Nissan forecasts global deliveries will climb 8.9% to 5.65 million vehicles this fiscal year, representing a global market share of 6.7%

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Nissan Motor Co. (7201), Japan’s second-biggest carmaker, forecast profit that missed analysts’ estimates, as intensifying competition drives up incentive spending in the U.S.

Net income will climb 4 percent to 405 billion yen ($4 billion) in the year ending March 31, the highest since the 2008 fiscal year, the Yokohama, Japan-based company said in a statement yesterday. That’s about 5 percent below the average of 20 analyst estimates compiled by Bloomberg.

Nissan joins Toyota Motor Corp. (7203) and Honda Motor Co. in predicting smaller profits than analysts estimated, as the benefits from a weaker yen fade and Japanese automakers brace for a record decline in domestic demand because of the nation’s first sales-tax increase in 17 years. Chief Executive Officer Carlos Ghosn also faces incentive spending levels that are higher than the average of Asian auto brands in the U.S.

“Everybody seems to be conservative in their forecasts,” said Koji Endo, a Tokyo-based analyst at Advanced Research Japan. “The yen is stabilizing, the competition in the U.S. is getting fierce and the domestic market will decline this year.”

Nissan gained 4.8 percent, the most intraday since Jan. 8, to 911 yen as of 9:13 a.m. in Tokyo trading. The stock has risen 3.1 percent this year, compared with the 10 percent drop in the benchmark Topix Index. (TPX)

To continue reading this article, please go to http://www.bloomberg.com/news/2014-05-12/nissan-profit-forecast-misses-estimates-on-fading-yen.html

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