"Relegation" is assigned to Dongfeng Nissan, can Infiniti turn around in China?

Infiniti, a second-tier luxury brand that has been hotly discussed at the end of 2021 because of the "Wang Lihong Endorsement Incident", has recently ushered in a new planning adjustment.

On January 5, Dongfeng Motor Co., Ltd. (DFL) announced that Dongfeng Infiniti will be included in Dongfeng Nissan's management system as an independent business headquarters, and Infiniti will become the third brand of Dongfeng Nissan together with Nissan and Venucia.

The inclusion of Dongfeng Nissan's management system means that Dongfeng Infiniti will no longer be an independent division of Dongfeng Motor Co., Ltd. In addition, Dongfeng Motor Co., Ltd. stressed that dongfeng Infiniti's transformation has begun on January 1, 2022.

Dongfeng limited synergy integration

According to the data, Dongfeng Motor Co., Ltd. was established on June 9, 2003, headquartered in Wuhan, is a joint venture formed by the strategic cooperation between Dongfeng Motor Group Co., Ltd. and Nissan Motor Company, and is also the only full-series cooperation project of Nissan overseas. The registered capital of the company is 16.7 billion yuan, and both parties have 50% of the shares. The current chairman Zhu Yanfeng, president Yamazaki Shohei.

Dongfeng Motor Co., Ltd. once had Dongfeng Nissan Passenger Car Company, Dongfeng Venucia Motor Company, Dongfeng Infiniti Automobile Co., Ltd., Dongfeng Motor Co., Ltd., Zhengzhou Nissan Automobile Co., Ltd., Dongfeng Motor Parts (Group) Co., Ltd., dongfeng Motor Co., Ltd. Equipment Company seven major divisions. The main production bases are distributed in Hubei, Guangdong, Henan, Liaoning, Jiangsu and other places.

On December 28, 2020, Dongfeng Motor Co., Ltd. announced that in order to further improve the company's operating quality and promote the coordinated development of its businesses, it was decided to integrate Dongfeng Nissan Passenger Car Company and Dongfeng Venucia Motor Company, as well as Dongfeng Motor Co., Ltd. Equipment Company and Dongfeng Auto Parts (Group) Co., Ltd. According to the announcement, Dongfeng Venucia Company will be included in the management of Dongfeng Nissan, and will be changed from an independent brand to the second brand of Dongfeng Nissan Passenger Vehicle Company.

After the integration, Dongfeng Limited has only five major business divisions, namely Dongfeng Nissan Passenger Vehicle Company, Dongfeng Infiniti Automobile Co., Ltd., Dongfeng Motor Co., Ltd., Zhengzhou Nissan Automobile Co., Ltd. and Dongfeng Motor Parts (Group) Co., Ltd.

The inclusion of Dongfeng Infiniti in the management system of Dongfeng Nissan is consistent with the spirit of Dongfeng Motor Co., Ltd. to promote the development of strategic undertakings, achieve high-quality operations and further promote the development of Infiniti's career in China. After the integration and synergy, Dongfeng Motor Co., Ltd., which owns the three major brands of Nissan, Venucia and Infiniti, will focus on the high-quality development of the passenger car business, optimize the organizational and cost structure, improve decision-making and operational efficiency, strengthen corporate governance, and provide Chinese consumers with diversified products and technologies.

In the eyes of some industry insiders, Infiniti's return to Dongfeng Nissan Business Unit is considered to be a way to reduce spending. "Costs have been reduced but independence has also weakened, which is not a big benefit for luxury brands, but it is really difficult to turn over on its own."

Whether Infiniti still has a chance

Infiniti is a high-end brand established by Nissan in 1989, and as early as 2006, Infiniti entered the Chinese market as an import. Dongfeng Infiniti is a joint venture brand jointly funded by Infiniti and Dongfeng Motor in 2014.

In 2014, Infiniti announced domestic production, and sponsored the celebrity parent-child reality show "Where Did Daddy Go" that year, and then became famous. In 2015, Infiniti's sales in China exceeded the 40,000-vehicle mark for the first time, which was second only to the US market at the time, accounting for 20% of global sales.

After the highlight moment, Dongfeng Infiniti's sales began to decline. According to public data, from 2016 to 2020, Dongfeng Infiniti sold 17415 vehicles, 20164 vehicles, 19114 vehicles, 10820 vehicles and 8951 vehicles, respectively. From January to November 2021, Dongfeng Infiniti's total sales volume was only 7691 vehicles, falling to the lowest level since domestic production in 2014.

Infiniti's official website shows that it has a total of Q50L, Q60, Q70L, QX50, QX60 (imported), and a new generation of QX60 that has just announced the opening of pre-sale. However, the current sales of domestically produced Q50L and QX50, which are the main models, are not very satisfactory. In the first three quarters of 2021, the cumulative sales of the Infiniti Q50L in China were 1677 vehicles, of which the cumulative sales of the Infiniti QX50 were 3449 vehicles. The new generation of QX60 has a high price of about 600,000, in this price range, facing the BBA led by the first-line luxury suppression and the same second-tier luxury Cadillac, Lexus and other strong competitive pressure, QX60's chances of winning are not large.

The general market reaction to Infiniti is that products are slow to change and that the products launched are not favored by consumers. Not only that, product quality problems have also become a major obstacle to Infiniti's development, frequent recalls due to quality problems, and more importantly, CCTV 3.15 due to transmission failure problems. Coupled with the frequent changes in dongfeng Infiniti's personnel in recent years, three general managers have been changed in 4 years, which has also laid the groundwork for this change.

Seven years ago, the domestic Q50L led Infiniti into the ranks of second-tier luxury brands, and seven years later Infiniti has completely gone to the marginal. This time, Dongfeng Motor Co., Ltd. chose to merge Dongfeng Infiniti into Dongfeng Nissan at the beginning of 2022, obviously wanting Infiniti to have a new start.

Dongfeng Motor Co., Ltd. said that after the integration into the Dongfeng Nissan network, Infiniti can further use Dongfeng Nissan's experience in research and development, management and manufacturing to help Infiniti carry out industrial upgrading in many aspects such as electrification, mobile Internet and automatic driving, and further expand Infiniti's possibilities in the field of luxury models.

It is reported that in 2022, Infiniti will introduce a number of new models that can reflect the characteristics of the Infiniti brand into the Chinese market, including the new QX60 SUV, so as to meet the needs of Chinese consumers for luxury cars to a greater extent.

2022 may be the year that determines Infiniti's stay, and whether Dongfeng Infiniti will follow in dongfeng Renault's footsteps and withdraw from the Chinese market in the increasingly fierce competition can only depend on its next performance.

Responsible Editor: Li Yan'an Editor-in-Chief: Yu Jianping