Nissan predicts profit drop on soft U.S. sales

TOKYO -- Nissan Motor Co.'s profits fell in the third quarter, which ended Dec. 31, as its U.S. sales fell short of its expectations, the automaker said today.

Nissan also cut its earnings forecast for the fiscal year ending March 31. It now expects full-year profits to drop for the first time since Carlos Ghosn became president of the Japanese carmaker.

Both operating profits and net profits now are predicted to drop by 12 percent from year-earlier levels. Last October, Nissan had predicted both would edge up 1 percent for the year.

Sales of Nissan cars and Infiniti vehicles rose in the U.S. market in the third quarter. But Nissan-brand truck sales slid 8.0 percent to 100,000. Overall, the result was a fractional increase well below what Nissan had hoped for.

"The fourth quarter recovery will be slower than we had expected," said Joji Tagawa, corporate vice-president of Nissan's treasury department. U.S. sales in the fiscal second half "will not be the double-digit increase we expected."

Nissan's sales in Europe and Japan also fell in the latest quarter. But "our profit pillar is in the U.S.," Tagawa said. The sales performance there had the biggest impact on Nissan's earnings.

Nissan won't launch any all-new or redesigned models in the United States before March 31. It will offer some minor changes in its truck lineup, such as the long-bed Titan pickup to be shown at the Chicago motor show.

Starting in April, it will launch the Altima coupe, Rogue crossover, and an all-new small Infiniti luxury crossover to be built on the G35's platform. It will show an Infiniti G coupe at the New York motor show in April, but that car isn't expected to go on sale until October.

Operating profits fell 16.6 percent to ¥183.06 billion, or $1.54 billion at current exchange rates, in the three months to Dec. 31 compared to the year-earlier period. Net income fell 22.6 percent to $877.1 million.

Revenues rose 1.8 percent to $19.67 billion. Wholesale unit sales dropped 3.2 percent to 808,324. The gain in revenues was mainly due to the yen's weakness.

A stronger dollar allows Japanese carmakers to book more yen revenues on every dollar they receive from U.S. sales.

North American operating profits slid 7.6 percent to $775.9 million, as wholesale unit sales edged up 0.4 percent to 336,319. That excludes profits on vehicles exported from Japan, which are booked as Japanese profits.

European operating profits tumbled 49.1 percent to $115.0 million, as unit sales dove 15.8 percent to 132,577. The drop came despite a sharp rise in sales in Russia.