Nissan Operating Profit Slides

Lack of new models to blame.

Suffering from a lack of new model launches, Nissan Motor reported Oct. 26 a 15.3% drop in first-half operating profits. Operating profit fell to 348.65 billion yen (US$2.94 billion) as the group continued to struggle in its domestic market, reported Nissan Motor Co., which is owned 44% by Renault.

Net profit rose by 18.8 % to 274.18 billion yen in the six months to September from a year earlier, boosted by the sale of shares in its former truck-making division, as revenue rose one percent to 4.53 trillion yen.

The "drought" of new products was a mistake and the company will strive not to make the same mistake, Nissan chief executive Carlos Ghosn said. "Above all, this industry is about product, fresh product, attractive product, product closely attuned to market trends."

Ghosn also said that the company was still open to a third automaker to joining its alliance with Renault, after recently ending talks with General Motors about a possible tie-up. "We are confident in our ability to compete without a third partner. We have no need, no hurry to find more partners and we are not taking any initiatives.

In March Nissan announced it would sell 13% out of its 19% stake in Nissan Diesel Motor to Sweden's Volvo for about $195 million. The Japanese firm announced last month that it had agreed to send the remaining 6% to Volvo for about $70 million.

Copyright Agence France-Presse, 2006

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