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Nissan Yearly Forecasts Down 20% as China Sales Plunge

5 years ago30 views

The East China Sea islands dispute continues to hit Japanese companies trading in China hard. On Tuesday, carmaker Nissan downgraded its profit forecast by US$1 billion to US$3.99 billion. Nissan says the territorial dispute and the ensuing anti-Japanese sentiment were the primary reasons for the downgrade.

Nissan's Chief Operating Officer Toshiyuki Shiga reported on Tuesday a huge fall in sales in China due to the current political situation. Shiga said that the company expects to sell 175,000 fewer vehicles through March in China compared to earlier estimates.

Toyota, Honda and Nissan, Japan's three largest automakers, have all announced lower actual and forecast sales in China due to the territorial dispute. But Nissan has the greatest exposure to the Chinese market, making over one-quarter of its sales there.

[Toshiyuki Shiga, Nissan's Chief Operating Officer]
"Despite the recent political tension between Japan and China, the Chinese market is unchangingly important for us."

Globally, Nissan has actually seen an 8% increase in profit for the quarter and stronger sales for the year. However, these increases are not enough to cover the losses in China.

While the current forecast is gloomy, Shiga sees signs of turnaround.

[Toshiyuki Shiga, Nissan's Chief Operating Officer]
"We are gradually seeing signs of recovery in China. Customers are gradually coming back to dealerships."

At the end of Tokyo trading on Tuesday, Nissan shares closed 2 percent down.

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