Nissan has big plans for new single-cab versions of the Titan and Titan XD pickup trucks targeted at the commercial market. There’s just one problem: Among the five full-size pickup truck brands in the U.S., the automaker will have to fight its way up from dead last.
These new versions of the trucks, positioned mainly for the construction trade and small businesses, are key to a long-term plan to improve consumer acceptance and trust as Nissan fights for sales, said Michael Bunce, vice president of product planning at Nissan North America.
To make headway in the intensely competitive pickup truck market, the automaker wants to tap into the authority of commercial sales, he said. If more Nissan pickups are parked at construction sites, more consumers will consider other Titan versions for personal use.
“We know for truckers, it’s about credibility,” Bunce said. “It’s about how much can you tow and haul, right? And you may not necessarily need that all the time, but it’s about having that capability and wanting to have that capability upfront and under the metal.”
Nissan needs to make some sort of move. It’s not just in last place in the big pickup truck marker — it’s way back.
Riding the Pickup Wave
The Japanese brand, which makes its trucks in Canton, Miss., has sold barely 17,000 of the Titans and Titan XDs this year. However, through November, sales have posted a 57 percent gain compared with the same period last year.
But during that same time, Ford has sold more than 733,000 F-Series pickups; Chevrolet has sold more than 520,000 Silverados; and Fiat Chrysler Automobiles has sold more than 440,000 Ram trucks. Even fourth-place Toyota is far ahead of Nissan, logging sales of more than 100,000 Tundras so far this year.
Though it may be behind, Nissan is attempting to climb aboard a rising wave of pickup sales.
U.S. businesses and consumers have snapped up more than 2 million full-size pickup trucks in 2016. Sales of all pickups, including midsize models like the Toyota Tacoma and Nissan Frontier, are approaching 2.5 million and have risen 6.2 percent over the same period a year earlier, according to AutoData Corp., an industry research firm. The gain has come at a time when the overall auto market has plateaued.
Tapping the commercial market is a good strategic move, analysts said.
“There is a strong halo effect from the commercial side of the business on the retail side,” said Ed Kim, vice president of industry analysis at the AutoPacific consulting firm.
Commercial sales, Kim said, signal to consumers that the trucks will last and “take whatever beating they’re going to throw at it. They want to know that the bones of the truck are still the same as what the commercial guy uses.”
Confidence Is Key
Nissan also has a secret weapon to provide inroads to potential buyers: a five-year, 100,000-mile warranty on all Titan and Titan XD commercial vehicles. The offer easily eclipses the standard three-year, 36,000-mile warranty in the pickup truck segment and is available for commercial and retail vehicles alike. The plan could pay substantial dividends, enticing once skeptical businesses as well as personal buyers to consider Nissan trucks for the first time, says Stephanie Brinley, an analyst at IHS Markit.
Nissan wants the long warranty to win the trust of business fleet managers, who are often wary of change and show high brand loyalty. Any time spent repairing or maintaining trucks is time that the vehicles aren’t spending on the job.
Nissan is hoping to reach more customers such as David Thompson, who for the past 24 years has owned and operated DET Electrical near Jacksonville, N.C. Thompson switched from a GMC Sierra 2500 Denali HD to a crew cab Nissan Titan XD 4×4 in June.
“The warranty makes all the difference in the world, especially for business,” says Thompson, who in addition to his electrical business uses his Titan XD for general contracting jobs. Thompson estimates he saved about $20,000 on the purchase compared with similarly equipped trucks from other brands. The Titan XD is able to handle the same workload as his previous heavy-duty trucks, he said.
“The pulling power is unbelievable,” says Thompson. “It doesn’t set down like most trucks would and squat in the back.”
The truck’s attractive price point drew him in, but the all-around performance has made him a believer.
Building on Commercial Success
Nissan knows the commercial market.
The brand has seen success with its NV200 Compact Cargo van, even licensing the vehicle to General Motors to be sold as the Chevrolet City Express. It also sells the NV Cargo Van. The addition of a commercial pickup could be attractive to existing customers who will no longer have to shop multiple brands to build their fleets.
“They don’t want to go to Ford for their trucks and Nissan for their vans,” Bunce said.
“The most important element for Nissan in this strategy is simply the potential for increasing consideration,” said Brinley. “Without consideration, sales are impossible.”
Although U.S. consumers snap up smaller pickups from Japanese brands, including the Frontier and Tacoma, the full-size pickup market is dominated by the American nameplates. Toyota has barely 5 percent of the big pickup market. Nissan has not quite 1 percent, according to Autodata.
Still, businesses won’t invest if the trucks don’t impress.
“Nissan can use the warranty to get a skeptical buyer to take a look,” said Brinley. “From that point, the product itself will have to convince them.”
Establishing trust is crucial to Nissan’s long-term strategy, but that takes time. Awareness of Nissan trucks and what they have to offer remains relatively low, Kim said.
While the marketing plan is a start, eventually sales of the Titan and Titan XD will need to improve for Nissan to remain a viable seller of full-size pickups.
“They’re going to have to get some volume out of it in order to make the program financially successful and viable over the long term,” Kim said. “They’ve got to sell a lot more of them than they have.”