YOKOHAMA: For the 2019 full fiscal year, Nissan Motor Company has reduced its global vehicle sales forecast by 5.4% from the initial to 5.24 million units.

Nissan is progressing steadily towards its business transformation and profit recovery. However, operating profit for the first half is behind the original plan. In addition, the yen has strengthened against Nissan’s original assumption of 110 yen to the U.S. dollar set at the beginning of the financial year. Furthermore, Nissan foresees ongoing economic uncertainties and slowdown in total industry volume. In consideration of these factors, Nissan has revised its forecast for the full fiscal year.

Nissan Motor Co., Ltd. today announced financial results for the six-month period ending September 30, 2019. In the first half of the fiscal year, consolidated net revenue was 5.00 trillion yen, consolidated operating profit was 31.6 billion yen, with an operating profit margin of 0.6%.

First half net income decreased by 73.5% to 65.4 billion yen. In the second quarter of the fiscal year, consolidated net revenue was 2.63 trillion yen, consolidated operating profit was 30.0 billion yen, with an operating profit margin of 1.1%. Second quarter net income decreased by 54.8% to 59.0 billion yen.

Major factors in the decrease were external, such as exchange rate fluctuations, regulatory compliance expenses, and increased raw material costs, combined with increased quality-related costs.

Although decreased vehicle sales volume had a large effect on first-quarter profitability, in the second quarter the decline was offset by decreases in selling expenses, thereby resulting in a positive contribution to profit.

One pillar of Nissan’s business transformation plan is the recovery of U.S. operations, where benefits are starting to be seen from efforts to improve quality of sales. For the second quarter, operating profit for North America was close to the previous year’s level.

In the first half of fiscal year 2019, global total industry volume decreased 5.9% to 43.85 million units, while Nissan’s global unit sales decreased 6.8% to 2.50 million units.

In Japan, Nissan’s sales decreased 1.3% to 281,000 units. The all-new Nissan Dayz continued to sell well, and the new Skyline launched in September, which features the world-first advanced driver support technology ProPILOT 2.0 and performance-enhanced turbo engine, has also been well received.

In China, where Nissan reports figures on a calendar-year basis, total industry volume decreased by 12.8%. Notwithstanding, Nissan’s sales were 718,000 units, on par with the same period of the previous year, and market share increased 0.8 percentage points to 6.2%. This was driven by continued strong sales of core models including the Sylphy sedan and the Qashqai and X-Trail crossovers.

In the U.S., due to an aged product portfolio and continuing efforts to normalize sales, sales decreased 4.3% to 679,000 units.

Nissan sales in Europe, including Russia, decreased by 19.7% to 265,000 units, amid ongoing challenging conditions due to changes in environmental regulations and an aged model portfolio.

In other markets, including Asia and Oceania, Latin America, the Middle East and Africa, Nissan’s sales decreased 11.4% to 360,000 units.