Why didn't the Japanese luxury brand joint venture car company that first entered the Chinese market drink the soup?
Photo/Visual China
Text | Caijing reporter Li Haoyin
Edit | Shi Zhiliang
Since the 35-hour lightning termination of Wang Lihong on Weibo hot search, Infiniti has once again made headlines in the industry.
On January 5, Dongfeng Motor Co., Ltd. (hereinafter referred to as "Dongfeng Limited") officially announced that Dongfeng Infiniti will be included in dongfeng Nissan's management system as an independent business headquarters. Since then, Dongfeng Infiniti has become the third brand owned by Dongfeng Nissan after Nissan and Venucia.
In the official press release, it was explained that this move will help Infiniti use Dongfeng's limited full-value chain advantages to explore new mobility business models, promote the transformation of the new four modernizations of automobiles, and further explore opportunities in the luxury car market. But some analysts see this as Infiniti's strategic contraction.
Launching new products and adjusting the organizational system, can Infiniti, which started early in the morning, win back the glory of a luxury brand?
Got up early, but didn't drink the soup well
Infiniti was the first Japanese luxury brand to be jointly produced in China.
Infiniti was born in 1989. In 2005, Nissan listed China as Infiniti's market of gravity under its Value Added Program. The following year, imported Infiniti models entered the Chinese market. In 2007, Infiniti unveiled and explained its product concept in China, and in 2012, it moved its headquarters to Hong Kong, China, to begin the process of brand independence and internationalization.
In 2014, Dongfeng and Nissan established Dongfeng Infiniti Automobile Co., Ltd., allowing it to start domestic production before its Japanese luxury brand rivals Lexus and Acura. At that time, this move was highly evaluated in the industry, and it was generally believed that both sides valued the Chinese market, and based on the good development and sales performance of Dongfeng Nissan in China, it could get the early benefits of China's automobile consumption upgrade.
Infiniti once made great strides, launching two models in the first two years of localization, that is, in November 2014 and March 2015. In the first year of localization in 2014, Infiniti's sales increased to 30,000 vehicles, ushering in the first growth peak. In 2015, it continued to grow by 33%, the second fastest growth rate of luxury car brands.
Unfortunately, Infiniti's localization process was not fast, and no new models were launched in the following six years. During this period, second-tier luxury brands Volvo and Cadillac increased product investment by virtue of their production advantages in China; the sales of Lexus, which has been imported, have gradually risen, and Infiniti, which has been laid out early, has not hitched a ride.
According to the latest sales data released by the Association, Dongfeng Infiniti's wholesale sales in November were 1258 units, down 61.1% year-on-year, and the cumulative sales from January to November were 7691 units, down 64.7% year-on-year compared with 22,000 units in 2020.
As the world's largest automobile consumer market, even if the global economic environment is complex and the market is under pressure, car companies are still actively laying out and seizing this market that still has an increase.
Dongfeng Motor said in the announcement that in 2022, Infiniti will still carry out a new round of product introduction led by the new QX60 to further meet the needs of Chinese consumers for luxury brands.
Infiniti is looking forward to the new model. To this end, Wang Lihong, who was regarded as a perfect idol at that time, was selected as a brand endorsement, and as soon as it was listed, due to the closeness of the spokesperson and the target sales group, the feedback effect was good. But unexpectedly, due to Wang Lihong's "collapsed house", just 35 hours later, Infiniti terminated his contract. It is regarded as a decisive Infiniti, so it is pushed by netizens on the hot search of Sina Weibo.
There are early signs of integration
There are early signs of consolidation.
As early as last July, the industry rumored that Infiniti was going to return to Nissan; at the end of last year, it was rumored that Infiniti's China headquarters had been relocated. Previously, the above news was denied by the relevant parties.
Relevant people of Dongfeng Limited explained to the "Finance" reporter that in the past, Dongfeng Infiniti was a wholly-owned subsidiary of Dongfeng Limited, and now it is the headquarters of Dongfeng Nissan' business. On the whole, the impact is not large, its own business enterprises, research and development, manufacturing are in Dongfeng Nissan, the so-called merger is only sales, marketing, finance, administration and other related departments. This integration helps to achieve resource synergy.
Sales volume is one of the main factors, Zhang Xiang, a researcher at the Automotive Industry Innovation Research Center of the North China University of Technology, told caijing reporters that if Infiniti operates independently, the cost is higher, and the existing sales volume is difficult to share and turn into a business unit, which will help to share and share resources, significantly share existing costs, and maintain existing production operations.
According to Dongfeng Infiniti's official website, it currently has six products on sale, including Q50L, QX50, Q60, QX60, Q70L and a new generation of QX60. According to the data, Infiniti sold only 25,700 vehicles in 2020, which is not satisfactory.
A person close to Dongfeng Nissan told the "Finance" reporter that it also received accurate news two days ago, and is still doing internal details confirmation and communication.
In short, Infiniti as an independent business unit, the business is still independent, management is integrated. For example, the above-mentioned person said that Dongfeng Nissan has strong marketing capabilities and can help Infiniti.
Infiniti's counterparts did not comment.
It is worth mentioning that as early as June 2020, Nissan Motor just released the "Nissan Next" enterprise transformation plan. The transformation plan mainly includes several points: the global market contraction, focusing on China, North America, and Japan.
At that time, Infiniti's chief operating officer, Ashwani Gupta, said that Infiniti would transform into a new brand "NISSAN Plus", which was scheduled to start promoting in 2023.
This move is seen by the industry as Infiniti is expected to use more common technologies, platforms, powertrains, and factories with Nissan to improve efficiency. Although this move is seen by the outside world as a risk of diluting brand equity, with the help of strategic adjustment, so that enterprises can better survive, target the target market, in the face of the huge automobile consumer market, there may still be opportunities.
January 9, 2021