Nissan predicts a 38% increase in annual profits due to improved sales prospects.

Nissan Forecasts 38% Rise in Profit Despite Headwinds in China

Nissan Motor Co has announced a better-than-expected 38% rise in profit this year, thanks to stronger sales in North America and Europe. The bullish forecast comes as Nissan retools its alliance with Renault and faces headwinds in China, where local players are posing an increasing challenge with the rapid roll-out of battery-powered electric vehicles. The automaker needs to “break away” from conventional methods and shift to a more flexible structure to respond better, according to CEO Makoto Uchida. Nissan is now seeing that the switch to EVs in China comes from consumers themselves and is not just driven by issues such as incentives and number plate restrictions, said COO Ashwani Gupta. The company has to speed up the way it designs, manufactures and sells cars in China, he added.

Positive Sales Outlook

Nissan sees operating profit rising to 520 billion yen ($3.85 billion) in the financial year that started last month, compared with an average profit forecast of 396.21 billion yen in a poll of 19 analysts by Refinitiv. The improved sales outlook is driven by expectations to sell 29% more cars in North America, or 1.32 million vehicles, and 27% more in Europe. In China, Nissan expects volumes to rise 8% to 1.1 million vehicles. A positive contribution to the upbeat forecast also comes from a better outlook for materials prices, which will help offset pressure from a stronger yen.

Growth Plans in EVs and Software

Nissan is developing growth plans in areas such as software and EVs independent of Renault, sources have said, as the two companies work to finalise the terms of their rebalanced alliance by mid-year.

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