Yulon Nissan Motor Co (裕隆日產), which distributes Nissan and Infiniti vehicles in Taiwan, yesterday said that a spike in COVID-19 infections would dent local automobile sales this quarter as people are opting to stay at home amid restrictions on public movement.
“We expect the pandemic to impact car sales in May, June and July. At this stage, it is premature to say how big the impact will be,” Yulon Nissan spokesman Joseph Hsiung (熊金鐸) told an online investors’ meeting. “It will hinge on whether the government will impose more stringent measures to curb the infections.”
The Central Epidemic Command Center on Tuesday extended a level 3 COVID-19 alert to June 14, as the number of new daily cases remains high.
Photo: Amy Yang, Taipei Times
The nationwide soft lockdown has reduced the number of showroom visitors and vehicle sales this month, Yulon Motor Co (裕隆) vice president Lee Chien-hui (李建輝) said.
Addressing investors’ concerns about the effects of an auto chip shortage, Lee said that Yulon Nissan and Yulon Motor’s own-brand Luxgen Motor Co (納智捷汽車) have increased their chip stockpiles since the beginning of this year to ensure sufficient supply.
There would be no supply issue until July, he said.
The issue at stake is the increase in manufacturing costs caused by price hikes of key components and raw materials, including precious metals, and higher shipping costs, Yulon Nissan said.
The firm has not passed the increasing costs on to buyers yet, but is cautiously evaluating the feasibility of raising prices, Hsiung said.
“We are under mounting pressure to hike prices,” Hsiung said. “Components used in new models are pricier [than for older ones]. Besides, container and shipping costs have been climbing.”
Increases in manufacturing costs pushed the company’s gross margin to 11.3 percent last quarter, compared with 14.4 percent during the same period last year, Hsiung said.
Yulon Nissan maintained its projection last month that new vehicle sales in Taiwan would drop about 3.83 percent to 427,000 units this year, from 440,000 units last year.
However, it would benefit from a recovery in the Chinese auto market, Hsiung said.
Dongfeng Nissan Ltd (東風日產), its joint venture with China’s Dongfeng Automobile Co (東風汽車), aims to sell 1.28 million vehicles in China this year, up about 5.79 percent from 1.21 million units last year, he said.
Dongfeng Nissan’s sedan sales surged 60.5 percent year-on-year to 295,000 units last quarter, he said.
The company is also looking to introduce more electric models, including the second-generation Leaf model and hybrid system developed by Nissan, Hsiung added.
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