Nissan Motor Company has lowered its operating profit forecast by 43%, influenced by a drop in car sales.
According to Reuters, the company’s new management is facing more pressure to reform a company still reeling from a scandal affecting its former leader, Carlos Ghosn.
The sharp decline in Nissan's earnings strength has already led to plans to cut jobs, close manufacturing sites and reduce the offered products, as the car maker is backing off a strong push by Ghosn to increase market share.
Reducing expectations comes after the carmaker incurred a net loss of 26.1 billion yen ($ 238 million) in the third quarter, which starts in October and ends in December, and comes in contrast to positive expectations from its competitors Toyota Motor and Honda Motor.
He became the second largest Japanese automaker to expect operating income at 85 billion yen ($ 775 million) for the fiscal year ending in March, well below the median forecast of 134.5 billion yen in a poll of analysts conducted by Refinitiv.
The corporate image was hit hard by years of severe cuts in the United States and other countries, and Nissan's global car sales tumbled 11 percent between October and December.
Sales fell 18 percent in the United States, as models that were once popular as the SUV Rouge and Sedan Sentra are not so popular. In China, sales fell 0.6 percent.
The company now expects to sell 5.05 million cars for the whole year, which will be its weakest sales performance since 2013.
Ghosn, who was also head of Renault's Nissan partner in the alliance, was arrested in Japan in November 2018 on charges of not disclosing his true salary and using company funds for personal purposes. Ghosn denies any wrongdoing and simulated a dramatic escape to Lebanon in December while he was awaiting trial.
