Nissan cuts 2012 net profit forecast by 20% to $3.99 billion

Article by Anita Panait, on November 7, 2012

Nissan Motor Co. updated its full year 2012 forecast to reflect a 20-percent decrease in net profit to $3.99 billion. The updated figures also reflect the fiscal cost of anti-Japanese demonstrations in China, due to the current territorial dispute between the two countries. Nissan also announced that it lost a chunk of its market share in China.

Nissan’s full-year downward revision mirrors a similar move by fellow Japanese carmaker Honda, which also trimmed a fifth off its 2012 guidance. On the other hand, another Japanese rival, Toyota, revised its full-year guidance to reflect an increase in net profit. All three carmakers are selling vehicles in China, but since Toyota has less exposure in the country, the impact of the anti-Japanese protest isn’t as heavy on Nissan and Honda.

Japanese products were boycotted in China, halving the demand for vehicles manufactured by Nissan, Honda and Toyota in a country that is considered as the largest vehicle market in the world.

Of the three Japanese carmakers, Nissan is the most exposed to China, which accounted for 27 percent of its global vehicle sales in the quarter ended September. For the period, Nissan said it posted a 7.7-percent jump in profit to JPY106 billion ($1.32 billion), despite logging lower than expected car sales in the United States and Europe.

Nissan said that the full impact of the China damage will come through in the second half of 2012. According to the carmaker, a stronger yen against Russian and Brazilian currencies and higher selling costs trimmed its operating profit over the first half of its fiscal year.

Christopher Richter, senior analyst at CLSA Asia-Pacific markets, said that given the share price performance, he suspects that “a lot of the bad news is priced in already.” Richter remarked that Nissan hiked its first-half dividend by 25 percent to make the market feel a little better when it looks at its reduced earnings.

Topics: nissan, profit

If you liked the article, share on:

Comments

Recommended

Like it or not, Chevrolet may soon be offering a cheaper Camaro in hopes of competing with Dodge Challenger and Ford Mustang GT. Apart from the less expensive trim, the...
by - August 17, 2017
Recently, Porsche revealed a new Macan Turbo wearing a Performance Package and a unique Porsche Motorsport themed paint. At first look, it will remind you of the 919 Hybrid and...
by - August 17, 2017
The BMW M1 will be one of the most exclusive cars that will be showcased at the upcoming 2017 Pebble Beach Concours d'Elegance, alongside many other extravagant models. Firstly, there...
by - August 17, 2017
Aston Martin Vanquish Zagato makes its debut with a total of four variations including the Speedster and the Shooting Brake trims. As part of the limited edition model, the company...
by - August 17, 2017
Mitsubishi finally introduces the new Xpander MPV at the 2017 Indonesia International Auto Show in Jakarta Indonesia. Replacing the previous Expander, the new multipurpose vehicle will be mostly sold at...
by - August 16, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries