Carmaker expects 43% profits slump amid problems including Carlos Ghosn civil actions
Nissan slumped to its first quarterly loss since 2010 as weak sales added to the problems faced by the automotive manufacturer, amid continued battles with its former chairman Carlos Ghosn.
The Japanese carmaker reported a net loss of ¥26.1bn (£183m) between October and December, and also said it would not pay out a dividend at the end of its financial year.
It expects profits to slump to ¥85bn (£596m) for the financial year ending 31 March, 43% down on the previous year.
The lowered outlook came as revenues and operating profits fell steeply for the first nine months of its financial year. Revenues were down by 12.5% between April and December, while operating profits plummeted by 82.7% to ¥54.3bn.
The company blamed “weak performance and a slowdown in total industry volume” for the slump, which has added to the pressure on its new chief executive, Makoto Uchida.
“We are making progress, but sales volumes have been weak so we need to do more restructuring than initially planned,” Uchida said.
Nissan is battling a host of problems, including a sales slump linked to an ageing product lineup and heavy discounting. It also faces the need, shared by all major carmakers, to conserve cash as it invests heavily in electric and autonomous vehicle technology. The company is cutting 12,500 jobs worldwide, in a plan announced in July.
The impact of the coronavirus outbreak has not yet been factored into its forecasts. Car sales are all but certain to slump in China, and Nissan has said that it will temporarily halt production at a plant in Kyushu, in Japan, because of strain on supply chains, on top of shutdowns in Chinese factories.
The company has been dogged by problems triggered by Ghosn’s departure, with Uchida having to cope with political manoeuvring between Nissan and its partners in the world’s biggest carmaking alliance, France’s Renault and Japan’s Mitsubishi.
Nissan has been distracted by the saga surrounding the arrest and subsequent dramatic escape of Ghosn, who was the driving force behind the alliance.
Ghosn was arrested in November 2018 after Nissan executives reported him to authorities over allegations he had understated his income. However, he escaped from Tokyo by private jet to Lebanon, avoiding a trial, and has since railed against perceived injustice, blaming “unscrupulous, vindictive individuals” at the carmaker for conspiring to bring him down, as well as likening his case to the Pearl Harbor attacks.
Nissan is now pursuing Ghosn in civil actions to try to recover costs it said were related to corruption. Ghosn has denied all the claims.