Nissan Motor Co Ltd (ADR) Infiniti to Make a Comeback in China

Nissan Motor's premium brand is planning a comeback.

Nissan Motor Co Ltd (ADR) Infiniti to Make a Comeback in China

By: Faraz Haleem Published:
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Nissan Motor’s premium brand is planning a comeback

Nissan Motor Co Ltd.’s (OTCMKTS:NSANY) premium Infiniti brand is all set to make a comeback in the world’s biggest auto market, where its sales plummeted, following the loss of its country head.

“We are looking at huge potential, still, for Infiniti” in China, said Infiniti President Roland Krueger. Mr. Krueger also seemed optimistic about the company’s performance in the Chinese auto market. He said that the brand would gain momentum in the country as the company will introduce the new QX30 crossover later this year and resolve supply and production issues.

In the past few years, the auto market dynamics have changed as the demand for Sport Utility Vehicles (SUV) and crossover has been rising. The companies with SUV models in Chinese market are maintaining their market shares and recording growth despite slump in the economy.

The sale of luxury vehicles in China over the past few months has also been growing despite the economic slump. Cadillac sales in June soared nearly 34% year-over-year (YoY) to 9,552 units. Daimler AG’s Mercedes-Benz also recorded a significant 32% growth in comparable period of last year to 229,137 deliveries driven by E-class.

According to analysts, sale of SUVs is likely to remain robust as the Chinese families, who are planning their second child, are keen to buy big vehicles. The demand for fuel-efficient and small-engine capacity SUVs has been trending in the country due to greater monetary benefit especially from tax cut.

Infiniti, headquartered in Hong Kong in 2012, has to make efforts in China to perform better and entice users. Nissan’s premium brand got a hit, following the departure of Daniel Kirchert, who doubled the sales before his joining to the Tencent-backed EV startup.

The company has also been suffering due to weak brand power and new vehicles. In the first half of the year (1HFY16), Infiniti sold 18,600 vehicles, reflecting a 2% YoY drop despite its competitors' recorded incline in sales.