The message to dealers was that Nissan would pay the floorplan so it would not cost the dealers anything more.

However, GoAutoNews Premium understands there is still a requirement to meet strict targets.

Failure to meet the targets would remove the offer of Nissan to pay the floorplan costs.

Dealers raised the issue with GoAutoNews Premium earlier this month but more were vocal last week at the AADA conference, where one said the action by Nissan Australia to force vehicles on dealers when the market was so tight was “appalling”.

“Basically we have been told we must retain 45 days of stock to get the free floorplan each month,” one dealer told us.

“That is like being told to take (an extra vehicle) for every car we retail. It’s appalling and shows a lack of respect by Nissan to its dealer network.”

Another dealer told GoAutoNews Premium that he still had stock left over from the last time Nissan raised the stock level. This was in February, with the impetus being to boost wholesale sales before the end of the Japanese financial year on March 31.

The dealer said he had no choice but to abide by Nissan’s request because it was part of the franchise agreement, but another dealer said legal advice was that it was not mandatory to accept Nissan’s demand.

Adding more stock to a dealer’s inventory is not new in the Australian car market and is used by many OEMs to spur sales.

It is also understood that funds for the floorplan cost would come from Nissan Australia’s marketing budget, indicating the dealers would not be helped by any merchandising activities to help move the extra stock.

The demand from Nissan comes as the Australian car market continues to slide and increased costs – including the doubling of state government land tax charges in some areas of Victoria – hit the industry.

Nissan performed well in August 2019 compared with the same month last year, with a 2.2 per cent rise in sales. But year-to-date sales are down 12.3 per cent on 2018, running deeper than the overall market’s 8.0 per cent downturn.

The brand also lifted market share in August to 5.3 per cent after averaging 4.7 per cent share for the year to date.

GoAutoNews Premium has been told notices from Nissan Australia – signed by director of sales Ian Moreillon and director of customer experience and dealer network Craig Clarke – have been sent to dealers informing them of the need to take the stock.

The letters, dated September 2019, detail the stockholding of individual dealerships and their requirement under the agreement, outlining “a gap” of a specific number of vehicles.

“Nissan would like to take this opportunity to remind you of your obligations to be compliant with all policies and procedures as a material condition of your dealer agreement,” the letter states.

“Nissan requests that you take immediate action to regain compliance…”

It also spells out how a recent financial services bulletin from the car-maker shows how dealers can access Nissan Financial Services Australia’s floorplan assistance program that provides floorplan credit for up to 90 days “providing your dealership remains compliant with the required stockholding as at close of business on the last day of each month”.

Dealers are then requested to meet the compliance by the end of September and sign and return an acknowledgement (attached to the letter) to the regional general manager “as a priority”.

Nissan Australia was approached for comment and said: “We don’t discuss the specific details of commercial operations with our dealer partners.”

By Neil Dowling