Nissan Unit Slashes Incentive Costs 42%

Gardena-based Nissan North America Inc. said its Nissan division’s newfound sales success with such models as the Xterra sport-utility vehicle and the redesigned Maxima sedan has enabled it to slash incentive costs by 42%. Although the industry average is now $1,750 per vehicle, the Nissan division said its incentive costs for the first half averaged just $1,400, down from $2,400 per vehicle last year. The savings are a critical part of a corporate drive to return to profitability. “Most car makers have to work hard to shave $10 per vehicle from production costs, so to save $1,000 on marketing is very positive,” said J. Ferron, head of the automotive practice at PricewaterhouseCoopers.