Nisssan Will Not Raise Incentives in US

TOKYO, Dec 5, 2002; Reuters reported that Nissan Motor Co's chief financial officer said on Thursday the Japanese automaker would not increase its sales incentives in the United States next year despite a widely expected fall in car demand in the U.S. market.

"We are selling cars, we're not selling deals," Thierry Moulonguet told Reuters.

Many analysts believe U.S. carmakers will be forced to increase already high consumer incentives as sales soften.

"We don't intend to follow in this path," Moulonguet said on the sidelines of a conference sponsored by investment bank Morgan Stanley.

Nissan has not given a forecast for the size of next year's U.S. car market but some analysts believe sales could slide to about 16 million vehicles from about 16.7 million this year.

Nissan is set to launch a string of new vehicles in North America next year, including the Maxima sedan, the Quest minivan and a full-size pickup truck.

Japanese automakers in general have managed to keep sales incentives, such as discounts and no-interest loans, relatively low compared with their U.S. rivals due to a stronger product line-up, analysts have said.

Nissan has been promoting a new look in North America, starting with the hot-selling Altima mid-size car, which earlier this year was named North American Car of the Year by a group of 50 top automotive journalists -- a first for a Japanese carmaker.

Nissan, whose shares have become a darling of the flagging Tokyo stock market, is expecting another record profit this year thanks to its strength in North America.

Moulonguet noted that Nissan's incentives in the United States have been falling steadily to stand at $1,277 per unit at the end of October -- a historic low for the automaker -- compared with an average $1,621 last year.

In the industry overall, incentives averaged about $2,000 per vehicle in the United States in October, with the "Big Three" -- General Motors, Ford and DaimlerChrysler hit especially hard by a fierce price war.