(engine accelerating)
- Look, I love Nissan, but right now,
it feels like they're on the path
to going out of business.
How did we go from the S13, to the Versa;
from the R34
to the Murano convertible?
(upbeat music playing)
In this video, we're gonna take a look at what Nissan
did right in their past,
and what they're doing wrong, now,
and then, I'm gonna take a look at some ways
that could turn things around.
So come with me, if you wanna survive!
Problem #1: all we care about are old Nissans.
Nissan had some of the sickest,
most iconic cars ever made.
But over the last 20 years, they've really dropped the ball.
The quality of their cars has gone downhill,
and they've lost their core audience.
And it shows in their numbers;
in the beginning of 2019,
they lost 99%
of their operating profit,
and had to lay off nearly 13,000 employees.
Which makes me wonder:
how does a company, that made so many of the cars
that we all wanted and loved,
fail so hard?
We're gonna get into that,
but first, let's look at why we love their cars so much.
(upbeat music playing)
Nissan, or as they used to be called, Datsun,
has been around for over 100 years.
Bur most of the coolest cars they made were
from the 1970's,
80's,
and 90's.
The z line really put Nissan on the map in the U.S.,
starting off with the 240z, in 1969.
This family of affordable sportscars made it possible
for every Joe Shmoe to drive a fun, stylish car
that could rip.
Then, there was, of course, the Skyline,
which is arguably one of the most influential cars
of the last 50 years.
As American cars got worse in the 70's and 80's,
both the Skyline and the z cars continued to get better,
building a core fan base with cars that really stood out.
By the 1990's Nissan was at the top of their game,
with new models like the twin turbo 300zx,
even the 240sx, they gained a whole new generation
of enthusiasts.
Even their entry-level models had high performance versions,
like the Sentra SER.
They made great cars that drove well, they were reliable,
and felt planted on the road.
Nissan spent a lot of money making their cars great.
The yen was so strong, that they could afford to.
But, before long, Nissan was struggling to make a profit.
Actually, for most of the 90's,
they didn't even make a profit, at all.
When you're not making a profit, it's hard to innovate.
That's Business 101.
(chime sounding)
So, while their competitors were releasing new models
every couple of years,
Nissan almost went a decade without a major update
to their models, which, uhhhh, sounds familiar.
From a car enthusiast standpoint, we look back
at the Nissans from the 90's as some of the most fun
drivers' cars out there.
But, little did we know,
that they were on the verge of bankruptcy.
They were actually losing $1000 for every car they
sold in the U.S.
I never took any business courses, but that's,
that's not good.
By 1999, things were looking even bleaker for Nissan.
They entered into an alliance
with French car manufacturer, Renault,
who offered to take on $5.4 billion of Nissan's debt,
in exchange for 36% stake in the company.
On the other hand, Nissan would import, and sell,
Renaults in Japan.
It was a solution that benefited both companies.
To spearhead the new initiative that would bring Nissan
out of the red, Renault brought in the notorious
Carlos Ghosn as CEO, who is in jail, right now.
More on that, later.
So, what are the seven ways that Nissan is failing?
Well, let's get into it.
(apprehensive music playing)
Cutting too many corners.
The first major change Carlos Ghosn enacted, as CEO,
was to cut production cost.
Nissan was spending 15 to 25% more on parts
than their competitors.
So, they started to install cheaper parts.
Which makes sense, from a business perspective,
but then we get things like timing belt guides
made out of plastic.
Guides and tensioners that kept the timing belt in place,
on six different Nissan models, made from 2004 to 2010,
were made out of plastic that degraded really quickly.
Which meant timing belts on those cars
had to be replaced early on in that car's life.
Nissan actually lost a class action lawsuit over it,
and they were forced to address the problem.
One of the more well-known foibles that afflicted
Nissan cars was their CVT.
Nissan's continuously variable transmissions
were some of the worst-made transmissions in recent history.
They commonly failed around 60,000 miles,
which is, conveniently, right when their warranty ran out.
Luckily for owners, Nissan was sued, yet again,
and was forced to recall the cars that had the CVT.
They also extended the warranty
from 60,000 miles to 100,000.
So, good for them.
(jazzy music playing)
Even with a new round of updates in 2012,
they weren't quite able to improve quality,
or driver satisfaction.
In a consumer report study, done in 2014,
14 of the 22 Nissans and Infinities ranked last
or second-to last in their respected categories.
Some testers said the cars felt cheaper, less refined,
and even less enjoyable than before.
That's,
that's not progress.
If there's one good thing to be said about Carlos Ghosn,
it's that he did get Nissan out of the hole.
Without his contributions,
we might not have the brand around, today.
If he didn't cut cost in jobs and lower the overhead,
they wouldn't have been able to design new cars.
This is when Nissan started developing more entry level
volume cars, like the Versa.
You know, everyone's most hated rental car.
I sat in one, and it somehow felt older
than an, like, old Sentra.
It was weird.
To their credit, though, these volume cars
are the biggest reason Nissan was able
to turn things around.
But, in the process, they kind of
lost the company's soul.
