Nissan enters minicar market with the Moco

BLOOMBERG reported that Nissan Motor Co. said it plans to sell 4,000 minicars a month at home, as Japan's third-largest automaker enters the segment for the first time to expand its customer base.

The Moco, which Nissan is buying from Suzuki Motor Corp. and then putting its own name on, is equipped with a 660 cc engine and will cost at least $7,666, the company said in a statement.

Nissan, 44-percent owned by Renault SA, initially intended to sell 3,000 of the minicars a month in Japan, but raised the goal after studying the market. President and Chief Executive Officer Carlos Ghosn said Nissan may need a year to develop a broader minicar strategy, including adding new models of its own, or continuing to buy models from Suzuki.

"The minicar segment is a growing one in Japan and this is a big step into the market for Nissan," said Graeme Maxton, a consultant at Autopolis in Singapore. "The minicar segment has a strong potential to grow in markets like Europe and India."

As part of an agreement formed by the two companies last year, Nissan said it would sell Suzuki-made models under its own brand for now. Nissan wants to extend its range to include minivehicles that now account for 30 percent of domestic auto demand, analysts said.

The automaker will have the largest network of minicars in Japan, tapping its 2,700 outlets to sell the Moco, he said.

Suzuki, the biggest minicar maker in Japan, will benefit by increasing the scale of its production in a market that's otherwise stagnant, and help it fend off competition from Toyota Motor Corp. affiliate Daihatsu Motor Co.

Nissan, which fell short of its domestic unit sales target for the year ended March 31, 2002, plans to release six new models in Japan this business year, including the Moco. About one-quarter of Nissan's current customers own minicars, Ghosn said.

The Moco's price compares with Nissan's revamped March compact car, which was unveiled in February, and sells for between 953,000 yen and 1.32 million yen.

Nissan received 40,000 orders for its March compact in the first three weeks after the model was made available for dealers on March 6.

"This is a very good number," Ghosn said at a Tokyo press conference. "I have specifically asked marketing and sales division that nothing artificial is done," he said, adding that the March and Moco are complementary.

Nissan will release the revamped Elgrand minivan, Z sports car, Cube compact, new Cefiro sedan and luxury sedan this business year.

Suzuki is 20-percent owned by General Motors Corp.