Nissan returns to profit, Mitsubishi reduces loss

[July 29, 2010]  TOKYO (AP) -- Nissan Motor Co. veered back into the black in its latest quarter as global car sales rebounded while its smaller rival Mitsubishi Motors Corp. narrowed its quarterly loss.

Yokohama-based Nissan, maker of the Leaf electric vehicle and the March compact, said Thursday its profit was 106.6 billion yen ($1.2 billion) for the April-June quarter, the first of its fiscal year. It lost 16.5 billion yen the same period the previous year.

Quarterly sales surged 35.3 percent to 2.050 trillion yen ($23.6 billion).

"First quarter results for Nissan are good, and our recovery is vigorous and ahead of schedule," said Nissan Chief Executive Carlos Ghosn, who also serves as chief executive of alliance partner Renault SA of France.

Other Japanese automakers are also expected to report rosier results as global sales recover, especially in new markets such as China and India.

Strong China sales helped Mitsubishi narrow its loss for the April-June quarter to 11.8 billion yen ($135.6 million).

Japan's fifth-biggest automaker, which makes the iMiEV electric car, had posted a 26.4 billion yen ($303.4 million) loss for the same period a year earlier amid a strong yen, which erodes overseas profits, and an economic slump.

Quarterly sales totaled 403.7 billion yen ($4.6 billion), marking a 56 percent increase from the previous year.

But Nissan's Ghosn said challenges remained because of uncertainty about the recovery, soaring materials costs and volatile exchange rates, although demand for Nissan's cars remained strong.

Nissan, neck and neck with Honda Motor Co. for the status of Japan's No. 2 automaker after Toyota Motor Corp., sold 954,000 vehicles during the quarter around the world, up 32 percent from the same period in fiscal 2009.

Tokyo-based Mitsubishi sold 257,000 vehicles during the quarter, up 21 percent from the previous year. Sales improved in Japan, with demand healthy for the Colt compact and Outlander sport utility vehicle. Sales were also strong in the rest of Asia, including China and Thailand.

Mitsubishi stuck to its forecast for a net profit of 15 billion yen ($172 million) for the fiscal year through March 2011.

During this fiscal year, Nissan plans to introduce 10 models, including the zero-emission Leaf. The Juke compact sports crossover went on sale in June and has been recording healthy sales, according to Nissan.

Nissan is expecting net profit of 150 billion yen ($1.7 billion) for the fiscal year ending March 31, 2011.

"We are confident to achieve our fiscal year 2010 forecast," said Ghosn.

Honda reports earnings Friday, Toyota next Wednesday.

Nissan shares rose 1.8 percent to 669 yen, while Mitsubishi Motors added 1.8 percent to 116 yen in Tokyo trading.

[Associated Press; By YURI KAGEYAMA]

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