Nissan Motor to cut China sales outlook: sources

Bloomberg

Fri, Mar 22, 2019 - Page 10

Former Nissan Motor Co chief executive Carlos Ghosn went all-in on China by approving a plan to invest US$9 billion, yet his successor appears to be rolling that back amid signs the world’s biggest vehicle market is beginning an extended downturn.

Nissan is cutting a future target for China sales by about 8 percent, people familiar with the matter said.

Nissan and Dongfeng Motor Corp (東風汽車) now forecast their joint venture will sell 2.39 million vehicles in 2022, the end of the current mid-term plan. That is a reduction of more than 200,000 units from the previous target, the people said.

The revision is being discussed as CEO Hiroto Saikawa embarks on a program to put profitability before growth in sales volume, people familiar with the matter said, asking not to be identified because the information is not public.

That includes possibly taking a break from introducing brand-new models in China, they said.

“You need to invest to survive,” said Toliver Ma (馬守彰), a Hong Kong-based analyst at Guotai Junan Securities Co (國泰君安證券). “All players, big or small, will need a plan for their electric vehicles, especially to compete in China.”

Nicholas Maxfield, a spokesman for Yokohama-based Nissan, yesterday said the company has not made any announcements regarding changes to its China business plan.

Nissan’s venture with Wuhan-based Dongfeng said it would review the mid-term targets and might make adjustments based on market conditions.

Saikawa’s mandate to Nissan executives is to not focus on sales volume — as Ghosn did — but rather to boost profit, according to one person familiar with his thinking.