Nissan shares fell 6% on the stock market after dismal results
Tokyo (EFE) – Shares of Japanese car manufacturer Nissan Motor hit mid-session on the Tokyo Stock Exchange, falling 6.26% this Friday, after announcing the day before that it would lay off 9,000 workers worldwide and cut its global production due to… for a drop in its profitability.
Nissan Motor shares were bought at 384.3 yen (2.33 euros) before the midday break after falling to 368.5 yen (2.23 euros) earlier in the day, representing a fall of 10% and the lowest price since October 2020 year. , in the midst of the coronavirus pandemic.
This is how investors reacted to the restructuring measures announced the day before at Japan’s second-largest automaker, as well as to poor financial results.
Nissan results
Nissan’s net profit fell in the April-September period to 19.223 million yen (€116 million/$125.1 million), the company said, mainly due to lower sales and production adapting to weaker demand.
In the above-mentioned period, the first half of the Japanese fiscal year, Nissan’s operating profit fell 90.2% to 32.908 million yen (198 million euros) and sales turnover fell 1.3% to 5.9 trillion yen (35.607 million euro). .
The Japanese manufacturer placed 809,000 vehicles during the semester, representing a decline of 2.8%. In North America, its main market, sales fell 0.2%, while in China, its second-largest market, they fell 12.5%.
Layoffs and production cuts
Company President and CEO Makoto Uchida announced at a news conference Thursday that the company will lay off 9,000 of its roughly 130,000 employees worldwide and cut global production by 20% “to become stronger, more resilient and fit for the future.”
Uchida did not provide details on which countries or when exactly these workforce reductions would occur, and said production levels in each region where it operates would be “reviewed and discussed.”
Nissan has auto parts factories in Avila and Cantabria (Spain). In Latin America, Nissan Motor has three vehicle production plants in Mexico, one in Brazil and another in Argentina, the latter shared with its partner Renault.
The company will sell part of its stake in Mitsubishi Motors.
The company will also sell 10% of its stake in partner Mitsubishi Motors, in which it previously held 34.01%, as part of a cross-ownership scheme in a three-way alliance that includes France’s Renault in addition to the two Japanese firms.
The CEO and President mentioned that the company’s poor performance was due to “an increasingly tough market with more competitors,” rising raw material prices, semiconductor shortages, or the company’s “excessively high” sales target.” due to the deterioration of Nissan’s financial condition.
Nissan’s share of the global market for hybrid electric vehicles – one of the most popular models today – is smaller than that of its main Japanese competitors, Toyota and Honda.
The company also faces increasingly aggressive local competition in the Chinese market, according to analysts, who also point to the burden that accumulating a growing inventory of unsold vehicles poses to the company.