Can Nissan breach Fortress Detroit?

How the brand aims to boost share in the domestics’ backyard

How the brand aims to boost share in the domestics’ backyard

Bryan Dumais, vice president over Nissan’s 10-state Midwest sales region: “Detroit has been the impenetrable fortress of the domestics. But we’re going after it. We see it as an opportunity. Our goals are reasonable. We want to be the top import, and that’s really only a little over 3 percent.”Photo credit: AUTOMOTIVE NEWS ILLUSTRATION

DETROIT — At the risk of stating the obvious, Detroiters have never had much use for import vehicles.

Despite seasoned local retailers selling imports for decades, the best any non-Detroit 3 brand can muster here is Honda‘s tiny 2.6 percent market share.

And how could it be otherwise? Manufacturer and brand loyalties go back generations, sweetened by Detroit 3 employee, friends and family sticker-price discounts widely available to the local population.

But now Nissan wants to get serious in the hometown of General Motors, Ford and Chry-sler. It aims to overtake Honda as Detroit’s perennial import leader, building a 3 percent share instead of its current 0.8 percent share, according to Nissan’s reckoning, as well as registration data collected by IHS Automotive.

Even that will be a battle, acknowledges Bryan Dumais, who is on the front lines of the effort as vice president of Nissan’s 10-state Midwest sales region.

“Detroit has been the impenetrable fortress of the domestics,” Dumais says. “But we’re going after it. We see it as an opportunity.

“Our goals are reasonable. We want to be the top import, and that’s really only a little over 3 percent.”

It is far more modest than Nissan North America’s larger crusade: a 10 percent U.S. market share, up from 8.5 percent at the end of 2015.

But it is also Detroit.

And one Nissan rival at Honda says it will be no cakewalk.

“This is a tough market to break into,” warns Ken Litner, general manager of Victory Honda in Plymouth, 25 miles from downtown Detroit. “And I know — we used to own a Nissan store here.”

That was a few years ago, Litner says. But the Detroit 3 are still deeply entrenched.

“I’ve got three Ford stores in my dealership’s market area,” he says. “They sell about 9,000 new Fords a year together between them.”

The Detroit 3 directly employ about 105,000 people in the Detroit area. All of them, their spouses and children, as well as thousands more qualifying supplier households, enjoy discounts on domestic-brand vehicle purchases.

Dumais closes his eyes and nods at the mention of the colossal competitive tool of discounts for employees, as well as their friends and families.

But he is undeterred.

“We have some tools at our disposal now,” he says. Among them:

n Nissan is offering conquest incentives. Show a Nissan dealer proof of ownership of a domestic-brand vehicle, and the dealer will knock another $500 off a Nissan purchase.

n Nissan is upping the volume on its version of friends-and-family discounts — called the Vehicle Purchase Program. “We have 1,200 people of our own employed right here in the Detroit area,” Dumais points out, referring to Nissan’s growing technical center in suburban Farmington Hills. “We’re trying to do a better job of letting their families know the benefits of our plan.”

Skipping TV ads

Nissan is also avoiding slugging it out on Detroit TV, where domestic-brand advertising is king.

“We’re not going to shout on TV to a mass market of people who are already intenders for domestic brands,” he says. “That would be a very expensive and unsustainable strategy. We’re going to focus on reaching them through digital marketing. And we’re going to focus on the people who are already leaning toward a nondomestic brand.”

Nissan is also focusing on a strengthening dealer network in the market. Three new dealerships are opening, replacing three that have been vacant as frustrated dealers left. The addition of stores in Dearborn, a western suburb that is the home of Ford Motor Co.; in Macomb County, a northeastern suburban area; and in Grand Blanc, a city about 65 miles north of Detroit, restores Nissan to six dealerships in the market.

In July, a group of New Jersey dealer partners, Mike Saporito, Antonio Pierce and Jessie Armstead, opened All Pro Nissan in a converted Pep Boys auto parts store in Dearborn. Saporito is the owner of Hamilton Honda in Hamilton Township, N.J. Pierce and Armstead are former NFL linebackers who are now focusing on auto retailing.

All Pro Nissan opened in July in Ford Motor Co.’s home of Dearborn, Mich. Dealer Mike Saporito says, “We’re confident that it’s possible to sell Nissans in a market where the common thinking says you can’t.”

“We’re confident that it’s possible to sell Nissans in a market where the common thinking says you can’t,” says Saporito, who is building a second store in Macomb County. “The perception of foreign and domestic brands is not what it used to be. We think there is a big opportunity. And frankly, we’re already succeeding.”

Indeed, despite expectations that All Pro Nissan would sell about 40 new vehicles a month to start, the store has been running at more than double that volume. In January, the new dealership was on track to sell 125.

John Chatzopoulos moved from Saporito’s operations in New Jersey to be general manager of the Dearborn store.

“We’re used to doing a big business in the Northeast,” Chatzopoulos says. “We looked at the average volume for Nissan here in this market: 44 sales a month. We didn’t come here to sell 40 or 50 cars a month. We’ll sell 125 this month. We believe we can go beyond that.”

Nissan’s multipart campaign first requires getting all six of its local dealerships up and running.

All Pro Nissan was designed to be customer friendly, Chatzopoulos says. There are no overeager visitor greetings in the parking lot. Customers entering the store are first given a tour of the operation. They meet the store’s manager and service department personnel before business is discussed. They see a heritage hallway where the co-owners’ NFL memorabilia is on display. The finance department is surrounded by glass walls to create an open environment.

None of the sales employees All Pro Nissan hired had sold vehicles before.

“We didn’t want people having the attitude that they already know how to do things and they don’t want to bother with doing it our way,” Chatzopoulos says. “At the same time, a lot of the experienced salespeople here in the Detroit area come from the domestics, where it’s always about friends and family. That’s not really selling — it’s order-taking.”

Nissan plans to focus first in Detroit on its higher-volume core vehicles — the Altima, Sentra, Rogue and Versa. Dumais believes that by concentrating marketing and incentives on popular nameplates, the company can produce stronger results.

The dealers in the region agreed to pony up more money for local marketing — putting 1.5 percent of sales toward advertising instead of the normal 1 percent.

Truck push

Another key for the campaign will be trucks.

In January, Nissan began rolling out its redesigned Titan full-size pickup, a segment in which the brand has languished for most of the past decade. The new V-8 diesel-powered Titan XD is larger and brawnier than anything Nissan has marketed in the United States. A range of Titan variations will appear this year.

“Full-size trucks represent 13 percent of the Detroit market,” Dumais says. “And we haven’t been part of it. We’ve been trying to compete here with one hand tied behind our back. That’s going to change now.”

Nissan North America Chairman Jose Munoz is determined to wake up Nissan’s presence in the pickup and commercial van markets across the United States. That is a key piece of his mission to take Nissan and Infiniti together to a 10 percent U.S. market share.

Dumais’ efforts in Detroit — and across his Midwest region in general — will also be part of that.

“In order to get to 10 percent, we can’t overlook a city like Detroit,” Dumais says. “This is one of the biggest markets in the country. The time is right for us to move ahead here.”

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