Sunday, July 16, 2017

The Problems With Infiniti and Acura

Alexander Carabitses

(Image credited to Infiniti)

While the three German luxury brands continue their fight over who can sell more exclusive cars and the American luxury brands seek a path towards redemption, a lot of people seem to have forgotten the progress of the Japanese luxury brands, or in some cases, lack thereof.  For those who have forgotten, these brands include Acura, Infiniti, and Lexus, with Lexus being the clear leader amongst the three.  However, the other two brands fight somewhere mid-pack, and for years, Acura has bested Infiniti.  Now, it seems that the tables have turned, as Infiniti is poised to sell 168,000 units by the end of the year, while Acura only sells 151,000. Infiniti's strong sales can be credited to the QX30 and Q60, although sales of just about every vehicle in the brand are up this year.  It is just the latest bit of news in the never ending fight between these two brands to establish who is less mediocre than the other.

From the very beginning, Acura had both a product problem and a perception problem, due to its lack of heritage; today things haven't changed.  I don't care what Honda aspires for Acura to become because the bottom line is that it was perceived as a near-luxury brand from the get-go and it will continue to be perceived as such for all eternity, whether those in power at Honda want to hear it or not. Its product strategy seems to align more with Buick's strategy; keep in mind that Buick is a brand that purposely competes in this segment and outsells Acura as well.  In fact, Buick sold 229,631 vehicles in the US last year, far more than what Acura is projected to sell in 2017. What's unfortunate is that no matter how hard Acura tries to get out of this near-luxury space, it never can because there is no draw to Acura. After all, those who want Japanese reliability and build quality in a luxury car have two other brands, whose products are not a total joke, to choose from. Acura's latest product, the refreshed TLX, looks to be an uninspiring, half-hearted effort when compared to its main competitors (i.e. the new Buick Regal, Nissan Maxima, and Volkswagen Arteon).
(2018 Acura TLX)

The problems don't stop there for Acura though, as styling differentiation from Honda is still something that the brand is working hard to overcome.  I will admit that while I am personally not a fan of Acura's new design language, it is certainly a step in the right direction, at least as far as differentiation is concerned.  Of course, Honda is now using Acura's signature front beak on its new models, such as the 2018 Accord, for absolutely no reason, but I digress.  Another problem is that the interiors of Honda's latest generation of vehicles look a hell of a lot better, and in some cases more premium than Acura's interiors. Finally, Acura desperately needs the subcompact CDX crossover to make it stateside, as this could certainly boost the brand's sales by providing direct competition for the Buick Encore and Infiniti QX30. None the less, establishing a reason for why a customer should choose an Acura over any other luxury brand, or more specifically, any other Japanese luxury brand, proposes a preposterous challenge that may not even be possible to overcome, regardless of whether the NSX is in the lineup or not.
(Image credited to Acura)

We now move on to Infiniti, which has problems of its own.  First and foremost, the brand's product cadence has been practically non-existent for three years, as we were shown concept after concept and refresh after refresh, between the launch of the Q50 in 2013, and the launches of the Q60 and QX30 in 2016.  While concepts generate excitement and refreshes bolster sales a little bit, fresh new product is what drives a brand's momentum in every sector of the market.  In other words, Infiniti has been suffering from lost time without new products, and although I have no confirmation of this, I'm going to take an educated guess and say that Infiniti's older models are suddenly seeing an uptick in sales because of heavy incentives. Fortunately, following another year of no significant product news, 2018 will see the launches of the long overdue QX50 redesign and possibly even the next QX80. Honestly, I would be surprised if we did not see a new QX70 and Q70 launch in 2019.  These key launches will hopefully eliminate the need for incentives, as the brand no longer has to justify selling dated vehicles. I should also add that Infiniti's latest crop of cars look exactly as they should: premium and elegant, mixed with a hint of excitement.

This lack of a product cadence makes it more clear why a luxury brand which competes in all of the adequate, non-niche segments of the luxury marketplace (except for the flagship sedan segment) is struggling to sell vehicles since it has a lineup that can be cross shopped with the German competition. More specifically, it may explain why Infiniti was outsold by Acura for such a long time. It is also true that the brand does need a flagship sedan that will set everybody's hearts ablaze for the Infiniti brand and make a statement about what the brand truly is: a great alternative to Lexus. The difficulty is getting customers to believe it, and when a brand lacks a proper heritage that is expected by consumers who shop in this market, getting them to believe it will be quite difficult.
(Image credited to Infiniti)

The potential (and I can't stress that word enough) bright spot that I see for Infiniti in the long term is that it's the same boat as many other luxury brands, as it waits for the sad truth regarding the redundancy of German luxury brands to set in with consumers.  I have a strange suspicion that the German luxury brands' exclusivity will eventually wear off in their pursuit to sell a vehicle to every person on the planet, and those who want to stand out from the crowd will have to resort to brands like Lexus, Jaguar, Infiniti, Alfa Romeo, and Cadillac. Naturally, a scenario like this would take years to unfold, but given the current trend that I've been seeing from the German juggernauts, I honestly feel that it is more likely for Infiniti to finally achieve full luxury brand status in the future, than it is for Acura to justify why it should be on the shopping-lists of consumers that are in search of the world's finest automobiles.

Thank you for reading and have a good week.

No comments:

Post a Comment