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Nissan Profits More Than Double as Sales Hit Record

Overcoming “the headwinds.”

by on May.11, 2012

Nissan CEO Carlos Ghosn with the maker's new Altima sedan.

Nissan Motor Co., the Japanese automaker generally credited with staging the fastest recovery from last year’s earthquake and tsunami has underscored its rapid turnaround by reporting record sales for the 2011 fiscal year.

The maker reached an all-time record selling 4.8 million vehicles in 2011, with profits for the fiscal year that ended March 31 gaining 7%, to 341.1 billion yen.  But the big jump occurred during the final quarter of the 2011 fiscal year, Nissan profits more than doubling, to 75.3 billion yen, or $943 million, up from 30.8 billion yen a year ago.

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With production back to full speed after the disaster-led cuts of last year, Nissan is nothing but optimistic about the future, the maker forecasting further earnings gains on worldwide sales it expects to reach yet another record of 5.3 million for the 2012 fiscal year, which began on April 1. And it is predicting a 28% increase in earnings.

“As we start the new year, Nissan stands as a company re-tooled and ready to accelerate its growth,” said Carlos Ghosn, who serves as CEO of both Nissan and its global alliance partner Renault.

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May New Car Sales Off to “Dismal” Start

Shortage of Japanese products part of the problem.

by on May.20, 2011

Sales have taken a tumble at dealerships around the U.S. in recent weeks.

After months of steady growth, the U.S. new car market appears to be taking a nosedive in May, according to observers tracking traffic at the country’s dealer showrooms.

The “dismal” start appears to be the result of a variety of factors, according to a preliminary reports by J.D. Power and Associates, including a sharp cutback in rebates and other incentives.  But many potential buyers also appear to be holding back because of a worsening shortage of Japanese vehicles.

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The industry picture isn’t entirely gloomy, however. Demand for used cars is skyrocketing, with price increases hitting never-before-seen levels, as TheDetroitBureau.com reports.  (Click Here for that story.)

The soaring cost of fuel is another factor impacting the new car market, according to Jeff Schuster, executive director of global forecasting at J.D. Power and Associates. “As a result, the industry will likely be dealing with a lower sales pace at least through the summer selling season, putting pressure on the 2011 outlook.”

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Japanese Production Bouncing Back – But Automakers, Suppliers Ready to Abandon Quake-Prone Nation

“Frantic” efforts and “war rooms” helping suppliers get back to business.

by on May.12, 2011

The March 11 quake -- and the strong yen -- could lead Toyota and others to increasingly shift more of their production out of Japan.

It won’t be a good year for Japanese automakers large or small.  The disaster that shook the island nation two months ago all but shut the industry down for a month and makers will be operating at a fraction of normal levels for some time due to shortages of parts ranging from plastic panels to microchips.

But a massive, behind-the-scenes effort could end the crisis a bit sooner than expected – though it leaves many observers wondering just how much Japan’s home auto industry will be hollowed out in the process.

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Even as manufacturing slowly creeps back to normal, industry officials are warning that they may shift more of their operations – both automotive assembly and parts production – out of quake-prone Japan.

“How much longer should we insist on producing in Japan?” asked Chief Financial Officer Satoshi Ozawa, as the maker announced a 77% plunge in its profits on Wednesday.

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Japanese Makers At Risk if Shortages Linger

Inventories could plunge by half.

by on Apr.05, 2011

Will normally loyal import buyers switch if faced with serious shortages of products like the new Honda Civic?

The ongoing crisis in Japanese automotive manufacturing could be the biggest setback brands like Toyota, Honda and Nissan have faced in decades should anticipated product shortages send buyers scurrying to check out competing products.

Dealers could struggle with barely half their normal inventory of Japanese cars, trucks and crossover in the coming months, warns the nation’s largest automotive retailer – while analysts say that rising prices could be an equally influential factor leading to mass defections by normally loyal import buyers.

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Nearly a month after Japan was rocked by a 9.0-magnitude earthquake and subsequent tsunami, a large portion of the island nation’s automotive assembly plants remain out of action or are operating at significantly reduced production schedules.  Though only a few assembly lines were damaged by the disaster, scores of automotive parts plants were impacted.  And compounding the situation, Japan continues to struggle with rolling blackouts in the wake of the crisis at the Fukushima Daiichi nuclear plant touched off by the quake and tsunami.

