Nissan’s prospects brighten as China rebounds, but struggle ahead for weakened car maker
Nissan Motor Co could trim its forecast for a full-year loss when it reports quarterly results on Thursday, analyst estimates show, as a recovery in China marks a rare bright spot for the Japanese automaker weakened by scandal and the pandemic.
Nissan’s second-quarter results are likely to highlight how it is falling further behind domestic rivals Toyota Motor Corp and Honda Motor Co Ltd, both of which last week raised their profit estimates thanks partly to an uptick in demand from China, the world’s largest auto market.
While China’s rebound from the pandemic is proving a boon for Japanese automakers, Nissan is still struggling in North America, where it is hampered by an ageing vehicle line-up.
“A recovery in China is perhaps encouraging, but certainly not a panacea for Nissan’s overall troubles. The key to recovery is North America, where the majority of problems stem,” said Julie Boote, an analyst at Pelham Smithers Associates in London.
Toyota and Honda “are currently doing even better than Nissan in China; but, most importantly, neither of them have the same issues as Nissan has in North America,” she said.
Twenty-three analysts surveyed by Refinitiv estimate an average operating loss of 335 billion yen ($3.2 billion) for the full year, 28% less than Nissan forecast in July, as the pandemic raged.
Toyota and Honda both more than doubled their forecasts last week to a 2.47 trillion yen operating profit and 420 billion yen gain respectively.
Vehicle sales in China, the world’s biggest auto market, expanded 12.8% year-on-year in September for a sixth straight monthly gain. That recovery shows signs of taking hold in the United States too.
