Nissan returns to the black with annual profit
Japan's number three automaker Nissan Motor posted a return to the black Wednesday and forecast profit to more than triple this fiscal year on hopes for its new electric car and emerging market demand.Updated: May 12, 2010 14:28 IST
Japan's number three automaker Nissan Motor posted a return to the black Wednesday and forecast profit to more than triple this fiscal year on hopes for its new electric car and emerging market demand.
Nissan saw a 42.4 billion yen ($460 million) annual profit as cost-cutting efforts and sales growth in emerging markets, particularly China, helped turn around a huge 233.7 billion yen loss from the year before.
It said it expected net profit to surge 254 per cent to 150 billion yen for the fiscal year ending March 2011.
"Although we are still in crisis-mode, we are well on track to complete recovery," Nissan chief executive Carlos Ghosn said. "We continue to operate in an environment that is volatile and uncertain," he cautioned.
Nissan joins its bigger rivals Toyota and Honda in posting annual profits and forecasting large gains for the current year, painting a more upbeat outlook for a sector that was ravaged by the global downturn.
The Japanese auto industry has also faced a string of reputation-tarnishing safety recalls, with Toyota issuing notices for around 10 million of its vehicles and Honda recently recalling 412,000.
Nissan has recently recalled around 700,000 vehicles over various issues involving brake pedals, fuel gauges and airbags.
The company saw a much narrower fourth quarter net loss of 11.6 billion yen in the three months ended March, compared to a loss of 276.9 billion yen during the same period a year earlier, when the financial crisis eroded demand.
The automaker sold 3.5 million vehicles globally in the fiscal year, up three percent from the previous year.
Sales volume in China surged 38.7 per cent from the year before, and Ghosn said Nissan was moving to ramp up production to "more than one million cars a year by 2012" as the nation's booming economy drives demand.
"Our most urgent challenge (in China) is to beef up capacity in order to respond to customer demand," said Ghosn. "This is a market where we are the number one Japanese automaker."
Japan sales were up 2.9 per cent, lifted by government incentives for car buyers. Sales in the United States fell 3.8 per cent.
Nissan, which was slower than rivals Toyota and Honda to embrace fuel-efficient petrol-electric hybrids, aims to take the lead with the release of the zero-emission Leaf later this year.
The automaker, which is 43.4 per cent owned by France's Renault, last month announced a partnership with Germany's Daimler AG to exchange capital and share technological know-how in an effort to reduce costs.
The tie-up will apply to small cars, powertrain sharing, light commercial vehicles, electric cars and batteries.
Ghosn added that the company plans to extend its presence in emerging markets and "develop additional synergies in the Renault-Nissan Alliance."
First Published: May 12, 2010 14:26 IST