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Nissan X-Trail
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The real tale of the tape though, is that at least 20% of the 500,000+ annual CRV/Rav-4/Triscape/Suzuki/Vue/Liberty buyers would choose the X-Trail.
That's what Nissan needs to wrap their marketing sense around.
I sent one, and it did not come back, so that must be good. If a few of us try to send a friendly message asking for the X-Trail, that might get their attention.
However... The fact that the X-Trail is offered in other countries along side the Xterra suggests that there are other reasons for them not bringing it here. Which brings us back to the possibility that is does not meet NA emissions or safety requirements. Nissan is not well known for excelling in either category with their production vehicles. I'd consider either one a decent possibility.
If they're refusing to bring it here, you can bet that there's something very crucial (passing emissions test, passing safety tests, etc...) that's making them refuse to bring over the X-Trail.
It would be so overwhelming that people would be forever scorned by Nissan because they were unable to get their hands on an X-Trail.
Candatwo - Not a bad idea, but I would think that Nissan could make more money per XTrail here in the US than in the other places we're seeing it. So if I only had 200,000 units per year, I'd sell them here in one big market, rather than in several smaller markets. Think of the advertising costs as just one example.
Personally, I'm not convinced that overwhelming demand would adversely affect sales either. I'm sure Honda has lost a few customers with the demand on the ODY and MDX, but it's been several years and people are still grabbing them up at MSRP. If that were going to have a signifcant negative effect, it would've happened all ready.
We begged for it to come to North America and Nissan responded they have it in Mexico now!).
Okay Nissan, no more fooling around.
Canada and the US now!
UG...LY.
Why waste your time...get a Jeep and move on.
Steve
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and not a true competitor for the CR-V, RAV-4, Forester etc.......the X-trail is available all over the world now........let's get it here!
Sure, they can put the X-Trail into Mexico, and that adds another 2,000 units to an existing Japanese X-Trail factory's output. Entering these incremental markets just let Nissan optimize production at full plant capacity. Factor in the X-Trail's popularity in its existing markets, and current build-capacity is probably pretty much maxed-out.
But commit to the US market, and they'd need some serious dedicated or near-dedicated plant capacity. You're not "just building a few more" when you enter the US. And Nissan doesn't have auto plants just lying around waiting to get turned on. They have to take existing capacity and phase out old programs to implement new ones. (Look at the Honda Odyssey... it's been out 3 years and they still can't build 'em fast enough. It's not that they don't want to, it's that they CAN'T").
I'm quite certain that Nissan would dearly love to have the X-Trail in the US. And, if honest, they'd probably admit that the X-Terra was the wrong choice (made 5 years ago) to answer the market's emerging love with smaller SUVs. It's now clear these vehicles are just the mid-sized wagons of this generation, and a car-based design is more desirable to the segment than truck-based. But that was not so clear 5 years ago.
Nissan has committed huge amounts of capital to tooling and vendors to produce X-Terras, and they can't just shut that program down on Friday and pump out X-Trails on Monday.
This is the reality of the car-building business. It is also a frustration we in the US suffer as consumers, because there are so many interesting cars in the world, but our market is so big, a manufacturer can't just "bring a few thousand in", so we miss out on a lot of variety.
I was in Lima, Peru recently and waded through car ads in the newspapers. They have more choice of manufacturers, models and designs there than we do here. But that's an incremental market, not a core market, so manufacturers can easily commit their entire model line there without being anything but a footnote for manufacturing.
That's just the way it is.
Why would Nissan start in the fringe markets? It's been obvious for a long time that the Xterra was going to attract the larger market share. The Xtrail hasn't been in production for that long. So why would Nissan introduce it in half a dozen markets? Take all of the regulations, tarrifs, shipping costs, and advertising costs then multiply it by the number of countries. I would think that they could sell the same number of Xtrails here in the USA and only have to deal with one set of these extra costs.
So for the first 6 to 12 months, the plant runs under capacity while manufacturing processes are refined, quality is assured, and the workforce trained. The line starts at say, 60% output the first month and ratchets up to 100% within a year.
