Mon, Jun 25, 2007 - Page 12 News List

Yulon Nissan lowers car sales projections

IN THE SLOW LANE The worst year in the nation's automobile industry in two decades is partly the resulf of a lukewarm economy and ever-climbing oil prices


Yulon Nissan Motor Co (裕隆日產), a Taiwanese-Japanese joint venture and the nation's third-largest automaker, cut its forecast by 11 percent for the nation's overall car sales to 320,000 vehicles this year on slow recovery from last year's trough driven by the consumer credit crisis.

The revised forecast would make this year the worst period for local automakers in two decades. Yulon Nissan had previously predicted car sales of 360,000 units this year.

Yulon Nissan also axed 27 percent of the company's car sales projections to 40,000 vehicles from the earlier 55,000, company executive Jack Wu (吳新發) said on Thursday. He made the forecast after the company's annual shareholder meeting, the Chinese-language newspaper Commercial Times reported.

Yulon Nissan announced the bearish outlook amid the nation's lukewarm economic growth and rising oil prices. Car sales plunged 29 percent year-on-year to 366,311 units last year, while GDP grew 4.62 percent. The government GDP growth forecast for this year is set at 4.3 percent.

Beginning early this year, car sales wenrt down 20 percent year-on-year to 170,000.

It would be difficult to expect a revival strong enough to offset sagging sales in the first half, the newspaper quoted Wu as saying.

To cope with the revised numbers, Yulon Motor Co (裕隆汽車), which assembles and sells cars for Yulon Nissan, said it would likely reduce daily output, but said it would not cut working hours, the newspaper reported.

Yulon Nissan will further lower costs, integrate resources, streamline its workforce while continuing to provide quality service, Yulon Group (裕隆集團) chairman Kenneth Yan (嚴凱泰) said in the report.

Yulon Nissan is planning to launch more new models, including the fuel-efficient Livina, in the second half to minimize the adverse impact on its business, Yan said.

Shares of Yulon Nissan declined 13 percent to a closing price of NT$81.8 on Friday, down from NT$94.4 at the beginning of the year.

The TAIEX benchmark index was up 11 percent on Friday.

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