It’s no secret that Nissan has been struggling lately. After a savage management reshuffle that involved headlines around the world focusing on the company’s elusive former CEO Carlos Ghosn, the brand’s ill fortunes have worsened and dealers are not happy. not.
To help mend those relationships, the Japanese automaker is reportedly incentivizing U.S. dealerships to sell incentive customers and give them longer loan terms, according to CarsDirect. According to a bulletin reportedly sent to Nissan’s dealer network, if buyers take advantage of promotional financing options, stores can get a kickback equal to 1% of the loan amount, a significant portion of the change on more expensive models.
The loans in question could last up to 84 months, or seven years. Interest rates are also high in some cases, CarsDirect reporting that the rate for a 72-month Sentra was 14.9% with credit scores below 620 – a subprime rating.
Nissan isn’t the only brand to have dealerships that prefer financing, of course. Some buyers of new Chevy C8 Corvettes have also found themselves pressured to finance their new cars. It’s an easy way for dealers to make money without marking up the price of vehicles, as they usually get a kickback from a lender to steer customers in their direction.
The Japanese automaker’s plan to reward dealers who sign extended financing agreements with their customers isn’t good for everyone. The incentive will likely cause sellers to steer consumers toward more expensive vehicles with unnecessarily long financing periods using the lure of lower payments. This could reduce the number of cheap cars kept on the lots and increase the amount of money people will eventually have to pay for their vehicles.
Subprime loans are already a top priority for Nissanand with this new push to give dealers a bribe for more profitable loan terms, that’s something to keep in mind. The reader has contacted Nissan for comment and will update this space with its response.
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