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The Success of Nissan Motor Co. in Fiscal 2023
Nissan Motor Co. experienced remarkable success in fiscal year 2023, with a substantial increase in net profit and annual sales. The Japanese automaker achieved a net profit of 426.6 billion yen ($2.7 billion), marking an impressive 92% surge. Moreover, annual sales reached 12.7 trillion yen ($81.5 billion), representing a substantial climb of almost 20%.
Challenges in Specific Markets
Despite the overall positive performance, Nissan faced challenges in certain markets, notably in China where a 5.2% decline in profits to 101.3 billion yen ($651.3 million) was recorded for the three-month period ending in March. This figure contrasted with the FactSet estimate of 70.69 billion yen ($454 billion). Sales growth was witnessed across various major markets apart from China, where Nissan encountered difficulties in competing with local rivals.
Retail sales in China experienced a notable decline of 24% to 794,000 units in Nissan’s fiscal year 2023, accompanied by a production drop of 26%, including the last two quarters which had shown positive year-over-year growth.
Strategic Shifts and Future Plans
Amidst the challenges faced in the Chinese market, Nissan’s CFO Stephan Ma emphasized the company’s strategic shift towards focusing on the internal combustion engine market rather than engaging in highly competitive sectors.1 The automaker plans to introduce new vehicles tailored to specific markets and launch a series of new-energy vehicles under “The Arc” business plan. This initiative encompasses the unveiling of 30 new models, with 16 of them being electric, and a refreshing of 60% of gas-powered vehicles by fiscal year 2026.2
Nissan is committed to increasing total car sales by 1 million units within three years, primarily driven by the launch of new electric vehicle offerings. To support this growth, the company intends to invest over $2.6 billion in battery capacity to enhance the competitiveness of its next-generation EVs.3
In an effort to achieve sustained success in the market, Nissan announced its intention to explore a strategic partnership with fellow Japanese automaker Honda Motor to collaborate on developing core components related to EVs.4
Projections for the Future
For the new fiscal year starting on April 1, Nissan anticipates global sales to rise by 7.5% to 3.7 million units and revenue to increase by 7.2%. Despite these positive forecasts, the company expects a 11% year-over-year decline in profit to 380 billion yen ($2.4 billion) through March 2025 due to high development costs. Global sales are projected to reach 3.7 million units, reflecting the company’s ambitious growth targets and strategic initiatives for the upcoming years.
- Cited from:Analysts
- Source:Nissan Global
- Nissan Global
- Reference:Nissan Global
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