Nissan's ready to roar into fast lane

Profits at car group Nissan have roared ahead by 18% for the half year to the end of September - though the company said this was largely due to one-off boosts.

Profits at car group Nissan have roared ahead by 18% for the half year to the end of September - though the company said this was largely due to one-off boosts.

The Japanese company, which employs 4,500 in its Sunderland plant, yesterday posted global profits of £1.2bn, up from £1.03bn last time.

But despite leaving the likes of the ailing Ford and Vauxhall in its wake, Nissan was quick to point out its performance had been helped by revenue from the sale of shares in Nissan Diesel Motor Co, pension benefits from China and tax benefits from restructuring a dealer network.

Ford has just reported its largest quarterly loss in 14 years - £3.1bn for June to September.

And on Wednesday, General Motors reported another loss, though the modest £61m after-tax figure for the third quarter of 2006 was a huge improvement on a year previously, when it lost £900m.

Total revenues at Nissan, after tax, reached £20.8bn, which was up 1% on a year earlier. And while operating profit fell by a substantial 15.3% to £1.56bn, the company said performance would pick up in the second half, thanks to several scheduled product launches. During the next six months, nine new products will be introduced globally, including the Sunderland-built Qashqai.

Nissan president and chief executive Carlos Ghosn said: "As forecast, a combination of external headwinds and a lack of new product resulted in a lower level of performance in the first six months.

"In the second half, and into 2007, you will see a return to the intense product launch activity that has fuelled Nissan's profitable growth in the past".

Nissan has now abandoned the possibility of another "alliance" with General Motors, and appears well set for the next six months.

Mr Ghosn said that with the success of Nissan's "Value-Up" plan and favourable foreign exchange rates, the company should hit its original forecasts for the full fiscal year, despite issues such as high commodity prices, energy prices and interest rates.

Professor Garel Rhys, director of the Centre for Automotive Research at Cardiff Business School, said: "Nissan has unleashed the talent of its younger stylists.

"There was never anything much wrong with its production side - just a need for good products - and they have that now."

Industry analyst Mark Bursa said: "A lot of the old problems with Nissan were with bad management, but Ghosn stripped that out, leaving the fundamentally good Nissan business.

"There was a general dullness about Nissan until Ghosn came in, but now they are making some very, very interesting looking vehicles."

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