Nissan Confirms Plans for Entry-Level Cars

GENEVA – Nissan confirms it will produce low-cost cars in several emerging markets.

“We make no secret of the fact that it is our intention to offer cars at the price-entry level, as we call it,” Andy Palmer, executive vice president-global product planning, tells journalists during a roundtable discussion at the auto show here this week.

However, he remains tight-lipped regarding details on timing or the scope of the investment. “We will make some announcements about that in the next few weeks,” Palmer promises.

Media reports have suggested Nissan will revive the Datsun name for the new entry-level brand. Nissan originally badged vehicles as Datsuns until retiring the name in the mid-1980s.

“That’s an interesting idea, isn’t it?” the executive says. “As for the brand, wait and see.”

He says there is a market opportunity “in the emerging world, (where) people who are coming from motorcycles have very few options today.

“I guess the most obvious option is something like the ($3,000-$4,000) Tata Nano, but there are also steps in between.”

Palmer says he avoids the word “cheap,” because customers are not looking to buy cheap cars. “They are looking for good value for (the) money, good styling, good quality, but they can only afford a certain level.

“Certainly, it is very much our intention to have cars in that segment. It is our ambition to democratize quality.”

The project may include a variety of vehicles covering a number of segments, depending on the country where they will be manufactured. Russia, India and Indonesia appear to be among possible production locations.

“In some cases, Russia would certainly be an interesting country for these kinds of vehicles, but there already is a great entry possibility with the Lada range,” Palmer says.

There are rumblings of a possible entry-level car for Russia based on the platform of theLada Granta, manufactured by Renault-Nissan partner AvtoVAZ.

Nissan’s entry models won’t be intended as world cars. “In my mind, to get to the price point that is demanded, we would not do this as a world car,” Palmer says.

Such vehicles force compromises, he says, because customers’ tastes are very different from market to market. “So if you want to optimize costs, you pretty much have to make it quite specific to those kinds of markets.”

That doesn’t mean it would be impossible to sell an Indian car in Indonesia, he adds. “But you would still need to have some degree of difference.

“But an Indian car in Russia? I don’t think so. An Indian car in China? I don’t think so. Our approach would tend to be more market by market.”

Volumes are unclear.

“But bear in mind the population that today can’t afford a motorcar but could afford a motorcar if you put in the right price point, is simply enormous,” Palmer says.