“Everybody’s in crisis mode,” said Michael Jackson, CEO of AutoNation, the Florida-based retailer that operated 243 dealerships in 15 states.

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Fall-out from Japanese Auto Shutdown Spreading

“Not a matter of if, but when” all automakers worldwide will be impacted, warns analyst.

by on Mar.21, 2011

Buyers are paying an extra $1,800 for the Toyota Prius, one analyst reports.

It’s only a matter of time until the global auto industry feels the full shock of the Japanese auto industry shutdown, according to a new study.  But the impact is already spreading, General Motors cutting production at a second U.S. plant due to a shortage of Japanese-made parts, while Honda tells U.S. dealers it may not be able to fill their orders due to production delays.

There are already signs that prices are going up on Japanese-badged vehicles, and some of the most high-demand models, such as the Toyota Prius, could be impacted most severely should the situation continue for more than a few weeks, analysts and industry insiders warn.

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Meanwhile, in their struggle to re-start home market production, some makers may turn to foreign sources for traditionally Japanese-made parts.  Nissan, in particular, is considering the need to ship engines produced in Tennessee back to Japan for use on some of its assembly lines.

“It is not a matter of if, but when,” warned Michael Robinet, chief of auto research IHS Global Insight, before the near-complete shutdown of the Japanese auto industry is felt by every major automaker worldwide.

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Would You Wait for a Japanese Car?

Toyota, other makers could be hurt if production delays lead to product shortages.

by on Mar.16, 2011

Honda buyers are among the most likely to wait out a product shortage, says CNW research.

How much do you really want that new sedan?  Would you sit tight for that sports car?  Will you wait several months for that big SUV?

Japan’s continuing crisis has already resulted in the loss of tens of thousands of new cars, trucks and crossovers, whether damaged by Friday’s massive earthquake, the subsequent tsunami, or simply through lost production, most Japanese automakers unsure when they’ll be able to get their assembly operations back up-and-running.

Even in the U.S., the natural disaster’s effects are being felt, Subaru halting production at its Indiana plant, while Toyota cuts all overtime.  And, now, even some Detroit makers could feel the pinch if shortages of Japanese-made parts begin to develop. (Find out more…Click Here.)

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“The impact of this has yet to unfold,” Mark Reuss, president of General Motors’ North American operations cautioned today, stressing that the quake’s impact on the Japanese supplier network could be “bigger than anyone knows today.”

One test will come if consumers begin to experience product shortages at the dealer level.  American buyers have traditionally preferred to buy whatever they can find on a dealer lot, rather than placing a custom order that might take weeks, even months, to come through.

So, will buyers who can’t find what they want go somewhere else?

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Japanese Car Production Up for First Time in 3 Years – But Not For Long

But Nissan, others shifting production to the U.S.

by on Feb.01, 2011

Nissan will shift Rogue production to the U.S.

Japanese car production rose 21.3% last year, the first increase in three years – though the trend is almost certainly downward, as makers like Nissan prepare to shift more manufacturing out of the home market.

Passenger car output jumped to 8.3 million in 2010, the first upturn since 2007, while truck production rose 22.8%, to 1.2 million, the first move upward in seven years, according to the Japan Automobile Manufacturers Association.

The increases reflected a rise in motor vehicle exports, which jumped 33.8%.  That was the first positive move in two years, JAMA announced.

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The increases all came as good news for a Japanese economy that has struggled through more than a decade of stagnation.  But there are strong indications things won’t last.  On the local front, the Japanese government has wrapped up its green car incentive program, which helped spur strong demand for models like the Toyota Prius – the top-selling automobile in Japan in 2010 – and the Honda Insight.

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First Drive: 2010 Lexus GX460

Solid, dependable, loaded with technology, but still a bit bland.

by on Nov.23, 2009

The 2010 Lexus GX460 officially goes on sale next month.

The 2010 Lexus GX460 officially goes on sale next month, with a base price of $51,970.

To listen to some folks in the mainstream media, the sport-utility vehicle is dead and gone.  Don’t try to tell that to American motorists.  Sure, sales are down, and many buyers are switching from conventional SUVs to lighter, more nimble and efficient crossover vehicles, but to misappropriate Mark Twain, reports of the sport ute’s demise are greatly exaggerated.