Cars, like the crossover Murano and the
new generations of the Altima and Maxima,
were decent, but the market quickly became saturated.
It seemed like every other car on the road
was a freakin' Altima.
This early 2000's gen was the most powerful yet,
but mechanical issues plagued the cars-
usually, right after the warranty ran out.
Floorboards rusted through, they ate up oil,
and catalytic converters were known to fail.
These cars wouldn't have been volume cars, though,
if people didn't buy them.
To ensure that
that happened, Nissan sold to anyone,
despite if they could afford it, or not.
This was possible because of a little thing called
subprime loans.
(quirky music playing)
(party horn sounding)
if you're not familiar with these kinds of loans,
they're, basically, what led to the recession of 2008.
- What in the world is happening on Wall Street?
- They're aimed at people with bad credit,
and have insanely high interest rates,
like 25%!
One guy in Indiana financed a $21,000 used truck
with a subprime loan.
But, by the time he would have owned it,
it would have cost him over $44,000!
Good thing he couldn't make that $750 monthly payment,
and ended up having to go bankrupt.
There are 1000's of stories like this,
and Nissan's not the only one causing this issue.
(engine accelerating)
(upbeat music playing)
Maybe the biggest reason Nissan is blowing it,
is because they're in
the same situation that they were in the late 90's.
Their most fun, most enthusiast-based models
haven't been updated frequently enough.
The 350z was in production for seven years.
The 370z has gone 10 years with almost no updates!
I mean, the 370 was basically just an upgraded 350,
to start off with.
Even Nissans's flagship model, the GTR,
has been around for 12 years, with only a handful
of performance upgrades.
Most changes they make are based on comfort and style.
You can't do that and expect fans to stick by your side.
We get bored!
We're just cats, man!
I'll play with that toy for like, five minutes,
and then never touch it again.
Then, there's the whole Carlos Ghosn fiasco.
The man who turned the company around
turned out to be siphoning money from said company.
He got busted last year.
We actually made a whole video on it,
if you wanna learn more.
The whole Carlos Ghosn thing kind of soured
the public's perception of Nissan,
and they have yet to bounce back.
In the spring of 2019 Nissan lost 95% of net income,
and 99% of their operating profit.
Their revenue dropped 13%, and the company was forced
to lay off 12,500 employees.
Nissan is basically in the same exact position they were in
before Carlos Ghosn took over.
So.
How should they turn things around, this time?
(resolute music playing)
I think the most pressing issue is that
Nissan needs to make their cars more reliable,
starting with the quality of their parts.
There's a reason that 30-year-old s13's are still
the preferred car for drifting.
They're solid as hell, especially the chassis.
You can strip them down, and they still maintain
structural rigidity.
Can you imagine, people in 30 years,
drifting clapped out Murano Cabriolets?
Not gonna happen.
But let's take a look at what happened with the KDM cars.
Kia and Hyundai had some of the worst reputations
in the late 90's and early 2000's.
But, they turned things around, and nowadays,
they're affordable, reliable,
and some of the best-selling cars in America.
The quality is great, and some of them look
cool as hell.
The Veloster N is a certified ripper,
and Hyundai even has a luxury brand, now, the Genesis.
The Kia Stinger is amazing.
I love that car.
Good work, KDM.
Nissan, you should copy their homework.
I know the type of person who drives a GTR,
but I don't know who drives Nissans.
I don't think Nissan knows who drives Nissans .
They need to find their audience, and then cater to them.
Maybe they should take a page out of Dodge's book.
They debuted the Hellcat, maybe the most ridiculous
production car, ever made.
And instantly, that cemented their identity.
This is a consistent message across all their cars
and marketing, and we like them better, for it.
They paid James to get a Dodge tattoo.
- Ow!
Owowowow!
Ow!
- Third, and, most importantly, in my mind,
take a page out of your own book, and bring back
some fan favorites, Nissan.
How sick would it be if Nissan made a new Sylvia?
It would be great competition for the GT86.
Overall, I think they need to be more competitive
with their cars.
You hop into a new Corolla, it's pretty nice!
You hop into a new Sentra and you're like,
how does this interior feel older than the old Sentra?
It doesn't make sense.
This just might be the car nerd in me,
but I think it's vital that Nissan focus their efforts
on updating the z and the GTR.
Both those cars are sick,
and still relevant in the bigger picture.
But, it's been more than a decade, Nissan.
That's unacceptable.
Think about how sick a new z model would be
to usher in this new decade.
And maybe a new GTR?
The R36, perhaps?
I think most of all, we just wanna see Nissan
make some fun cars, again.
When the GTR came out, it was awesome.
It is still an awesome car.
But Nissan needs to follow it up
with something else, soon,
before our excitement-
and our bank account-
runs out.
Hey, so this is the first new episode of 2020.
Let's resolve to be more kind to each other.
Nissan, I love you.
I wanna see you guys succeed, man.
Be kind!
See ya next time.
New catchphrase 2020, baby!
Being nice is not the same as being kind.
Being nice, people be nice to your face.
Don't be nice!
Be kind!
See ya next time.