- NEWS Desk Global
NISSAN CUTS ANNUAL OPERATING PROFIT ESTIMATE BY 14.5% ON LOWER SALES
Nissan Motor announced on Friday a 14.5% reduction in its annual operating profit forecast, citing lower-than-anticipated vehicle sales and other contributing factors. The third-largest automaker in Japan by volume now expects an operating profit of 530 billion yen ($3.43 billion) for the fiscal year ending in March, down from the previous estimate of 620 billion yen. Similarly, its net profit estimate has been revised to 370 billion yen, compared to the initial projection of 390 billion yen.
Nissan attributed the downward revision to several factors, including weaker-than-expected vehicle sales, which are now forecasted to reach 3.44 million units for the year. This adjustment comes just two months after a previous downward revision to 3.55 million units, primarily due to underperformance in the Chinese market. CEO Makoto Uchida stated that intensified competition in the U.S. market, the impact of the New Year's Day earthquake on Japan's Noto peninsula, and disruptions in shipping in the Red Sea all contributed to the decline in sales. Additionally, Nissan's quarterly sales were affected by unexpectedly high demand for hybrids in the U.S., a trend that has favored rival Japanese automaker Toyota. The downgrade in profit forecast also reflects Nissan's decision to provide support to suppliers, as the company found it challenging to meet its original sales targets for certain models under its mid-term business plan.