Just ask Toyota, which has blanketed the market with an array of conventional sport-utility vehicles and crossover-utes though both its mass brand, as well as up-market Lexus.  The latter marque’s RX line dominates the mid-luxury crossover segment, the big RX570 targets buyers looking for the ultimate combination of off-roadability and create comforts.

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Smack in the middle is the GX, a three-row, body-on-frame ute which is making its second-generation debut.  At first glance, it might be a bit confusing, the new 2010 Lexus GX460 replacing the older GX470.  In fact, while the displacement is down, Lexus has found a way to squeeze out more power, torque – and fuel economy.

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Japan Government Pushing Automakers to Shift to Eco-Vehicles

Makers being pressed for 25% cut in CO2, better mileage.

by on Nov.13, 2009

More vehicles like the Nissan Leaf battery car would be needed to meet Japanese government demands for new eco-cars.

More vehicles like the Nissan Leaf battery car would be needed to meet Japanese government demands for new eco-cars.

The new Japanese government is placing some serious pressure on the Japan’s auto industry by promising to cut CO2 emissions by 25 percent by 2020 from the levels that prevailed in 1990. The targets laid down by Japan’s new prime minister, Yukio Hatoyama, go well beyond anything contemplated by the previous government, according to Japanese experts on energy and environmental policy.

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Hatoyama’s goal will certainly require the broader use of eco-friendly cars such as hybrids, plug-in hybrids and electric vehicles, said Shin Hosaka, director of the automobile manufacturing industry bureau in the Ministry of Economy, Trade and Industry or METI, the successor to the Ministry international Trade and Industry, which helped orchestra the Japanese economic miracle in the years following World War II.

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Toyota Stealing From Big Three Playbook

With sales in freefall, Japanese maker offering Detroit-style sales incentives.

by on May.07, 2009

Storm clouds on the horizon. With even the new Prius off to a slow start, Toyota is rolling out Detroit-style rebates, subsidized leases and other incentives.

Storm clouds on the horizon. With even the new Prius off to a slow start, Toyota is rolling out Detroit-style rebates, subsidized leases and other incentives.

It used to be a point of pride for Japanese makers, Toyota in particular.  In fact, senior Asian executives could barely contain their glee at watching their Big Three Detroit rivals run up billions of dollars in costs on the rebates and other incentives needed to keep the metal moving.  Japan, Inc., on the other hand, happily collected a premium over sticker, especially on its most popular models, like the Toyota Prius hybrid.

Or so went the story line.  The reality was never quite so neat.  The Japanese have long had incentives, especially the smaller, weaker makes.  But the big brands generally kept that news quiet.  As Toyota’s Senior Vice President Don Esmond would acknowledge, “We have to remain competitive,” even if that meant just offering some cash that dealers could kick in to clinch a deal.

No longer.  The current economic downturn has been surprisingly democratic.  With sales currently running at just little more than half the peak levels of early in the decade, there isn’t a brand that hasn’t felt the pinch. Even Subaru and Hyundai, which initially seemed to defy the downturn, were off last month.

And then there’s Toyota.  After defying gravity, seemingly for decades, it has suddenly come crashing back down.  Its sales tumbled 41.1% in April.  While it’s clear that the traditional spring buying season hasn’t shaken off the hoary frost of winter, Toyota’s numbers were down much more than the overall industry’s 34.4% drop for the month.  In fact, Toyota saw a steeper dip than almost anyone other than Mitsubishi, down 55%, and bankrupt Chrysler, off 48%.

Subscribe to TheDetroitBureau.comToyota’s downturn could be seen across the board, with big drops by perennial Top 10 favorites like the Camry and Corolla, as well as the poster child for the environmental movement, the Prius. 

Indeed, the hybrid’s numbers, so far this year, have been running barely a third of where they were during the mid-2008 fuel price run-up, despite the launch of an all-new version of the Prius.

Intent on heading off the steady slide, Toyota has been taking a variety of steps, including unprecedented production cuts, notably at its U.S. operations.  Now, it’s beefing up the rebates and incentives it used to sneer at – and it’s no longer hiding that fact.

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