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Sharp turnaround sees Nissan's Canadian sales soar

Christian Meunier, president of Nissan Canada, presented the 2015 Nissan Micra at the Montreal auto show.

Nissan

Nissan Canada Inc. has topped 100,000 sales for the first time in any 12-month period, a sharp turnaround from 2011 when Carlos Ghosn, chief executive officer of its parent company, singled out the Canadian unit's performance as unacceptable.

Nissan Canada is set to reveal Tuesday that deliveries topped the 100,000 level in the 12 months ended May 31, driven in part by a 28-per-cent increase in sales in the first five months of 2014.

"Canada is an important market to us," Trevor Mann, chief performance officer of parent company Nissan Motor Co. Ltd., said in an interview at the Canadian unit's head office in Mississauga. "Nissan believes that Canada is a good market for us, a good opportunity for us, we've got a long-established history here, we've got a strong dealer body."

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Much of the turnaround has been driven – as such improvements usually are in the auto market – by new vehicles. In Nissan's case, that includes the redesigned Nissan Rogue.

But the arrival of the Nissan Micra subcompact in April illustrates the biggest change at the company. Nissan Canada is now being managed by a team that is aware that the Canadian market is distinct from the U.S. market, so what works there doesn't automatically work here.

"Previously there's been some joke internally about seeing Canada as the 51st state," said Mr. Mann, a native of England, who joined Nissan in that country in 1985.

The Mexican-made Micra is not sold in the U.S. market, where subcompacts are not as popular as they are in Canada, where there is a more frugal approach to driving and higher gas prices.

"That was a big bet, because it's a lot of investment to get the car to meet the regulations of Canada," said Christian Meunier, president of Nissan Canada.

Sales of the Micra were close to 1,000 in May in its first full month of sales in Canada, Mr. Meunier said.

Sales of the Rogue compact crossover have jumped about 88 per cent to 8,745, vaulting it ahead of the Chevrolet Equinox and closer to the Honda CR-V, Toyota RAV4 and the Ford Escape, which leads the segment.

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The success of the Rogue and the Micra have helped boost market share in Canada for Nissan and its luxury Infiniti brand to 6.4 per cent as of the end of April. That compares with 5.3 per cent in 2011, the year when Mr. Ghosn described the company's performance in Canada as "absolutely unacceptable."

That 6.4-per-cent figure, however, still falls short of Mr. Ghosn's target for Nissan as a whole under his Power 88 plan, which calls for 8 per cent market share globally and 8 per cent consolidated operating profit by 2016.

"The goal is to continue to build momentum in a sustainable way," Mr. Meunier said. "There is no point in growing the wrong way."

One area of weakness in Nissan's sales is in the compact car segment, which is the largest segment of the market and is dominated by the Honda Civic, Hyundai Elantra and Toyota Corolla.

Sales of Nissan's entry, the Sentra, fell 4.5 per cent as of the end of April.

The plan is to relaunch the car this summer, Mr. Meunier said, with a new marketing campaign.

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"That's really a tough segment, but it's clear that we have a good product and we're not there to stay where we are," he said.

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About the Author
Auto and Steel Industry Reporter

Greg Keenan has covered the automotive and steel industries for The Globe and Mail since 1995. He also writes about broader manufacturing trends. He is a graduate of the University of Toronto and of the University of Western Ontario School of Journalism. More

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