Nissan, Japan’s third top carmaker, reported a ¥233,7-billion annual net loss, its first yearly loss in a decade — but expects the red ink to lessen in the current fiscal year.
”We are beginning to see some signs of improved access to credit, the impact of government stimulus packages and a gradual return in consumer confidence,” said chief executive Carlos Ghosn, while remaining cautious about the future.
”The crisis is ongoing and market conditions are still volatile,” he told reporters at Nissan’s Tokyo headquarters.
It was the first time Nissan had sunk to an annual loss since Ghosn took the helm a decade ago under an alliance with Renault SA of France, and wrested Nissan out of near-bankruptcy.
For the January to March quarter, Nissan lost ¥276,89-billion.
Chief operating officer Toshiyuki Shiga blamed the loss on three factors — the US financial crisis, the global slowdown and the strong yen.
The fiscal fourth quarter loss was larger than the annual loss because the carmaker turned a profit in earlier quarters.
But Nissan projects a smaller loss of ¥170-billion for the fiscal year through March 2010, he said.
The carmaker had recorded a ¥482,3 billion profit for the previous fiscal year ended March 2008.
The latest annual results were better Nissan’s projection in February for a ¥265-billion loss.
Analysts’ forecasts were close to Nissan’s.
But Mamoru Katou, car analyst with Tokai Tokyo Research, said Nissan was controlling losses merely by cutting costs and compared to other carmakers had fallen behind on hybrids and other models that can build toward future growth.
”It needs to have more hybrids fast,” he said.
”Consumer tastes have definitely shifted toward ecological vehicles.”
Nissan already sells hybrids in the US, but buys its hybrid system from Toyota.
Nissan has focussed more on electric vehicles, although it plans to introduce models packed with its own hybrid system next year.
Demand for such green cars is expected to pick up as governments, including the US and Japan, introduce incentives for consumers switching from fuel-guzzlers to green cars.
Also on Tuesday, Nissan said it will start making electric vehicles at its Oppama Plant in Yokosuka, just south of Tokyo, from the fall 2010, with production capacity of 50 000 vehicles a year.
Nissan plans to boost production toward what it calls ”mass-marketing” levels in 2012.
Nissan is not the only Japanese carmaker battered by the global slowdown.
Also on Tuesday, Mazda, Japan’s fifth biggest carmaker, reported a ¥71,5-billion loss for the fiscal year.
Toyota, the world’s largest carmaker, has fared worse, racking up a ¥ 436,9-billion annual loss, partly because of its size and its past success that had fuelled an ambitious expansion drive.
It projects an even bigger loss for this fiscal year.
Honda, by contrast, has done better, managing to stay in the black for the fiscal year with a ¥137-billion profit.
Nissan’s annual sales plunged 22% to ¥8,437-trillion.
That was also better than its initial sales forecast.
Worldwide, Nissan sold 3,4 million vehicles, down 9,5% from the previous year, as sales dropped in the US, Japan and Europe.
But sales grew in China, according to Nissan, which makes the March subcompact and Infiniti luxury models.
Nissan said it expects to sell even fewer vehicles — 3,08 million — in the current fiscal year.
Ghosn said the priorities for the year ahead would be to preserve cash, reduce losses and take advantage of the alliance with Renault.
He said Nissan remains focussed on its own turnaround and was not entering any projects or partnerships with General Motors.
The deal that Nissan has with Chrysler to produce vehicles for each other will be reviewed because Chrysler may emerge from bankruptcy a ”different” entity, Ghosn said. Fiat is acquiring a 20% stake in Chrysler.
Ghosn expressed hopes that demand would pick up and the yen’s strength would abate.
The global auto industry is undergoing drastic change, and the key to determining the winners is profitability, not just excellent technology and qualified engineers, he said.
”It is unclear who is going to emerge the winner,” he told reporters.
Nissan shares fell nearly 1% to ¥510. Earnings were announced shortly after trading closed in Tokyo. — Sapa-AP