Nissan to set out survival plan after expected annual loss

By Naomi Tajitsu TOKYO (Reuters) - Nissan Motor Co will unveil its plan to become a smaller, more cost-efficient automaker on Thursday as it looks to recover from four years of tumbling profits which are set to culminate in its first annual operating loss in 11 years. The Japanese carmaker's second recovery plan in less than a year will outline how it will slash fixed costs, streamline its products and shore up cash as it reels from a plunge in sales as the coronavirus pandemic hits demand for cars. Nissan said in April that it expected to post an annual operating loss of up to 45 billion yen (340.3 million pounds) when it announces its results for the year to March 31 at 0800GMT on Thursday, which would be its worst performance since 2008/09.

Reuters May 28, 2020 06:06:08 IST
Nissan to set out survival plan after expected annual loss

Nissan to set out survival plan after expected annual loss

By Naomi Tajitsu

TOKYO (Reuters) - Nissan Motor Co <7201.T> will unveil its plan to become a smaller, more cost-efficient automaker on Thursday as it looks to recover from four years of tumbling profits which are set to culminate in its first annual operating loss in 11 years.

The Japanese carmaker's second recovery plan in less than a year will outline how it will slash fixed costs, streamline its products and shore up cash as it reels from a plunge in sales as the coronavirus pandemic hits demand for cars.

Nissan said in April that it expected to post an annual operating loss of up to 45 billion yen (340.3 million pounds) when it announces its results for the year to March 31 at 0800GMT on Thursday, which would be its worst performance since 2008/09.

The automaker sold 4.8 million vehicles in its latest financial year, the second decline in a row and a fall of 13% from last year, knocking it off its perch as Japan's second biggest automaker to trail Toyota <7203.T> and Honda <7267.T>.

The plan will follow a new strategy announced by Nissan and its partners Renault SA and Mitsubishi Motors Corp <7211.T> on Wednesday to work more closely on developing and producing cars to reduce costs and ensure the group's survival.

Even before the spread of the coronavirus, Nissan's sales and profits had been slumping, forcing it to row back on an aggressive expansion plan pursued by ousted leader Carlos Ghosn.

The pandemic has only piled on the urgency and pressure to renew its efforts to downsize.

Nissan's operating profit has tumbled for four consecutive years as its pursuit of market share, particularly in the United States, led to overcapacity at its car plants, steep discounting and a cheapened brand.

The three-year strategy will lay out a path to sustainable profitability and is the vision of Chief Executive Makoto Uchida and Chief Operating Officer Ashwani Gupta, who took over after months of internal turmoil following Ghosn's arrest in 2018.

Under the plan, Nissan will curb its ambitions for sales growth to target annual sales of about 5 million units, Reuters reported in April, a cut from a previous goal of 6 million cars outlined in July by then-CEO Hiroto Saikawa.

Another top priority will be the preservation of cash. As of December, Nissan's automotive operations had negative free cash flow of 670.9 billion yen, a more than six-fold increase from a year ago.

(Reporting by Naomi Tajitsu; Editing by David Clarke)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

Aurora Cannabis plans more layoffs, facility closures amid industry turmoil
Business

Aurora Cannabis plans more layoffs, facility closures amid industry turmoil

By Arunima Kumar (Reuters) - Aurora Cannabis on Tuesday announced a new round of staff reductions and plans to shut five facilities over the next two quarters, as the COVID-19 pandemic pummels the cash-crunched cannabis industry. For most marijuana companies in Canada, which legalized recreational cannabis in October 2018, profits have proven elusive due to fewer-than-expected retail stores, cheaper rates on the black market and slow overseas growth. The industry has been further hit by the COVID-19 crisis, which has also upended financial markets, making it harder to get investor dollars

India levies charge on some steel imports from China, Korea, Vietnam
Business

India levies charge on some steel imports from China, Korea, Vietnam

NEW DELHI (Reuters) - India has imposed an anti-dumping duty on flat rolled steel products that are plated or coated with alloy of aluminium and zinc originating in, or from China, Vietnam and South Korea, according to a government order https://www.cbic.gov.in/resources//htdocs-cbec/customs/cs-act/notifications/notfns-2020/cs-add2020/csadd16-2020.pdf issued on Tuesday. The duty will be in the range of $13.07-$173.10 per tonne for 5 years, according to the statement

Gold vaults to highest since October 2012 as dollar stumbles
Business

Gold vaults to highest since October 2012 as dollar stumbles

By Diptendu Lahiri (Reuters) - Gold prices surged to their highest since October 2012 on Tuesday, driven by a weakness in the U.S. dollar and widespread monetary stimulus packages by central banks as a jump in coronavirus cases dents the economic outlook