March 29, 2012 at 7:53 AM ET
Infiniti plans to lift the covers off Japan’s first battery-electric luxury car during the upcoming New York Auto Show.
Company executives suggest they expect some serious sales numbers from the new model. But the real benefit is likely to come from credibility. Like its parent, Nissan Motor Co., Infiniti has been slow to embrace more conventional hybrid technology. Japanese rival Lexus already offers gas-electric options on most of its line-up. European automakers, such as BMW and Mercedes-Benz, are rushing to market with their own hybrid offerings.
So Infiniti is hoping to use the battery car, which shares the basic underpinnings of the Nissan Leaf, to position itself as a legitimate player in the global luxury market.
Since its 1989 launch -- which coincided with the debut of the far more successful Lexus -- Infiniti has struggled to develop a clear identity and claw its way out of the second tier of luxury brands. In fact, it wasn’t all that many years ago that some analysts were speculating whether the Nissan division would even survive.
But Infiniti is back on the luxury map with a wave of distinctive designs, strong products and well-regarded powertrains. And with the upcoming launch of the yet-unnamed battery car -- as well as the more mainstream JX crossover/utility vehicle -- this could prove to be one of the most significant years in Infiniti’s two-decade history.
If the battery car is intended to put a halo around the brand, the JX is designed to put butts in seats, as industry marketers like to say. The 3-row, 7-seat CUV fills a big gap between the smaller, sportier FX and the mammoth and costly Infiniti QX.
“We were underserving the market … and losing people,” acknowledges Sean McNamara, Infiniti’s senior manager of product planning.
Even with the JX, there are plenty of holes in the Infiniti line-up, cautions Aaron Bragman of IHS Automotive. But the situation is a lot better than it was not all that long ago when Infiniti not only had fewer products but models were decidedly undistinguished.
That began to change with the debut of the compact of the edgy FX crossover and the G-car line, which goes up against the likes of the Mercedes C-Class and BMW 3-Series. Japanese luxury brands have had a history of playing it safe, but corporate design chief Shiro Nakamura had developed enough clout to press the boundaries, winning raves and a surge of new buyers.
“The Infiniti design language is finally coming into its own,” says analyst Bragman, “and we’re finally seeing the differentiation between Infiniti and Nissan products.”
Nakamura continues to push the edge with concept vehicles like the Etherea, a sports car-like compact model, as well as the Emerg-E, the roundly applauded plug-in hybrid concept that made its debut at the Geneva Motor Show earlier this month.
Of course, it’s critical to have the resources to back up those design efforts. And a production version of the sleek, silver Etherea is expected in showrooms by mid-decade. It will benefit from an expanding alliance between Nissan, its long-time partner Renault, and the German Daimler AG, parent of Mercedes. Etherea will use the same underpinnings as the next-generation Mercedes A-Class, which also debuted in Geneva this year.
In turn, Mercedes will get a version of a small Nissan engine for use in the next C-Class. And together, the three partners are working on advanced battery drivelines that could eventually show up in models such as a production version of the Emerg-E.
The cost of developing a small car from the ground up is significant. “I don’t know if Infiniti would have otherwise had the resources” without the alliance, says Bragman, though he warns that it will be critical for Infiniti to differentiate the look and feel of its products and not appear to be a me-too clone of Mercedes.
If it works, the payoff could be significant. Infiniti was already on a roll, coming out of the worst downturn the auto industry had seen in decades, sales rebounding from an 81,000 low point in 2009 to more than 103,000 a year later. For 2011, Infiniti seemed poised to approach, perhaps even beat, its all-time record of 136,000, set in 2005.
Then disaster struck. And, like the rest of the Japanese industry, the March 2011 earthquake and tsunami led to production cuts and serious shortages, and sales slipping to 98,461. But it could have been much worse, contends planning chief McNamara. Nissan and Infiniti rebounded faster than most of its competitors and it has been posting strong gains during the new year.
And not just in the U.S. Until recently, Infiniti focused primarily on America, the world’s largest luxury market. But over the last several years Infiniti has been rapidly rolling out across the globe and is now operating in 46 different countries.
In an unusual move, Nissan announced plans, late last year, to move Infiniti’s headquarters to Hong Kong. “We see an opportunity to reinforce Asian hospitality within the Infiniti brand, distinct from both Nissan and our facing luxury competitors,” explains Nissan Executive Vice President Andy Palmer.
It will likely take a few years to see if it all pays off. But Nissan is betting its luxury brand will continue showing momentum and could eventually climb out of the second tier ghetto.