Can Nissan’s Altima Hybrid part Americans from their trucks?
JACKSON, Miss. — Nissan plants in Mississippi and Tennessee are in the running to build the automaker’s new Altima Hybrid, a mid-size sedan with a fuel-efficient, four-cylinder engine with components built by its major rival — Toyota Motor Corp.
Nissan unveiled its prototype for the 2007 model on Wednesday.
Market adversaries Nissan and Toyota agreed in 2002 that Nissan would manufacture 100,000 hybrids over a five-year period. Toyota agreed to supply the transaxle, inverter, battery and control unit. The engine decreases pollution and saves fuel by alternating between a gas engine and electric motor.
After consumer testing, the Hybrid will roll off assembly lines in 2006. Nissan has not decided whether its plant near Canton or in Smyrna (AP) will make the hybrid, Kyle Bazemore, Nissan communications senior manager, said Thursday. The Smyrna plant already produces traditional Altimas, and Canton workers will manufacture Altimas for 2005 starting this summer.
Bazemore promised that Nissan’s hybrid is not just for tree-huggers. “Most hybrids focus on smaller engines with environmental benefits like emitting cleaner exhaust fumes but Nissan’s hybrid will also have the same driver performance and speed as any Altima,” Bazemore said.
With analysts predicting that Americans will face fuel pump prices above $3 all summer, automakers are scrambling to offer consumers the hybrid option. Toyota already manufactures its own mid-size hybrid car, the 2004 Prius. Toyota claims 55 miles per gallon with combined city and highway driving. Consumer Reports found that the Prius gets 44 miles per gallon.
Ford Motor Co. signed its own agreement with Toyota to supply components for Ford’s hybrid version of the Ford Escape sports utility vehicle. Yet Ford is hedging its bets. Ford is also developing a new V-8 engine that it claims will outgun the monster HEMI truck engine that made Dodge Rams a hit.
The Ford strategy reflects a key question. Can outrageous gas prices and hybrids incite Americans into dumping their beloved jumbo trucks?
The Nissan hybrid prototype debuted Wednesday at a San Francisco trade show with so little fanfare, many Nissan dealers were unaware that the prototype now exists.
“I’d heard rumors but haven’t gotten a brochure or press release,” said David Kelly, general manager of Pat Peck Nissan in Gulfport.
Kelly said that “subcompact sales at our dealership are very hot.” But last month, his dealership tallied 17 sales of Titans, pickup trucks whose 305 horsepower engines get 13 city miles per gallon.
And Kelly was surprised by the results of the dealership’s recent “Free Gas for a Year” marketing campaign. “We estimated how much it would cost a customer to fill his or her tank for a year if they bought a vehicle,” Kelly said. “Then we offered to cut that sticker price by that amount. We had very few takers. Most customers preferred to negotiate a price even if it meant paying more than the free gas discount.”
At Jackson’s Patty Peck Honda, finance manager Kathleen McNeil sees hints of a new trend.
“We have had a few customers trade in trucks for Honda Accords,” McNeil said. “One couple who are friends of mine owned two trucks and the husband sacrificed his Avalanche. Some Mississippians love trucks because they need them on fields and dirt roads. But he decided he really just loved his truck more because it looked cool than because he needed it.”
CNW Marketing surveys consumer attitudes and buying patterns in the auto industry. “Normally, emotions are the prevailing factor for Americans buying a car, not fuel prices,” said CNW president Art Spinella. “However, there is one link between truck buying and fuel prices that I call the rule of three. If gas prices stay above $3 for more than three months, consumers pull back from buying gas guzzlers and nationally you do see a drop in truck sales.”