(Yicai) Oct. 20 -- Nissan Motor’s sales of the N7, an all-electric sedan the Japanese carmaker had high hopes for, plunged in China last month, highlighting the firm’s challenges in a fiercely competitive market as it shrinks production and struggles with delivery delays.

Sales of the N7, which is being sold below cost, fell 37 percent in September from August to 6,410 units, even less than the 6,455 sold in July, according to Nissan China’s website.

Launched in April, the N7 is a key part of Nissan’s bid to claw back market share in China’s booming electric vehicle market, with the Yokohama-based company adopting an aggressive price-for-volume strategy. While competing models start at around CNY150,000 (USD21,000) each, the starting price of the N7 is about CNY110,000.

The two main shareholders in Dongfeng Nissan, a joint venture of Nissan and China’s Dongfeng Motor Group, had to be persuaded of the need to sell the car at a loss so as to regain customers lost over the years, Takaaki Yanagi, its deputy director of product planning, said at the launch. He did not mention how much money the company is losing per car.

Nissan is also gearing up to launch its first plug-in hybrid sedan, the N6, Ivan Espinosa, the company’s new chief executive, said at Nissan China’s 40th anniversary celebration. But with Nissan’s production capacity in China shrinking, there are delivery concerns for the N7 and the N6.

Dongfeng Nissan has halted or transferred production at three factories, impacting delivery times. Output at its Changzhou plant, which accounted for about 10 percent of Nissan’s China capacity, was stopped last year. And this year its Yunfeng and Xiangyang factories in Wuhan started to make Dongfeng’s own brands, the Voyah and Dongfeng Mengshi.

This has resulted in considerable delivery delays. Buyers have posted on 12365auto, a Chinese complaints and review-sharing website, saying deliveries of their N7s were held up and their deposits were not being refunded. One buyer said he ordered an N7 in May, with the dealer promising delivery within a month, but as of September he still had not received it and has not been given a clear handover date.

The delivery times for the N7 were made public each month from July to September in Nissan China’s online sales performance updates. Last month, the company claimed that new orders would be fulfilled within two to four weeks.

Most of Nissan’s China sales are still of internal combustion engine-powered cars. In the first nine month’s of the year, its China sales fell 8 percent year on year to 457,000. Global sales may drop 2.9 percent to 3.25 million in the fiscal year 2025, mainly as a result of an expected slowdown in the Chinese market, it said.

Nissan’s sales in China have tumbled for the past six years, with just 690,000 sold last year, roughly half of what the company sold in 2021.

Editor: Kim Taylor