The first Nissan Altima rolls off the Smyrna, Tennessee assembly line.
With today’s official launch of production of the all-new 2013 Altima, Nissan is loading up for big game, hoping to take down the long-dominant player in the critical American midsize sedan segment, the Toyota Camry.
Long an also-ran, the outgoing Altima has been rapidly gaining ground on both Camry and another midsize segment leader, the Honda Accord. Nissan is betting that with the debut of the new Altima, which officially goes on sale late next month, it will have the momentum to topple the king-of-the-hill Camry.
“Nobody wants to be the silver medalist,” said Bill Krueger, Vice Chairman of Nissan Americas, following the ceremonial roll-out of the 2013 Altima. “We didn’t design and then build this new car and get the workforce ready just to be number two. But ultimately, the customer will tell us” which model they prefer.
Nissan will clearly have a leg up by being the newest kid on the block when dealers begin deliveries on June 26th. But Toyota is not about to cede that advantage without a fight. The Asian giant has been intent on recovering sales and market share momentum after sliding precipitously in the wake of last year’s Japanese earthquake and tsunami, which forced it to sharply cut back production for most of 2011.
At its peak, Camry would routinely generate sales volumes in excess of 400,000 units annually. That plunged to just 308,510 last year. But with Toyota’s factory network back up to normally speed sales surged 32.6% during the first four months of 2012, to 142,225.
It certainly helps having inventory on dealer lots but Toyota has also been extremely aggressive in drawing buyers back to those showrooms, according to analyst Jess Toprak, of TrueCar.com, with some of the most lavish incentives in the company’s history. Meanwhile, Toyota has also been shifting more of its products than ever before into daily rental and other fleets. In March, those outlets accounted for nearly two-thirds of Camry demand, though Toyota insists that was a seasonal anomaly and that it will be pairing back in the months to come.
Or will it? Toyota officials have signaled repeatedly a desire – if not an outright need – to maintain leadership in the high-profile midsize passenger car market, one of the largest segments in the U.S. auto industry.
But that prize is equally attractive to Carlos Ghosn, Nissan’s outspoken CEO, who expressed his goal of being number one during the Altima’s unveiling at the New York Auto Show in April.
To get there, Nissan has completely redesigned the sedan and has gotten kudos for a sleek exterior design that stands in sharp contrast to the relatively dowdy Camry.
(As TheDetroitBureau.com previously reported, the original 2012 Camry design generated such negative feedback during a sneak preview for dealers that Toyota made significant revisions to the exterior and some more modest tweaks to its interior.)
Nissan is billing the Altima as “a class above,” offering a number of features that it believes buyers wouldn’t expect in the midsize segment from a car that starts at less than $22,000. That includes a variety of advanced safety technologies, including Blind Spot Monitoring and a unique system that not only advises motorists when a tire is under-inflated but uses the vehicle’s horn and flashers to signal when it is properly re-inflated.
Meanwhile, with a 38 mpg Highway rating, Nissan is billing the new sedan as the midsize segment’s most fuel-efficient.
For his part, Krueger says Nissan believes such features will trump Toyota’s cash. And if its competitor ramps up its givebacks? Well, there’s a limit to how bad Nissan wants to win the sales race.
“I’m not willing to cut profit margins to beat the number our competitor is doing,” stressed Vice Chairman Krueger.
But Nissan is clearly preparing for victory. The maker is adding a third shift at its sprawling plant in Smyrna, Tennessee and will boost capacity at a second factory producing Altima in Canton, Mississippi. Officials won’t say precisely how much capacity they will have when all comes together, but a spokesman suggests “there could be a ‘4’ in front of it.” Nissan sold 286,000 Altimas in the U.S. last year.
Of course, Toyota isn’t the only competitor Nissan is gunning for. It will be happy to take business away from Honda as well as the fast-rising Hyundai, with its increasingly popular Sonata – along with the Detroit Big Three.
But competition is rapidly ramping up in the midsize segment. Honda will launch an all-new version of the Accord later this year. Chevrolet recently launched production of a special “Eco” version of its Malibu and will bring out a mainstream version before year-end. Meanwhile, Ford will weigh in for 2013 with a much-acclaimed remake of the midsize Fusion, which it previewed in January at the Detroit Auto Show.
The midsize segment is likely to see guns blazing from all directions and industry analysts say the long-established order could very well look much different by this time next year.