Nissan Motor shares fell 12% on Friday after cutting China sales expectations due to fierce competition, the worst drop in over two decades.
Fast-growing Chinese firms like BYD are producing inexpensive electric vehicles for younger Chinese drivers, causing Western competitors to lose market share in the world’s largest auto industry. Nissan has more at stake—China was its largest market until 2022. The arrest and demise of former Chairman Carlos Ghosn also hampered its recovery.
James Hong, Macquarie’s mobility research director, said Nissan is “most susceptible” in China compared to Toyota and Honda.He claimed they’re most stressed. As they compete for market dominance, Chinese firms are becoming more aggressive.”
Nissan’s market value fell 11.6% Friday, losing $1.8 billion.
Analysts projected 141.6 billion yen ($948 million) in third-quarter operating profit; the corporation decreased its prediction by 150,000 automobiles to 3.55 million.Since Nissan’s China sales fell by a quarter in the nine months to December, CFO Stephen Ma cut the sales projection. The corporation also cited increased competition in major countries including the US.
The company’s competitiveness plan includes incentive adjustments, he added.
