Wednesday July 29, 11:22 AM
Honda, Nissan see flickers of recovery
By Daniel Rook
TOKYO (AFP) - Japanese automakers Honda and Nissan said Wednesday they saw glimmers of hope for the battered industry thanks to growing demand for fuel-efficient cars but warned the road to recovery would be bumpy.
The two automakers said conditions remained tough in the fiscal first quarter to June because of weak sales in key markets such as the United States, Japan and Europe.
Honda said its net profit dived 95.6 percent in the fiscal first quarter through June from a year earlier to 7.56 billion yen (80 million dollars). Revenue slid 30.2 percent to 2.0 trillion yen, weighed down by a stronger yen.
Despite the tough first quarter, Honda upgraded its outlook for the full year to March, forecasting a net profit of 55 billion yen, against an earlier goal of 40 billion yen.
"While we cannot say yet that the North American market has recovered, sales are picking up this past month," helped by government economic stimulus measures, said Honda vice president Koichi Kondo.
Nissan, which is axing 20,000 jobs to cope with the global economic crisis, logged a net loss of 16.53 billion yen (175 million dollars) for the fiscal first quarter to June, against a year-earlier profit of 52.80 billion yen.
It reiterated its forecast to end the full business year to March 170 billion yen in the red, after a 233.7 billion yen shortfall the previous year -- its first annual loss in almost a decade.
"2009 continues to be a tough year, but we are beginning to see positive results from the measures taken under our recovery plan," said Nissan chief executive Carlos Ghosn, who also heads Renault (Paris: FR0000131906 - news) .
Japanese automakers hve taken a heavy blow from the global economic downturn, which has caused sales to plunge.
Industry watchers said the outlook was brightening, but agreed that the road to recovery would be rocky.
"The Japanese auto industry is expected to pick up later this year thanks to government incentives, which are boosting sales of environmentally friendly cars, notably hybrids," said Okasan Securities auto analyst Yasuaki Iwamoto.
"But tough times still lie ahead. Automakers have to maintain their momentum after the impact of government incentives end."
The industry also faces unprecedented competition with electronics makers chasing a share of the growing market for batteries and electric motors, he said, adding: "A drastic change awaits the auto industry."
Honda is seeking to accelerate the launch of its hybrid vehicles to ride a wave of interest in fuel-efficient cars, helped by government tax incentives.
Earlier this year the company rolled out a revamped model of its flagship fuel-sipping Insight, which was the best-selling hybrid in April in Japan before being overtaken by rival Toyota's remodelled Prius.
Nissan, which was slower than rivals Toyota and Honda to embrace fuel-efficient petrol-electric hybrids, aims to take a lead in zero-emission cars and will unveil its first model to the public in Japan on August 2.
The cars, to be launched in the US and Japan next year, will "spearhead our vision for mass-market zero-emission mobility," Ghosn said.
In order to tap the strength of the Chinese market, Nissan said its joint venture partner there, Dongfeng Motor Co., would invest about 730 million dollars to build a new production line at a plant in Guangzhou City by 2012.
|
|
|
Send Article by Email
Send Article by IM
Blog This with Y! 360
Printable View
