Nissan's (NASDAQOTH:NSANY) luxury brand Infiniti this week gave the world more details about its intriguing Q50 Eau Rouge, a concept version of a high-performance luxury sedan.
And those details got the world's attention.
Infiniti had shown off the outside of the Eau Rouge in Detroit in January. But at the Geneva International Motor Show this past week, things got really interesting when the company unveiled the Eau Rouge's engine, one that came straight out of Nissan's GT-R supercar: a 3.8-liter twin-turbo V6 making a whopping 560 horsepower.
That's big-league power. That's comparable to Cadillac's mighty CTS-V and BMW's (NASDAQOTH:BAMXF) all-conquering M5, two of the fastest sedans ever built -- and it makes a serious statement about where Nissan is taking its luxury brand. Just as General Motors (NYSE:GM) is making a big push to turn Cadillac into a global luxury brand, Nissan is doing much the same with Infiniti.
And as Fool contributor John Rosevear explains in this video, a decision to build the Eau Rouge with that tremendous V6 would instantly bring a lot of car-enthusiast credibility to Infiniti's efforts, and it could end up serving as a much-needed flagship for the brand.
A transcript of the video is below.
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John Rosevear: Hey Fools, it's John Rosevear. When we talk about automakers and profits these days, we often talk about luxury cars. Globally speaking, luxury cars are a fast-growing business, in part because of a boom in demand in China, and since they tend to be higher-profit products than mainstream vehicles, we've seen several automakers push to expand their luxury offerings.
The most visible one for us here in the U.S. has probably been Cadillac, GM has made huge strides in its effort to put Cadillac on the level of BMW and Mercedes, but there's a similar effort under way at Nissan. Nissan is spending big bucks to turn its Infiniti brand, which was originally launched as kind of a me-too imitation of Toyota's (NYSE:TM) Lexus for the U.S. market, they want to turn Infiniti into a global luxury-vehicle powerhouse. Infiniti has a slew of new models under development, and Nissan has big plans to greatly expand the brand's presence in China and Europe, right in BMW's backyard.
Their latest move was revealed this past week at the Geneva International Motor Show, it's the Infiniti Q50 Eau Rouge sedan. Now "Eau Rouge" means "red water" in French, that may not mean anything to you, but it's the name of one of the most famous corners on one of the world's most famous racetracks, the Spa racecourse in Belgium, very famous and important Formula 1 track. So this is a name that connotes serious high performance with a European accent.
Now the Q50 Eau Rouge wasn't actually unveiled this week, we saw this car at the North American International Auto Show in Detroit in January, and it looked pretty good but Infiniti didn't tell us all that much about it at the time so we didn't pay all that much attention. The big news in Geneva is that they revealed the Eau Rouge's engine, and it's a doozy.
It's a twin-turbo version of Nissan's excellent V6, 3.8 liters, and it's got 560 horsepower. That's a lot. That's BMW M5 and Cadillac CTS-V territory, and these are among the fastest sedans ever built. So Infiniti is making a big statement here. They say the Eau Rouge will be all wheel drive, it'll have a 7 speed gearbox, and it'll go zero to sixty in under 4 seconds and top out at around 180 miles per hour.
For a luxury sports sedan, that's the big leagues.
Now, assuming they build this thing, it's not going to sell in big numbers, it's not going to add billions to Nissan's global bottom line. But it's still really important. Just as BMW's M cars, the M3 and M5 and so forth, they pack extreme performance at a high price, and BMW doesn't sell all that many, but the fact that they exist makes the rest of the BMW line seem that much more desirable.
These are halo cars, they're an important part of the image of the overall BMW brand. Cadillac caught on to this a while ago. When they released the second-generation CTS-V in late 2008, it was the fastest production four-door car in the world, they could back that up, and it was a great product for the time, auto critics drove it and raved about it, and this was all at a moment when GM was going down the tubes, but it really was key to putting Cadillac on the map of people who weren't accustomed to looking past the German luxury brands.
Clearly that's what Infiniti wants to do with the Eau Rouge. Officially it's just a concept car right now, we don't know if they're going to build it, when they'll build it, or what it'll cost, but it seems clear that the Infiniti brand could really benefit from a car like this in terms of raising awareness with car enthusiasts around the world, and I think it's a matter of "when", not "if". Thanks for watching, and Fool on.
John Rosevear owns shares of General Motors. The Motley Fool recommends BMW and General Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.