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Incentive U-Turn: Nissan may reconsider incentives over repair cost issues

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Toronto, Ontario — September 23, 2019 — Nissan Canada has just announced plans to possibly end their controversial stair-step program, which has encouraged would-be buyers to purchase vehicles with repair costs that may extend beyond their means. 

Nssan’s stair-step incentive program, implemented around 2011, has been offering deep discounts to increase sales and profitability for the North American company. However, dealerships are finding that these deep discounts are actually severely damaging profitability, and creating a need for automotive repairs further down the line.

According to Automotive News, Jim Richter, a consultant located in Calera, Alabama, believes that Nissan’s incentive program has encouraged many of its dealerships to sell more vehicles to “subprime borrowers” with low credit scores.

Richter told Automotive News that often “customers can’t afford to pay for even the most basic post-sale repairs or maintenance that dealerships increasingly rely on for profits.”

Many customers are apprehensive about purchasing additional services, creating a less safe driving experience for motorists.

“If customers can’t afford the additional services requests, no is no. It’s hard to sell service in the drive when people can’t even afford to change the oil in their car.”

Steve Millette, CEO of Nissan Canada announced that they want the companies to focus to be attracting and retaining “the best dealers that are out there in the Canadian industry.”

“If we need to tweak any programs that we have, then we will,” Millette said.

For more information on Nissan Canada’s incentive program, visit nissan.ca 

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