Automotive News

CEO Ivan Espinosa put Nissan on recovery path, after massive cost control, plant closures and job cuts. Big question is whether he can now deliver sales growth. Read more in Automotive News . YOKOHAMA, Japan – Embattled Nissan Motor Co. has finally shifted into growth mode, posting profits and forecasting sales increases as CEO Ivan Espinosa‘s turnaround gains traction after years of sliding sales, despite headwinds from tariffs and war in the Middle East. Nissan forecasts global deliveries to expand 4.7 percent to 3.3 million vehicles in the current fiscal year ending March 31, 2027, after contracting in seven of the last eight years. Operating profit will more than triple to ¥200 billion ($1.3 billion), and the carmaker expects to post net income of ¥20 billion ($125.3 million), as it bounces back to the black, Espinosa said May 13 while announcing financial results for the fiscal year ended March 31. Meanwhile, the company has stanched its cash burn and is poised to wrap its plant closures. “We have now moved into a growth phase,” Espinosa said at the Japanese carmaker’s global headquarters here south of Tokyo. “We are ahead of plan, and the progress is visible.” Espinosa credited the upswing to massive restructuring, a stream of new product and a laser focus on better quality retail sales in key markets such as the United States. The company forecast North American deliveries to grow 2.2 percent to 1.32 million vehicles in the current fiscal year.Sales in the region declined 0.9 percent to 1.29 million in the just-ended fiscal year. Espinosa’s bullish assessment comes despite lingering pain from U.S. tariffs and new pressures from the war in Iran. But the company, which has booked net losses for four of the past seven fiscal years, is building momentum thanks to a tough-love, three-year recovery plan. Rekindling sales growth is key to securing top-line revenue as a counterpoint to the massive cutbacks to rebalance Nissan’s cost structure and balance sheet. Under Espinosa’s Re:Nissan revival plan, Nissan is slashing ¥500 billion ($3.1 billion) in costs, closing seven of 17 global factories, cutting 20,000 jobs and reducing production capacity to an estimated 2.5 million to 3 million vehicles in the fiscal year ending March 31, 2028. The 47-year-old Mexican, who took office a year ago as the company’s youngest CEO, said the company is ahead of schedule in several tasks, including cutting fixed costs and jobs. Espinosa’s assessment came as Nissan reported a 17 percent drop in operating profit to ¥58 billion yen ($363.3 million) in the fiscal year ended March 31. Despite the decline, the company’s operations recovered after chalking a first-half operating loss. Tariffs lopped off ¥286 billion ($1.8 billion), while inflation dented results by ¥95 billion ($595 million). Cost control of ¥227 billion ($1.4 billion) nudged Nissan up. Nissan’s global retail sales declined 5.8 percent to 3.15 million vehicles in the just-ended fiscal year.

When embattled Honda CEO Toshihiro Mibe announces a new business plan on May 14, amid record losses for the Japanese carmaker, one question will be how many more cutbacks will there be. Read what to expect in my report here in Automotive News. TOKYO — Honda’s automotive strategy is unraveling worldwide as CEO Toshihiro Mibe tears up his old plan and draws up a new one in the face of the company’s first-ever full-year loss. Honda Motor Co.’s recent retreats on several fronts will be in the spotlight May 14, when Mibe announces a new road map focused on hybrid vehicles instead of full electrics while delivering financial results drowning in red ink for the full fiscal year ended March 31. Japan’s No. 2 carmaker has accelerated course corrections since warning of losses in March. Honda killed off most of its next-generation electric vehicles, including those planned for the Afeela brand under its joint venture with Sony. It then extended the U.S. life cycles of internal combustion engine mainstays, such as the Accord and HR-V, to save money and prop up profits. The carmaker said it will pull out of the South Korean market. It will also reportedly shutter an assembly plant in China and indefinitely freeze plans for a mammoth EV-making hub in Canada. Honda is also expected to delay its autonomous vehicle driving timeline. Adding insult to injury, Honda has vacated its self-owned landmark headquarters in Tokyo to move into a new mixed-use skyscraper with only partial rights to some office floors. And its Formula 1 partnership to supply engines to Aston Martin has been a boondoggle this season, with power plant problems relegating the team to the bottom of the constructors’ standings. Mibe is expected to tackle these issues and more with a new game plan this week. Honda warned in March that it will book an operating loss between ¥270 billion and ¥570 billion ($1.7 billion to $3.6 billion) for the fiscal year ended March 31. Honda also forecasts a net loss of between ¥420 billion and ¥690 billion ($2.6 billion and $4.3 billion) in the fiscal year. The full-year operating loss will be Honda’s first since the company went public in 1957. Japan’s Nikkei newspaper reported May 8 that the red ink would come in at ¥400 billion ($2.5 billion) Honda already announced a decline in global sales. Deliveries fell 7.4 percent to 3.4 million vehicles in the just-ended fiscal year, contracting for a second year to their lowest level since 2012. Honda’s headaches stem in large part from Mibe’s optimism on EVs. After taking the helm in 2021, he embarked on a radical makeover. He pledged to turn one of the world’s top makers of internal combustion engines into a company completely combustion-free in 2040. But Mibe was forced to rethink his strategy amid sudden changes in U.S. regulations and incentive programs, as well as new U.S. tariffs and a global slowdown in EV demand growth.