Nissan posts quarterly loss; forecasts smaller annual decline

TOYKO -- Nissan cut its forecast for an annual operating loss by 28 percent, helped by restructuring efforts and better-than-expected sales.

Operating loss for the year to March 31 will be 340 billion yen ($3.2 billion), compared with the prior forecast for a 470-billion-yen loss, Nissan said on Thursday.

For the July-September quarter, Nissan reported an operating loss of 4.8 billion yen, compared with a 30 billion yen profit for the same period a year earlier, after sales fell due to the coronavirus pandemic.

Sales for the latest quarter fell 27 percent to 1.9 trillion yen.

Nissan raised its outlook for full-year revenue to 7.9 trillion yen.

Facing an aging lineup and suffering from a volume-focused strategy, Nissan embarked on an aggressive turnaround plan six months ago while moving past the turmoil caused by the November 2018 arrest of former Chairman Carlos Ghosn.

"Other automakers are recovering, but Nissan's recovery is weaker," said Tatsuo Yoshida, a Bloomberg Intelligence analyst.

CEO Makoto Uchida said in September that he expects Nissan to return to profitability in 2021 if the current momentum continues, thanks to demand in China bouncing back from the pandemic.

Nissan is focusing on sales in China and the U.S. and reducing its presence in Europe where it is shuttering its plant in Barcelona, Spain.

To further refresh its aging lineup, Nissan said in May that it will launch 12 new cars in the next 18 months. It plans to cut both capacity and the number of models by 20 percent and will no longer pursue volume growth to shed the legacy from the Ghosn era.

Its restructuring plan calls for the elimination of about 14,000 jobs globally, up from 12,500 announced a year ago.

Uchida told a briefing on Thursday the company had to restore the faith of suppliers and dealers. "I am committed to building models that embody Nissan-ness," he said.

"While we may have upgraded our outlook, the reality is that we are still looking a lot of red ink," Uchida said. "We need keep on the current track and prove that we can do better."

Online sales focus

As part of its drive to become leaner, Nissan will move towards online sales globally, Chief Operating Officer Ashwani Gupta said on Thursday, as more companies look to reevaluate retail space after the COVID-19 crisis.

Nissan raised its forecast for full-year global vehicles sales to 4.17 million units compared with an earlier forecast of 4.13 million units, although that still represents a decline from the previous year.

Bloomberg and Reuters contributed to this report