Nissan to reach sales target this financial year

PARIS (Reuters) - A top executive at Nissan Motor Co said on Thursday Japan's No.3 automaker was still on track to meet its sales target of 3.9 million vehicles this business year despite a sharp downturn in many key markets.

Nissan, held 44 percent by Renault SA, projected in May its global vehicle sales would grow 3.5 percent in the year to end-March 2009, mainly with growth in Russia and other emerging markets.

"So far we still think 3.9 million is reachable," Executive Vice President Carlos Tavares told Reuters in an interview at the Paris Motor Show. "Of course if everything collapses in the next months we need to acknowledge that."

Nissan's global sales were up 5 percent in the first six months to the end of September.

With U.S. and European markets sinking and growth slowing sharply even in China, India and Russia, most automakers are pessimistic about sales and profit targets for this year. Many expect the European market to be weaker still in 2009.

Nissan has many projects in the pipeline to attack new markets such as India and Brazil over the next few years under a four-year business plan to 2012.

Tavares said he felt good about the prospects for those projects, including joint production of a new entry-level car in India with Renault in 2010 and a 50,000-units-a-year car factory in Russia due to open early next year.

But he added that Nissan needed to be "very cautious" about spending money in the current industry and economic conditions.

"We are putting a hell of a pressure to make sure that the efficiency of investments is there. This being said, if it gets worse we will not hesitate to readjust whatever we have to readjust," he said.

Tavares said the new entry-level car would also be built in China. Nissan had said it would choose five low-cost production sites for the model, and had named only India and Thailand so far. The car would cost between $8,000 and $12,000, he said.

He added that a $3,000 car to be developed with Renault and India's Bajaj Auto Ltd also made sense more than ever as consumers sought cheaper cars and because of expectations that raw materials prices would fall as global vehicle demand weakened.