New QX50 factors big for Infiniti dealers
"Profitability" was the big word at Infiniti's NADA Show make meeting, with factory executives outlining several steps to help dealers shore up their operating margins.
The key will be this month's launch of the redesigned QX50 crossover, which the brand believes has big volume sales potential, said Mario Murgado, owner of Infiniti Stuart in South Florida and chairman of the Infiniti National Dealer Advisory Board. "It will provide the momentum for retailers to improve their situation."
- QX50 will be positioned for gross margin.
- QX50 marketing support will run all year.
- 4Inventories will be reduced to minimize sales pressure.
Randy Parker, the outgoing vice president of Infiniti Americas, told dealers that Infiniti is excluding the redesigned model from the company's sales incentive program, urging them to sell it without pressure to discount it.
"This new model is so important to us," Parker told Automotive News after the meeting. "We really want our dealers to take their time selling it, to focus on the vehicle itself, to sell customers on its styling and its technology — not to be pressured to sell it, but to sell it on its merits."
Parker told the dealer meeting that Infiniti advertising will promote the QX50 all year, except for the two months of its annual summer sales event and the year-end sale period in November and December.
He said Infiniti also intends to hold back factory production to make sure inventories stay tight, even though he said the QX50 likely will sell about 35,000 a year, twice its 2017 volume.
The company also is trimming factory output across the board to target a 61-day supply of inventory, down from 65 at the beginning of March, Parker told the meeting. Infiniti had an 82-day supply on Feb. 1.
Murgado and other dealers who attended the make meeting said they believe Infiniti is taking steps to bolster dealer profitability.
Murgado said Infiniti outlined various ways it has improved its brand image, including rising to the No. 1 spot on J.D. Power's 2018 U.S. Customer Service Index Study.
But he said the QX50 will be a critical to the brand in 2018, in terms of increased volume, profitability, showroom traffic and profits.
"It's going to help us on several fronts," he said. "It's a huge growth segment in the industry right now. And we're also seeing tremendous interest in it, both in pre-reservations to buy it, as well as in conquest."
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