Please view the main text area of the page by skipping the main menu.

Nissan sees 3rd annual net loss in FY 2021 of $551 mil.

(File photo/Mainichi)

TOKYO (Kyodo) -- Nissan Motor Co. on Tuesday forecast a net loss of 60 billion yen ($551 million) for fiscal 2021 through next March, the third straight year of red ink, as the struggling automaker factors in the negative impact of a global chip crunch and rising material costs.

    The negative outlook comes as Nissan currently expects a production cut of around 250,000 units for the year through next March due to the semiconductor shortage. It also reflects the automaker's stepped-up investment to keep pace with global peers in electrifying cars at a time when the momentum for decarbonization is building.

    For the business year ended March 31, Nissan reported a net loss of 448.70 billion yen due to slumping vehicle sales amid the coronavirus pandemic.

    The loss shrank from the 671.22 billion yen in fiscal 2019, but the Yokohama-based automaker still faces an urgent need to continue with its restructuring by departing from the past expansion strategy pursued by former boss Carlos Ghosn, who was ousted in 2018 following his arrest over alleged financial misconduct.

    "We are facing big risks to our business due to the global semiconductor shortage and rising raw material costs," Nissan CEO Makoto Uchida told a press briefing.

    Sales are expected to increase 15.7 percent to 9.1 trillion yen in the current business year, as the carmaker aims to boost global auto sales to 4.40 million vehicles from 4.05 million last fiscal year, the lowest since fiscal 2009.

    Nissan estimates the semiconductor shortage will curb production by around 500,000 units in fiscal 2021, mainly due to a fire at a plant operated by major auto chip supplier Renesas Electronics Corp.

    But Chief Operating Officer Ashwani Gupta told the briefing that about half of them will likely be recovered in the second half as Renesas is restoring production faster than expected.

    Fiscal 2020 was a difficult year for global automakers, with the COVID-19 pandemic denting demand sharply. The auto industry has also been grappling with the chip crunch since late last year, which has forced some carmakers to reduce production.

    Nissan reported an operating loss of 150.65 billion yen after sales dropped 20.4 percent to 7.86 trillion yen in the business year ended March 31.

    Despite the shortage of semiconductors, Nissan has projected sales growth in its key markets such as North America and China as well as its home market Japan.

    Uchida has made it clear that Nissan will not chase volume excessively. The automaker's four-year turnaround plan until fiscal 2023 aims to reduce both production and its car lineup by 20 percent and targets a 6 percent global market share at the end of fiscal 2023.

    Still, Uchida said Nissan will allocate the necessary funds to push for car electrification.

    "To attain the goal (of carbon neutrality by 2050), we are aiming for all new cars we introduce in key markets to be electrified from the early 2030s," Uchida said.

    "It's essential to keep up investment" to meet the needs of connected, automated, shared and electric vehicles, he added.

    In December, Nissan launched its new Note compact car equipped with e-Power hybrid technology. Meanwhile, its rival Honda Motor Co is aiming to have EVs and fuel cell vehicles account for all of its sales by 2040.

    Also in The Mainichi

    The Mainichi on social media

    Trending