Nissan Motor has dismissed a Japanese media report it was likely to post a group operating loss of tens of billions of yen this financial year as sales fall and the yen appreciates.
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Sources told Kyodo News on Thursday Japan’s third-largest automaker was about to revise its current fiscal year group sales forecast and global vehicle sales target downward.
A Nissan spokeswoman described the report as “pure speculation” and declined to comment further.
If true, this would be the first time the automaker has booked a consolidated operating loss since its president Carlos Ghosn became chief operating officer in 1999 after Nissan formed an alliance with Renault to cope with financial difficulties it was facing.
The loss could become larger depending on foreign exchange rate developments, the sources told Kyodo.
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By GlobalDataNissan’s after-tax income for the first 2008/9 half to the end of September was down 40.5% year on year to JPY126.3bn due to adverse foreign exchange rates, the severe decline in the US market, provisions for risk on leased vehicles in North America and “product mix deterioration”, according to the automaker.
Net revenues fell 3.9% to 4.8693 trillion yen and operating profit was down 47.8% to JPY191.6bn.
Nissan had originally projected a JPY550bn group operating profit for the fiscal year but revised that down to JPY270bn last October, along with a reduced net profit forecast of JPY160bn, after posting the H1 results.
The sources told Kyodo a second downward revision was inevitable after Nissan’s sales shrank further in the key US market as well as in emerging economies.
Also adding pressure was the yen’s strength relative to other currencies, they told the news agency. Nissan anticipated an exchange rate of JPY100 to the US dollar for October ’08 to March ’09 but the yen has strengthened notably from the expected level.
At least Nissan Motor will not be alone. Top Japanese automaker Toyota Motor has forecast its first-ever group operating loss for fiscal 2008.
