Nissan cuts N.A. outlook on concerns over supply
YOKOHAMA, Japan -- Nissan Motor Co. said operating profit in North America slid 2 percent in the July-September quarter as the company cut its full-year outlook for the region because of concerns about vehicle availability.
Nissan also lowered its forecasts for global sales, revenue and profit. The global picture was hurt by a slowdown in China and a consumer backlash against Japanese products there in the wake of a Sino-Japanese dispute over islands in the South China Sea.
China is Nissan's top market, representing 27 percent of the company's sales. The full impact of the China damage will come through in the October-March fiscal second half, Nissan said.
In North America, operating profit fell to ¥59.5 billion, or about $763.8 million, in the fiscal second quarter ended Sept. 30, from $777.9 million in the year-earlier period, as unit sales rose 5 percent to 365,000 vehicles.
But looking ahead, Nissan tempered its expectations for North America. It now expects to sell 1.495 million vehicles in the region in the fiscal year ending March 31, down from the 1.52 million it had forecast in May but up 7 percent from actual sales in the prior fiscal year.
Nissan cut its U.S. sales outlook by 25,000 vehicles to 1.175 million in the current fiscal year, in part because of shortages of the mid-sized Altima. The new outlook represents a 9 percent advance over last year.
Nissan COO Toshiyuki Shiga said his company was taking a more conservative outlook in North America amid concerns that supply constraints might undermine the more ambitious goal.
"We are operating at maximum capacity utilization in North America. We cannot go beyond that," Shiga said. "With regard to the supply of the Altima, we are envisioning some slight negative impact. That supply risk is there."
In China, Shiga said, "We are gradually seeing signs of recovery. Customers are gradually coming back to dealerships." He added that Nissan's China market share dipped to 6.3 percent in July-September from 7.5 percent in January-June.
He said visitors to the company's China dealerships were back to around 80 percent of the levels before the dispute, and orders were running at about 70 percent.
In the latest quarter, Nissan's global net income grew 8 percent to $1.36 billion from $1.26 billion a year earlier, while operating profit rose 4 percent to $2.14 billion.
Revenue increased 6 percent to $30.9 billion. Global unit sales rose 8 percent to 1.266 million vehicles.
Reuters contributed to this report
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