Nissan Plans a New Car, Smaller Than Sentra

DETROIT September 13, 2004; John Porretto writing for the AP reported that after bulking up its lineup with a new crossover vehicle and full-size pickup, Nissan Motor Co. plans to tweak the other end of its portfolio by redesigning the compact Sentra sedan and introducing an even smaller car in 2007.

Nissan said Monday the next-generation Sentra, which competes against models such as the Honda Civic and Toyota Corolla, would debut in 2006.

The Japanese automaker, whose U.S. sales were up 23 percent through August, has not finalized plans for the new small car or decided where it will be built, said Jed Connelly, senior vice president for sales and marketing at Nissan's North American arm.

Nissan said the car could mirror its Cube, March and Micra compact models sold only in Japan and Europe.

"If we had the Sentra alone, it would have put a lot of pressure on (that model) to straddle a large buyer group," Connelly said. "Now we can say let's just have a Sentra that can compete with Civic and Corolla. It allows us to be a little more specific with the Sentra."

Industry observers say inexpensive small cars remain an important part of the business because they often are a consumer's first experience with an automaker. General Motors Corp., for example, introduced the Aveo, a Korean-made entry-level vehicle, late last year.

The small, typically economical cars, while not always profitable, also help automakers meet federal standards for corporate average fuel economy, or CAFE.

Mike Wall, an industry forecaster with CSM Worldwide, said he also expects Honda to launch a car comparable in size to Nissan's new offering for the North American market.

Several new vehicles, such as the Titan pickup and Murano crossover vehicle, have helped Nissan increase its share of the U.S. market to 5.7 percent for the first eight months of 2004 from 4.6 percent a year ago. Its 2003 U.S. sales rose 7.4 percent.

In a recent research note, Merrill Lynch analyst John Casesa said one of the reasons for the success of Japanese automakers in recent years -- at the expense of Detroit's Big Three -- has been a greater proclivity to turn over their product lines.

Casesa said he expects Nissan, Honda Motor Co. and Toyota Motor Corp. to remain well above the industry average for new product activity through 2008.

Nissan Motor Co.: http://www.nissanmotors.com