After switching out its U.S. management, Nissan is back
10. Carlos Ghosn and NissanFor a man unaccustomed to failure and never known for his humility, Nissan CEO Carlos Ghosn performed a graceful mea culpa in front of a roomful of journalists by conceding that his expectations for Leaf EV sales were wildly off the mark. Ghosn refused to assign blame, but, characteristically, he reaffirmed his faith in EVs and took steps to make sure he doesn't fall short again. In an effort to juice sales, he cut Leaf prices 18%, announced the addition of a stripper model at a lower price, and reaffirmed his determination to see electrified cars reach 10% of the market by 2020.
Japan’s Nissan Motor Co. is back with a bang in the U.S. market, as the efforts of a new management team start to show some results.
Nissan said Monday its sales in the U.S. grew 14% to 350,000 in the first quarter of its fiscal year ending March 2015, helping the company to a 122.6 billion yen ($1.20 billion) operating profit that was 12% above a consensus forecast compiled by Reuters. Higher unit sales and lower discounts in the U.S. were the key factors behind the result.
Global sales rose 6% to 1.24 million, lifted also by a 21% rise in sales in China. Having banked a successful first quarter, the company repeated its forecast that it will sell 5.65 million vehicles this fiscal year, up 8.9% from last year. New plants in Mexico and Brazil are due to start production in the course of the year.
The Japanese company, which has a long-term strategic partnership with France’s Renault SA, has said it wants to get back to a U.S. market share of 10%, compared to its current 8.6%. In January, it had installed Jose Munoz, a veteran of its European arm, as head of North American operations. Sales in the U.S. were up 13% on the year between January and June.
However, the Japanese company is also losing one of its management stars: Johan De Nysschen, who led the premium Infiniti brand to a 30% rise in sales in the first half of the calendar year, is soon to take over at General Motors Inc’s (GM) Cadillac brand.
“Nissan continued to make progress in the first three months of the fiscal year as encouraging demand for new products, benefits from recent plant investments, and improving market conditions in North America, China and Europe combined to lift both revenues and profits,” president and chief executive Carlos Ghosn said in a statement.
“Nissan is well placed to deliver on its outlook given our continued product offensive along with measures to enhance competitiveness, build market share and the ongoing benefits of our Alliance strategy.”
The company noted that sales of its LEAF electric cars have now topped 124,000, “making it the best selling electric vehicle in history”. The company has had to cut prices and abandon previous over-optimistic forecasts for sales, but still expects EVs to be 10% of total sales by 2020.
The company’s shares closed up 0.8%, outperforming the local Nikkei 225 benchmark.