TOKYO, JAPAN – Nissan said on Wednesday that its net profit more than doubled in the three months to June, as a weaker yen and improving sales in Japan and North America offset declines in China.
The news came as the Japanese giant said it had agreed to invest hundreds of millions of euros in the new electric vehicle venture of France’s Renault as part of a reboot of their long-running alliance.
Nissan said it saw a net profit of 105.5 billion yen ($750 million) in the fiscal first quarter, a year on year rise of 124 percent.
Sales rose 37 percent to US$20.6 billion (2.9 trillion yen), even as tougher competition and a sluggish post-Covid recovery hurt its performance in China, it added.
“In the first quarter, we were able to compensate for the sluggishness in the Chinese market by our performance in other regions, resulting in a significant year-on-year improvement,” Nissan president and chief executive Makoto Uchida said.
“The recovery in production and sales in Japan and North America was of particularly note, and we aim to maintain this momentum in the second quarter and beyond.”
The auto giant also raised its annual net profit forecast to US$2.4 billion (340 billion yen) from its previous estimate of US$2.2 billion (315 billion yen), boosted in part by cost-cutting.
But it expects the full-year sales volume to drop 7.5 percent from its previous forecast to 3.7 million units as a result of falling sales in China.
Nissan has lurched from crisis to crisis in recent years as it was hit by the arrest of former boss Carlos Ghosn, pandemic lockdowns and Russia’s Ukraine invasion.
Its full-year results were in the red in 2020 and 2021.
But more recently it has been helped by a weaker yen, which inflates profits for exporters, and the firm moved back into profit in 2022 and this year.
Concerns about its leadership flared anew in June when the carmaker announced a surprise departure of top executive Ashwani Gupta.
Gupta was part of an executive troika announced in October 2019, as the company struggled to regain its footing following the arrest of Ghosn.
Nissan has also had to weather rocky relations with its French alliance partner Renault.
Earlier this year, they signed a deal to reboot their troubled 24-year relationship, following months of painstaking negotiations and repeated delays, with Renault slashing its stake in Nissan.
As part of the agreement, Nissan was to take a stake of up to 15 percent in Renault’s new electric vehicle venture Ampere. But the size of the investment was not specified at the time.
Nissan said Wednesday it had agreed to invest up to 600 million euros ($664 million) in Ampere — less than expected — securing the Japanese company a board seat.
“The speed of customer needs is different in each market, and Ampere is an advantage for us in the context of Europe. It will also strengthen our electrification strategy,” said Uchida.