According to Bloomberg, Nissan Motor Co. (7201), Japan’s second-biggest carmaker, lowered its full-year profit forecast by 15 percent after demand in emerging markets slowed and recall costs mounted.
The company expects to post net income of 355 billion yen ($3.6 billion) in the year ending March 31, it said today. That’s below the Yokohama, Japan-based carmaker’s previous forecast of 420 billion yen and the 440.3 billion yen average of 18 analyst estimates compiled by Bloomberg. Profit is still projected to rise from the previous year as the weaker yen helps bolster earnings.
Chief Executive Officer Carlos Ghosn also announced an overhaul of Nissan’s management as he pursues an operating profit margin target of 8 percent by the year ending March 2017. The changes and earnings shortfall come amid slowing sales in some emerging markets and a recall of 910,000 vehicles that Goldman Sachs Group Inc. estimates will cost the company about 15 billion yen.
“The outlook in Thailand will remain quite weak this year mainly due to the lack of pent-up demand,” said Ashvin Chotai, managing director of Intelligence Automotive Asia in London. “It’s also certainly hard to be optimistic about Indonesia — it’s a market which is always going to be volatile.”
Nissan also lowered its forecasts for operating profit and revenue.
Under the management changes, Chief Operating Officer Toshiyuki Shiga will become vice chairman and remain on the board, though the COO position will be abolished.
New Lieutenants
Three new positions will be created — reporting directly to Ghosn — to fill Shiga’s void, according to the company.
Among Ghosn’s new lieutenants will be Executive Vice President Hiroto Saikawa, who will be chief competitive officer overseeing the supply chain, research and development, as well purchasing and manufacturing, Nissan said. Executive Vice Presidents Andy Palmer and Trevor Mann will also take on positions as chief planning officer and chief performance officer, respectively, the company said.
Colin Dodge, currently executive vice president, will take on a new role managing special projects and report directly to Ghosn. Kimiyasu Nakamura, president of Chinese joint venture Dongfeng Motor Co., will assume companywide responsibility for customer satisfaction, reporting to Saikawa.
The Asian Century Report 