Nissan has lowered its profit forecast for the fiscal year ended in March due to missed global sales targets.
The Japanese automaker revealed the adjustment on Thursday, cutting its 2023 net profit estimate from its initial $2.52 billion to $2.39 billion. The new forecast is lower by about 5% compared to the original, driven by a 14.5% reduction in Nissan’s operating profit.
The company attributed the sudden change to slow sales, which were driven by a multitude of factors. During a press conference, Nissan CEO Makoto Uchida cited aggressive competition in the U.S., where the car brand has struggled to retain market share under pressure from domestic brands and other Asian manufacturers.
Uchida also said an earthquake in Japan at the start of the year, combined with shipping complications related to the conflict in the Red Sea, disrupted vehicle production and deliveries, further eroding sales volumes. Nissan now expects to sell 3.44 million units, down from a previously-revised 3.55 million.
Despite the market’s challenging conditions, the automaker’s new net profit forecast is still well ahead of its 2022 earnings of $1.44 billion.
In March, Nissan introduced its new “Arc” growth strategy, which called for an additional 1 million units in annual sales and a 30% reduction in electric vehicle manufacturing expenses. While the brand has been unable to keep up with competitors in the electrified segment, its plan would also introduce 30 new models over the next two years, more than half of which would be either fully electric or hybrid.
