Japanese automaker Nissan lowers its profit forecast amid incentive, inventory woes
Nissan has lowered its full fiscal year outlook after the Japanese automaker reported a 73% decline in profit in the April-June quarter compared to the previous year
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.Nissan lowered its full fiscal year outlook on Thursday, as the Japanese automaker reported a 73% decline in profit in the April-June quarter compared to the previous year.
Chief Executive Makoto Uchida called the results “very challenging,” blaming sales incentives and marketing expenses resulting from intense competition, especially in the U.S. market.
Nissan’s stock price plunged on the Tokyo Stock Exchange after the earnings were announced, finishing down nearly 7%.
The profit challenges came despite its global vehicle sales holding steady at 787,000, according to Nissan Motor Co., based in the port city of Yokohama.
Quarterly sales edged up 3% to 2.99 trillion yen ($19.6 billion).
The need to optimize inventory also chipped away at profitability. Nissan’s fiscal first quarter profit declined to 28.6 billion yen ($187 million) from 105.5 billion yen the previous year.
“Our first quarter results were very challenging. The reasons are clear, and we have implemented measures to recover,” Uchida said.
Nissan said it will improve inventory so sales and profits will recover in the second half of the fiscal year. New models are also in the pipeline, according to the maker of the Altima sedan, Z sportscars and Infiniti luxury models.
Nissan lowered its full-year profit forecast to 300 billion yen ($1.9 billion) from an earlier projection of 380 billion yen ($2.5 billion).
It expects to sell 3.65 million vehicles globally in the fiscal year ending in March 2025. In the fiscal year that ended in March 2024, Nissan sold about 3.4 million vehicles worldwide.
Nissan has been focusing on a sales growth strategy called “The Arc” based on electric vehicles. But its performance is ailing in key markets such as the U.S. and China.
The global auto industry is undergoing turmoil amid growing concerns about sustainability and the environment, as consumers turn to EVs, fuel cells and other green models. Drivers are also looking to the use of artificial intelligence and other technologies for safer and cleaner driving.
Such changes mean opportunities for newcomers, including various Chinese makers, as well as Tesla of the U.S., while bringing risks for established automakers like the Japanese.
Japan’s top automaker, Toyota Motor Corp., reports financial results next week. Honda Motor Co. reports early next month.
Nissan is promising to mass produce electric vehicles powered by next-generation batteries by early 2029.
___
Yuri Kageyama is on X: https://twitter.com/yurikageyama