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Nissan Motor could delay vehicle sales objective

Nissan Motor Co CEO Carlos Ghosn could delay Japan's third-biggest carmaker's business goals, including selling 4.2 million vehicles in the year ending in March 2009.

"The company will remain focused on the commitments, but may extend the time delivery," Simon Sproule, a Nissan corporate vice president in charge of public relations, said in a telephone interview yesterday, confirming a report in the Nikkei Shimbun.

"These comments were made by Ghosn," he said.

Nissan in February cut its earnings forecast for the year ended last month due to weaker-than-expected sales in the US and Japan. It was the first time Nissan missed its earnings and sales targets since Ghosn became the president in 2000. He is focusing on a plan to be announced later this month to tackle what he has called a "crisis" at Tokyo-based Nissan.

Ghosn will discuss more about the possibility of delaying the targets on April 26, when the company releases its annual earnings results, Sproule said. Nissan also plans to release its strategies to boost sales.

new focus

The Japanese carmaker will probably focus on increasing early retirements, cutting costs further in purchasing, making better use of production capacity and strengthening sales and marketing efforts -- especially in Japan and the US -- said analysts including Koji Endo at Credit Suisse Group in Tokyo.

Nissan needs to increase sales by about 700,000 vehicles over the next two years to meet its sales target of 4.2 million in the 12 months ending March 2009, which could be difficult after missing a target in the year ended last month, analysts including Endo have said.

The automaker will probably miss a 3.73 million-vehicle global sales forecast for the year ended last month, Ghosn said on Feb. 2. The carmaker in February scaled back its full-year profit forecast 12 percent to ?Y460 billion (US$3.9 billion) from ?523 billion.

The company has three business commitments under its three-year business plan dubbed the "Nissan Value-Up plan." One target is to post higher operating margin than its rivals, second is to have a 20 percent return on investment capital, which measures investment quality and the third is to sell 4.2 million vehicles in the 12 months ending in March 2009.

Ghosn, who was dispatched from Renault in 1999, led Nissan from a record loss to six consecutive record profits after becoming president in 2000.

pause

Nissan did not introduce any Nissan-brand vehicles for 15 months and went 18 months without any new Infiniti-brand models in the US, its most profitable market. During that period, Toyota released the fully redesigned Camry sedan and Yaris compact car, while Honda introduced revamped CR-V and Acura MDX sport-utility vehicles in the US.

Nissan's US sales of cars and light trucks fell 5.3 percent last year to 1.02 million, its first annual decline since 2001. The carmaker's US sales rose 3.2 percent in this year's first three months, helped by models such as the redesigned Altima sedan.

Nissan's domestic sales fell for an 18th straight month last month.

Shares of Nissan fell 1.9 percent to ?1,228 in Tokyo on Friday. The stock declined 14 percent this year compared with a 1.5 percent rise in the benchmark TOPIX index.
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