According to a British Reuters report, Nissan Motor Company announced in Thursday, two quarterly operating profit fell 29% Year-on-year, mainly by the U.S. market downturn hit, sales are weak.
The region accounts for 25% of its global sales, and the drop in sales in the US has a direct impact on sales in North America, leading to a general decline in global market sales. Nissan's two-quarter profit was 109.1 billion yen ($ 986 million), slightly above the 103.4 billion yen estimated by Reuters analysts.
In North America, Nissan's biggest market, which has been affected by a 9.5% decline in US car sales, has fallen 2.6% to 49.5 billion yen (about 445 million dollars). Nissan has offered substantial discounts on its best-selling models, including Rogue, in an effort to boost sales in North America, and profits have continued to fall.
At the same time, with the North American market consumers of SUVs and pickups, Nissan's main car Altima demand for less, its sales have been depressed, it is not conducive to corporate profits. After years of focusing on gaining market share in the region, Nissan is boosting profits by cutting incentives. The carmaker noted that the change would put pressure on sales in the region, especially in the first half of the year.
The company predicts that sales in North America will fall by 2.9% in fiscal year 2018, in the hope of reducing the cost of incentives and eventually boosting profitability. Nissan's sales in China grew 6.9% in the two quarter, while in Japan, sales fell slightly by 0.8%.
Overall, global sales fell by 3% to 1.31 million vehicles. Nissan, like other Japanese carmakers, is also preparing for a possible rise in U.S. car import tariffs, which could increase the cost of doing business in the US.