Fri, Jun 24, 2011 - Page 10 News List

Nissan expects 15% drop in profit this fiscal year

RESILIENT:In spite of the production disruptions caused by the earthquake and tsunami, Nissan sees global sales this year rising 9.9% to 4.6 million vehicles

AP, YOKOHAMA

Nissan Motor Co is forecasting a 15.4 percent drop in profit for the fiscal year ending March next year because of production disruptions from the March quake and an unfavorable exchange rate.

However, despite the disaster in northeastern Japan that battered production earlier this year, the Japanese automaker is expecting to sell more cars around the world, with volumes rising 9.9 percent year-on-year to 4.6 million vehicles.

“Continuous growth in 2011 will bring Nissan a new record volume,” Nissan president and chief executive officer Carlos Ghosn said yesterday.

“The unrelenting work ethic of Nissan employees is an inspiration, particularly after one of the worst natural disaster in modern history,” Ghosn said.

Nissan, Japan’s second-largest automaker after Toyota Motor Corp, said its profit would drop to ¥270 billion (US$3.4 billion) for the fiscal year through March next year from ¥319 billion the previous fiscal year.

Sales are expected to edge up 7.1 percent to ¥9.4 trillion.

Nissan, allied with Renault SA of France, said it expected to sell more vehicles for the fiscal year in all major global regions.

Its vehicle sales are expected to grow 1.7 percent in Japan, 6.8 percent in North America, 10.4 percent in Europe and 12.3 percent in China, it said.

The maker of the March subcompact, Leaf electric vehicle and Infiniti luxury models said production had been disrupted by a parts shortage after the quake and tsunami destroyed key suppliers. However, it has mostly recovered and will be back to normal by October, according to Nissan.

Nissan said the strong yen erased ¥135 billion from its operating profit. The rise in material costs remains a risk this year, as do worries about a global slowdown and an electricity shortage in Japan after nuclear power plants were either damaged or shut down after the March 11 disaster.

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