Nissan's sales jump in October was due, in part to continuing strong results of the Versa.
Nissan’s operating profit was up 22.4% during its second quarter due to strong sales in the U.S. as well as a weak yen. However, the maker cut its global sales forecast by 3.5% for the year due to weaker than expected sales in China and softness in Japan.
Nissan plans to sell 5.45 million vehicles worldwide during its financial year, which ends March 2015.
Japan’s No. 2 automaker reported an operating profit of 139.34 billion yet ($1.2 billion), which beat analysts’ estimates. The big driver was strong sales in the U.S., which were up 13.7% during the quarter. Like most of the automakers in America, Nissan benefitted from low gas prices and a slowly recovering economy.
However, the company also put a fair amount of cash on the hoods of its vehicles as a further enticement to lure buyers into its dealerships. The factors have combined to give Nissan an optimistic outlook on its North American sales for the rest of the year; it raised its sales outlook to 1.81 million units, which is a 3% boost from its previous prediction.
Strong sales of the Rogue sport-utility vehicle and the Altima sedan led the way during the quarter in the U.S. However, October also saw sales of the Sentra (56%), Versa (28%) and Murano (37%) increase significantly.
(Big interest in autonomous vehicles in Asia. For more, Click Here.)
The rosy outlook doesn’t extend to Asia though. In Japan, a sales tax increase is acting like a wet blanket on consumer spending, which is hurting car sales. Additionally, its sales in China are down 12% during the most recent quarter.
Nissan’s venture with Dongfeng Motor Group Co Ltd has been hamstrung by anti-pollution regulations and slowing economic growth that have put a drag on the sales of passenger cars and commercial vehicles.
(Click Here for details about BMW’s 3Q earnings.)
As a result, Nissan revised its expectations for China downward for the year to 1.27 million vehicles from 1.43 million, an 11% drop.
(To see more about strong U.S. auto sales in October, Click Here.)
“In China, the general weakness in the LCV (light commercial vehicle) segment and increased competition in the compact car segment, as well as the persisting negative impact from political tensions on Japanese brands, hurt sales,” said Nissan Chief Competitive Officer Hiroto Saikawa, Reuters reported.
In October, Toyota’s sales in China were higher than Nissan’s – 104,700 to 104,000. It marked the third consecutive month of increases for Toyota and a fourth straight month of declines for Nissan.