgoing 10 months of the year here (and) in a position to get back to the growth we’ve been having for six years now.”

Despite the QX50 medium SUV – Infiniti’s great sales hope – now arriving on local shores around mid-2019, Mr Lester said he believed Infiniti could finish 2018 with higher volume than last year.

According to official VFACTS figures, sales fell 3.8 per cent in 2017 from 807 to 776 in, while in the first quarter of 2018 it fell 63.5 per cent to just 104 units, down from 285 in the first three months of 2017.

Mr Lester in part blamed dwindling QX70 large SUV stock for the decline, however while it was down 85.4 per cent from 89 to 13 sales for the first three months of the year, others models suffered sales slides as well.

The Q70 large sedan fell 75.0 per cent from eight to two sales, the Q30/QX30 small hatchback and crossover dipped 73.7 per cent from 76 to 20 sales and the Q60 sportscar lost 71.4 per cent from 28 to eight sales

Infiniti Q50

The Q50 medium sedan declined by 28.1 per cent from 64 to 46 sales and the QX80 upper-large SUV has lost a quarter of its sales, down from 20 to 15 units.

For Infiniti specifically, I absolutely forecast a bounce back and a rebound,” Mr Lester said.

I think the absence of QX70 (stock) has started to contribute to that (volume dip) but I think overall you can see a recession of the overall luxury market that has made business a little bit tougher in totality.

It’s hard to compete with the established brands, however I think that being a brand that around the world is known for its innovation and technology and will bring more and more products here, we’ll be in a better position to challenge.

Infiniti Q30

Whether the market cooperates on a full year basis is yet to be determined, but I don’t think based on our current level of share, that we operate in the exact same circumstances as all of the other competitors, which is a little bit different. So while a forecaster could read that the market will move backwards a little bit, it’s not a reason for us not to grow given that we are coming from a small base.”

The great hope for Infiniti, however, comes with the QX50 medium SUV next year, meaning a core year of sales improvement will be left until 2019.

There’s no denying that we’re not playing in the largest segment in the luxury business, and therefore getting into that segment is a huge driver for growth opportunities going forward,” Mr Lester added.

By Daniel DeGasperi

Manheim
Gumtree