The Strategist

Nissan claims a threat of net loss for the first time since 2009

04/29/2020 - 03:04

Japanese automaker Nissan Motor Co. may record a net loss for the past financial year for the first time in 11 years against the backdrop of the negative impact of the coronavirus pandemic, the company’s press release said.

Rian Castillo via flickr
Rian Castillo via flickr
The company revised its forecast, released in February. The company expected to generate small profits based on the results of the financial year ended March 31, 2020. Now a net loss of 85-95 billion yen ($ 792-885 million) is expected.

This will be Nissan's first annual loss since the fiscal year ended in March 2009, The Wall Street Journal notes. Then the global financial crisis that began in 2008 affected the company's performance.

Nissan's forecast outlook is explained by a slowdown in car sales, an increase in reserves to cover potential losses, and a decrease in profit of subsidiaries.

The company planned to publish annual results and a new medium-term business plan in mid-May, but on Tuesday shifted the publication date to May 28.

Even before the onset of the crisis caused by the spread of coronavirus, Nissan faced a drop in sales in the US and other key markets.

Nissan's global sales in March fell 43% year on year, according to a separate press release. Sales in the US market, which is usually the most profitable for the company, fell by 48%.