[Car Talk Forest] The Bitter Exit of Hanguk Nissan

Nissan 'New Maxima' (Photo by Nissan Korea)

[Asia Economy Reporter Kim Ji-hee] The biggest issue in the imported car market recently is the news of Korea Nissan's withdrawal. Although it was said to be a sudden measure taken after being hit hard by the boycott of Japanese products following the Korea-Japan export regulations in July last year and the COVID-19 pandemic, Nissan has since become a brand whose every move has become a hot topic. It’s almost ironic to think how much attention it received before officially announcing its withdrawal.

The first and most notable topic was undoubtedly the 'tearful discount.' In fact, since Nissan’s withdrawal was confirmed, discount promotions to clear out inventory were an expected step. However, the discount rates far exceeded expectations. The Nissan brand’s midsize sedan Altima, which started the discount first, offered discounts ranging from 10 million to 13.5 million KRW depending on the trim, and the Maxima had a discount of 14.5 million KRW. Being able to purchase an Altima, which was sold for 30 to 40 million KRW, cheaper than the domestic compact sedan Avante naturally sparked a very enthusiastic response.

The inventory was sold out within a day, but the unprecedented massive discount seems to have left a strong impression on excited consumers. Even though dealerships no longer accept contracts, there are still many consumers who call or even visit in person, hoping to catch any canceled contracts. However, since there are already many people on the waiting list, it is difficult to get on it. Some customers who had already paid deposits even had their contracts canceled due to lack of inventory and had to leave empty-handed.

There are also those who could not smile while watching the 'Nissan battle.' These are the owners who purchased Nissan vehicles just before the withdrawal news was announced. Their joy of buying a new car was short-lived as they received the shocking news that their car brand would be leaving the domestic market. Without even having time to worry about the 8-year guaranteed after-sales service (AS), the used car prices dropped sharply within days. Now, with new car prices also dropping, it’s like adding fuel to the fire. There are even rumors that angry owners are considering a class-action lawsuit.

In the imported car industry, interest is as high in the remaining 40 or so Korea Nissan employees as it is in the discounts. Korea Nissan has been operating a program that allows non-sales headquarters employees to transfer to branches in Thailand and other countries. This program is still valid. However, it is not easy to relocate overseas immediately, so realistically, it is difficult to utilize this program. The fact that Nissan as a whole is struggling in the global market, not just in Korea, is also a source of concern. Korea Nissan, preparing early retirement programs, is said to be closing its doors while paying employees consolation bonuses equivalent to twice their severance pay.

Nissan dealer employees are equally confused by the sudden news. Earlier this year, Korea Nissan carried out restructuring and terminated many contracts with dealers. Currently, only about three contracts remain. In the past, they might have tried to find reemployment with other imported car brands such as the German Big Three, but due to the market slump caused by COVID-19, it is uncertain whether other imported car dealers will be hiring.

Since entering Korea in 2004, Nissan has released fairly significant models such as the Altima and Maxima, establishing a considerable presence domestically. The widespread attention continuing since the withdrawal announcement seems to be an extension of the presence it has shown over the past 16 years.

This content was produced with the assistance of AI translation services.