Also during this first year, the model's sales performance becomes established. If it is a runaway hit, you just keep building to try to satisfy the markets you've already entered (Honda Odyssey). If it does "average", there may be a bit more capacity beyond what's needed to serve the markets you've already entered. This is when you go into incremental markets (Mexico or Latin America) to take up some slack capacity. You add small markets incrementally until consumption equals production, and production is at efficient (capacity) levels.
Nissan also no doubt excluded the US with the X-Trail to avoid cannibalizing the X-Terra... to which it was already committed (these are billion-dollar commitments I'm talking about here).
Nissan's paying the price (in lower sales volumes) by not having the X-Trail. But when the decision was made, the X-Terra was the only choice. There was no X-Trail in sight, and they could bring the X-Terra to market quickly and cheaply because the Frontier was already engineered and being built right here in the US. Get rid of the bed, add a backseat and a Frontier is an X-Terra. To wait for the X-Trail meant missing 2 years of selling anything into the Small SUV market. (Plus the Frontier is not a great seller, so there was probably extra plant capacity the mechanically-similar X-Terra could take up nicely).
I just get irritated with some of the whining on these boards that so-and-so-manufacturer is dumb because they don't sell such-and-such. The car business is a complex game where big money commitments are made years before they yield returns. And the plant capacity you have, where those plants are, and what you could build in them (you don't build Focus's on the same line or even in the same plant as Crown Vics) all dictate what a manufacturer can bring to market. It's not quite as easy as "Hey... let's go sell 125,000 X-Trails in the US next year".
One of the things I learned from a manufacturing engineer is the most important aspect to styling a door panel. It might have a beautiful curve, a racy line, or the best dent resistance known to man. But if they can't stack it on top of itself for shipping, it's 100% worthless.
I still have reservations about some of what you wrote. Nissan also offers the Xterra in Australia and New Zealand. Wouldn't the same conflict be a problem there?
Not necessarily... Its actually a good example of how markets are chosen to optimize the balance between production and sales.
Say in NZ/Aus they would sell 25,000 X-Trails if that's all they sold. Or 15,000 X-Terras if that's all they sold. Or in that market, selling both, they could sell 18,000 X-Trails and 11,000 X-Terras. (Model cannibalizing is never one-for-one). One of these strategic scenarios may be just the sales-volume mix that "works" to balance sales with production for one or both models.
So the bean counters (of which a car company has zillions) perform just these sorts of analyses to figure what gets sold where to match output. Factor in other cost variables associated with selling a model in a market like local advertising / marketing, parts distribution, transport costs, local certifications, tariffs, etc etc and the analysis gets quite complex.
But that's the basic process. Manipulate distribution strategies today to optimize profits on production commitments that were decided-upon some years ago when a model was given a green light.
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Ever hear people [non-permissible content removed] about why Ford does not sell the Mondeo here in the US (what used to be the Contour)? No one disputes its a great car, and would sell here. But they're selling like hotcakes in Europe and prior Contour experience in the US indicates we can't support domestic production at acceptable levels. It's a "tweener" where Europe can't build enough to supply us, but we can't economically build few enough here to satisfy this market. When demand in Europe wanes, then perhaps we'll see it here to take up the slack. Same idea.
Great discussion! Thanks for your thoughts.
The fact that the X-Trail is a very capable and competitive vehicle means that, while there may be some issues/obstacles to be overcome, the decision to bring it here should be a no-brainer.
Nissan's X-Terra / X-Trail dilemna was one of timing. They felt it was better to get SOMETHING (the X-Terra) into the $20K SUV segment sooner ('98, '99?) rather than wait until '01 or '02 for the X-Trail to be engineered. And going truck-based (like Jeep) instead of car-based (like CR-V, RAV-4, et al) was dictated by then-available designs (the Frontier existed, the X-Trail didn't) and North American manufacturing capability (They had a Frontier line running in Tennessee).
And don't forget that in the late 90s, Nissan was financially strapped, to say the least. Sure, Toyota could afford 5 Crossover/SUV programs... Nissan couldn't.
That it has turned out that the market much prefers car-based vehicles in this segment is just plain unfortunate (for Nissan and us as buyers).
I'm not trying to defend Nissan's strategies... merely explain them. I too love the Nissan brand and want a vehicle in this segment, and won't consider the X-Terra.
