Nissan swings to a first-quarter profit as auto demand recovered in North America

Article by Christian Andrei, on August 27, 2010

As auto demand continued to recover in North America and as sales surged in Asia, Nissan Motor Co. was able to record a first-quarter profit. In a statement, Nissan revealed that it had net income of 106.6 billion yen ($1.22 billion) for the quarter that ended on June 30, compared with a 16.5 billion yen loss a year earlier.

These results exceeded the 58 billion yen average of three analysts surveyed by Bloomberg as sales increased to 2.05 trillion yen from 1.5 trillion yen.

CEO Carlos Ghosn said that Nissan's global sales are expected to rise by 8% this fiscal year.

The increase will be boosted by the launch of 10 new models, including the Leaf electric car and the March compact. In China, its sales rose by 68% when compared to the same period the previous year.

While in Japan, sales were boosted due to government subsidies. Hiroaki Osakabe, a fund manager at Tokyo-based Chiba-gin Asset Management Co., said that in Japan and China, Nissan's sales are "growing very well" when compared to that of rivals Honda and Toyota.

Nissan intends for its March car to start selling in China next month and for its annual production capacity in the nation to increase by nearly 70% to 900,000 units by 2012.

When it comes to Asian sales (excluding Japan), a 62% increase was reported in the quarter to 308,000 vehicles.

In Japan, sales rose by 19% to 138,000 units. Sales in North America increased by 23% to 278,000 units. In a statement, Ghosn said that market conditions continue to be "challenging" but that its performance indicates the "strong demand" for Nissan's products.

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