Nissan will launch one of its most critical new products next month -- the redesigned 2019 Altima sedan -- and is hoping it will alter the current market reality.
That reality: American consumers are abandoning the sedan segment.
Nissan's response: Give them something in the Altima to make them reconsider.
Nissan has stuffed the next-generation midsize, or "D-segment," Altima with all-wheel drive, a revolutionary new "variable compression" engine and advanced safety technologies such as ProPilot Assist and Safety Shield 360 with rear automatic braking.
"People are looking for tech," Nissan North America Chairman Denis Le Vot said during an Automotive News interview Tuesday. "There used to be less tech in a D sedan. Now we're getting back with the most concentrated technology we've ever had."
It is a power play for the Altima, which until recently has been Nissan's perennial volume leader -- now displaced from the top spot by the Rogue crossover.
Nissan will build the Altima on a global sedan platform that also will be manufactured in China, meaning that it has the expanded sales potential to justify a business case for including expensive new technology such as awd.
U.S. sales of the Altima are off 16 percent this year, and overall midsize sedan demand has dropped 16 percent.
The sedan segment's decline has been a problem for Nissan, Le Vot said. Despite its successes in crossovers over the years, Nissan is still perceived as a "car brand" and is still heavily reliant on sedans for sales.
Le Vot acknowledged that sedans now account for about 30 percent of U.S. sales, down from 52 percent six years ago.
But he predicted sedan sales will return.
"We think 30 percent is the bottom," he said, adding that market factors will bring consumers back to the segment.
"Time will tell," he said. "Market intelligence is telling us that Generation Z's favorite body style is sedans. The big wheel is turning."
His reasoning: Higher interest rates will push many price-sensitive buyers back out of more expensive crossovers and SUVs. The addition of awd will reassure some buyers who want the safety of an SUV. And rising fuel costs will favor more fuel-efficient sedans, he said.
He said Nissan stands to increase conquest sales in sedans as other brands, including Ford, back away from the shrinking pool.
He also hinted that Nissan will be fanning the flame by enhancing all of its sedans in the coming year or two. The Versa, Versa Note, Sentra and Maxima are all slated to follow the Altima with redesigns.
But Le Vot stopped short of revealing any specific product plans.
"This is just the start," he said of the Altima makeover. "By 2020, we're going to be renewing 70 percent of our volume of sales. That is the core sedans, the core crossover and one of the trucks. We're really in a new phase of renewing."
You can reach Lindsay Chappell at lchappell@crain.com