But Nissan did what they could, when they could; and now they, and we, must live with the results. Commitments were made, and have to be played out.
It's not always about selling the most cars... it's about making the most (or losing the least) money. All sorts of dynamics play into what we as consumers see (or not) in the showroom.
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Only Nissan knows the true numbers. We can only speculate as to capacity, cost of killing the X-Terra vs gain on sales of X-Trail, etc.
All in all, Nissan has totally missed the boat
But understand that if Nissan, who knows "the numbers", would make more or lose less money by having the X-Trail here, they would.
That they don't have it here and haven't announced plans to bring it here. So by definition that makes the X-Trail in the US a make-less or lose-more proposition for them (for now).
They won't get your $20K or mine this year, but they've decided they are better off, in the aggregate, without our business.
Currently, the X-Terra is selling about 4-6K per month. That's not too shabby. It's possible that they'd have to sell as many as 12-16K per month of the X-Trail to make the same profit. For comparison's sake, the Escape, CR-V, and Liberty have never really broken an average of 13-4K. Add yet another popular vehicle to the mix and everybody's piece of the pie gets smaller.
Development time on a typical vehicle, on average,
is what, 36 months give or take? Therefore, plans for the X-Trail must have been formulated in 1997.
So Nissan has had planty of time to get their act together.
The facts are correct but the conclusion flawed. Say in 1997 Nissan had decided X-Trail instead of X-Terra for the US. What would have happened?
1998 ZERO SUVs sold in the US in the $20K segment (there is no X-Terra and X-Trail not ready); Tennessee plant sits with idle capacity cuz Frontier not selling so well.
1999; ZERO SUVs sold in the US in the $20K segment (there is no X-Terra and X-Trail not ready); Tennessee plant sits with idle capacity cuz Frontier not selling so well.
2000; Some SUVs in the US in the $20K segment as X-Trail production and sales ramp up.
Catching up with the X-Trail to all those X-Terras NOT sold in '98 thru '00 for would be a big nut to crack for the X-Trail once it came out. How long to "earn it back" with the better X-Trail?? Years. Several years.
Plus, in '98 thru '00, Nissan was not exactly in a financial position to defer revenues and income to accomodate what may have been a better "long-term" decision. In 1999, analysts were publicly wondering if "long-term" and "Nissan" should be used in the same sentence. Without Renault, they were goners.
Anyway, I certainly agree with most of what's being said, however, I take exception to the fact that the X-Terra commitment is definitively preventing the X-trail from hitting our shores. The whole point of any company is to have successful products fund the development of new ones. Therefore, shouldn't Nissan start adding capacity at its Ten. plant or elsewhere to start the production of new crossover products? At any rate, the X-Terra is doomed, it's just a matter of time, while crossover SUVs are here to stay, therefore, the longer Nissan waits, the more they stand to lose in the long run. Furthermore, Nissan is starting to make a boatload of cash (actually more than their owners, but that's another story). They're releasing a few hot products here now, they got to be able to fund a new introduction in the US.
But for them to say so too far in advance of its release does them no good.
That's why manufacturers are typically very quiet about new re-designs and replacement models until just before their introduction. They don't want buyers deferring decisions they might make today to maybe-buy something the manufacturer is coming out with in 6 or 12 months.
Nissan has been very noisy with its Z and Infinity / Skyline derivitive years before introduction... because it won't take-away from current models and builds hype.
But look how quiet...
a) Toyota was with recent complete re-designs of Camry and Corrolla.
b) Honda is with this falls' new Accord, and was with the recent new CR-V.
c) Subaru is with this spring's Forester (I can't even find a picture, let alone any info).
Nissan, when it can, will fairly quietly bring in the X-Trail to compete in that segment while minimizing the "hit" to X-Terra as best it can. But I'll bet they announce it one month and it will be in showrooms a month or two later.
Hankr.....not saying that they shouldn't have introduced the X-terra.....as you pointed out, it was something they could get on the market right away to give them some kind of entry level player.
Just that they've been overly slow to react to the suv/crossover market and to get a credible entry(the X-Trail) to our market.
Steve
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