Nissan India profit slumps 50% on sinking domestic sales, drop in exports

Published: March 1, 2019 3:55 AM

Since its India foray in 2005, Nissan has been struggling to garner substantial volumes, as a result of which its market share remained at around a minimal 2%.

Revenue from operations during FY18 (April-March) fell 21.67% y-o-y to Rs 7,437.3 crore against Rs 9,495.4 crore in the year ago fiscal, data sourced from the corporate affairs ministry showed.

By Pritish Raj

Nissan Motor India, the local arm of the Japanese carmaker, reported a 49.30% year-on-year (y-o-y) decline in net profit at Rs 61.9 crore for the fiscal ended March 2018, on account of sinking domestic sales and drop in exports owing to few model launches and poor product recognition. Net profit in the previous fiscal stood at Rs 122.1 crore.

Revenue from operations during FY18 (April-March) fell 21.67% y-o-y to Rs 7,437.3 crore against Rs 9,495.4 crore in the year ago fiscal, data sourced from the corporate affairs ministry showed.

At the end of FY18, exports dropped 38% y-o-y to 67,829 units compared to 109,459 units it shipped from India in FY17. The company lost the status of the second largest exporter of passenger vehicles from India in 2014-15 and it further went down to sixth spot in FY18.

In the domestic market, the maker of sedan Sunny and hatchback Micra ranked at the ninth position out of the 14 carmakers in India. In line with weak sales, production slumped 27.51% to 122,653 units during the last fiscal.

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Since its India foray in 2005, Nissan has been struggling to garner substantial volumes, as a result of which its market share remained at around a minimal 2%. In FY18, the company’s market share in the domestic passenger vehicle (PV) segment fell to 1.61% compared to 1.88% in FY17, as per data from the Society of Indian Automobile Manufacturers (Siam).

Of around 33 lakh PVs sold in the last fiscal, Nissan Motor India could only sell 52,796 units, including those from its Datsun brand, a drop of 7.86% over the previous fiscal. Separately, while Datsun brand sales were 40,387 units, Nissan-brand car sales stood at 12,409 units.

Nissan Motor India did not respond to an e-mail sent for this story. Experts believe limited success of products and fewer models in the line-up have been the main concern for the Japanese automaker. The company’s sedan Sunny initially received a good response when it was launched in 2011 but gradually sales started dwindling owing to design wearniess and stiff competition from the Honda City, Hyundai Verna and Maruti Ciaz, pulling down the sales number to just 39 units in December 2018.

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Nissan’s hatchback Micra also could not cheer customers due to its ageing product design, poor mileage and safety features. Sales of the Micra currently account for less than 100 units. Its compact SUV Terrano has also been facing difficulties in garnering volumes within the domestic market and has been discontinued. Last month the company sold just 16 units.
However, Nissan’s latest launch — the Kicks compact SUV — has managed to clock 1,370 units in January 2019 and analysts believe this new product can turn around the fortunes of the company.

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