Special Correspondent Michelle Krebs talked with Tom Orbe, Infiniti general manager, in San Francisco on Friday, Feb. 5, before the National Automobile Dealers Association convention opened. What follows is an edited transcript.
Infiniti has some new products coming. Can you provide details?
We have a new product roughly every six months for the next few years.
Last summer we introduced the G20. We've got a special edition I30 this spring to clear out the I30s before the new one arrives in August. The new one will have more differentiation from the Maxima and more horsepower. It will go from the current 190 to more than 225.
Shortly after that, we have the new QX4, which has a redesigned front and rear end. The horsepower, the only issue we have with the current one, is increased from 180 to more than 225.
The new Q45 arrives in October 2000. Six months later we'll have a new G20. Then we'll add a fifth product to the line. We have a platform, but we're not sure yet if it will be a coupe or convertible.
Nissan hosted a successful road show tour to provide dealers and media with a preview of upcoming products. Does Infiniti plan anything similar for its product blitz?
At the New York auto show, we'll be unveiling the I30. We'll also be inviting all of our dealers and some media to see some future products, including the new QX4, G20 and a clay model of the new Q45.
How is Infiniti doing financially?
In the last fiscal year we made money, after breaking even the year before. In the next fiscal year we'll make significantly more. Because we're contributing more to the company, we're getting more attention.
How are you involving dealers more in your business?
We are doing short satellite broadcasts to all dealership personnel every month. Over the past four weeks, we visited every one of our 150 dealers in small groups or one-on-one. We laid out our vision.
What was a priority for dealers from those meetings?
One of the things that came out of those meetings was the need for more training funds, so we're tripling our training over the next couple of months. We're doing the vision training with every employee of every dealership like we did when we first entered the market. We're also doing one-on-one training with dealers.
What is Infiniti doing with the Internet?
We're getting more involved in the Internet.
We recently started an owners' club area on our Web site. Owners can type in their vehicle identification number to find what extras they can get. They can get deals on travel. They can get discounts on merchandise, like Palm Pilots. We're adding more merchandise in the future.
As this develops, we'll be able to see what they like and customize the offerings to that customer.
Some luxury car dealers are concerned that Infiniti and others will follow Mercedes' lead by cutting the gross profit margin. Is that Infiniti's intent?
We will not reduce the gross margin, which is at 14 percent. In fact, we have increased the grosses on special-edition models like the Q45t.
We are also helping dealers reduce expenses with things like increased floorplanning assistance. We are looking at other ways to help dealers with expenses so they can pass the savings on to customers.
We also added an incentive for sales consultants, which is based on the dealership's performance. We are looking at doing the same for dealership employees on the service side of the business. We will be announcing that in the next few months.