Nissan's small cars hit big

Posted by: David Welch on January 14, 2008

How important are small cars? Just look at Nissan. The company that lost momentum during a rough 2006—when sales dropped 5%—regained it last year with a 6.6% jump. Nissan gained more market share in the U.S. than anyone but Toyota. Almost all of it came from sales of it subcompact Versa, whose sales of almost 80,000 accounted for four points of market share. It’s no wonder that Nissan’s market share jumped from 6.2% to 6.6%. The car even outsold Honda’s fit subcompact.

For further proof that small is the next big thing, sales of Nissan’s Altima family sedan rose almost 19% last year. Its new Rogue crossover suv is gaining ground, too. There’s a lesson here for Detroit. Even when Nissan was gaining market share in the first half of the decade by building new gas-chugging suvs, pickup trucks and luxury cars, the company’s didn’t completely neglect its passenger cars as the domestics did during the suv boom of the late ‘90s through about 2001. When gas prices soared, Nissan was readying some small cars for the market.

That also helps explain why Nissan was the only major carmaker to openly support the newly-passed Energy Bill, which will force all auto makers to meet a fleet average fuel economy of 35 miles per gallon by 2020. Going forward, Nissan executives say they are rushing fuel efficient technologies to their cars to make sure they aren’t flat footed as high gasoline prices and the new fuel mileage regs force America to downsize cars and get religion when it comes to efficiency. Up next: In 2010, Nissan has a new hybrid coming a diesel-powered version of its Maxima sedan coming. “If you don’t try to make this a business opportunity, it will hurt you,” says Dominique Thormann, Nissan North America’s top-ranking executive.

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Want the straight scoop on the auto industry? Our man in Detroit David Welch, brings keen observations and provocative perspective on the auto business.

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