Nissan Motor Co. had a pretty good fiscal 2023.
The Japanese automaker recorded a net profit of 426.6 billion yen ($2.7 billion) for the fiscal year that ended in March, marking a 92% increase. Annual sales climbed almost 20% to 12.7 trillion yen ($81.5 billion).
That’s despite a 5.2% decline in profits to 101.3 billion yen ($651.3 million) for the three-month period that ended in March. Analysts had expected 70.69 billion yen ($454 billion), according to FactSet, a data provider.
Sales grew in all but one major market — China, where Nissan has struggled to match local rivals. Retail sales in China fell by 24% to 794,000 units in Nissan’s fiscal year 2023, while production dropped 26%. That includes the past two quarters, when Nissan saw positive year-over-year growth.
The world’s largest auto market is an attractive market for carmakers, although most traditional foreign companies have had a difficult time capturing a significant amount of consumer interest. In the electric vehicle segment alone, foreign companies are competing with 123 domestic manufacturers.
“The market situation in China is highly competitive, with a somewhat frenzied price war,” Nissan CFO Stephan Ma told analysts earlier this year. “Rather than entering fiercely contested markets, we shifted our focus to the [internal combustion engine] market.”
The automaker said Thursday that the Sylphy compact remained the market-leader in China’s ICE passenger segment.
Nissan on Thursday said it will focus on developing new vehicles tailored to the market and introduce a series of new-energy vehicles under “The Arc” business plan. The company aims to launch 30 new models — 16 of which will be electric — and refresh 60% of its gas-powered vehicles by fiscal year 2026, or sometime around May 2027. The Yokohama-based carmaker aims to boost total car sales by 1 million units within three years, largely driven by the new electric offerings.
Plus, Nissan plans to invest more than $2.6 billion in battery capacity to reduce the cost of its next-generation EVs. In March, Nissan said it would explore a strategic partnership with fellow Japanese automaker Honda $HMC Motor to create “core components” related to EVs.
For the new fiscal year, which began on April 1, Nissan projects global sales to climb 7.5% to 3.7 million units and revenue to increase 7.2%. However, it predicts to record 380 billion yen ($2.4 billion) in profit through March 2025, down 11% year-over-year, because of high development costs. Global sales are expected to hit 3.7 million units.