Nissan Slows its Aggressive Expansion in China image

Nissan’s CEO, Carlos Ghosn, warned that the automaker’s aggressive expansion in China will be affected by the tensions between the two countries.

Carlos Ghosn told reporters that the company’s plan to build a new factory in Dalian in 2014 will go ahead even if last month’s anti-Japan violent protests led to a sharp fall-off in demand. He also said that additional investments in China will be carefully analyzed.

“Certainly beyond what we have decided, before going for further decisions in China, we will be very careful in assessing how much of an impact [the political situation] has on consumers’ minds,” he said.

All Japanese automakers have been hit by the consumer boycott in China, which started after Japan bought the group of islands in the East China Sea, which were claimed by China. Last month Nissan’s sales in the country fell 35%, Toyota’s sales decreased 49% and Honda saw a drop of 41%. Mr Ghosn said that Nissan might miss the earnings and global sales volume targets for this year.

“If I was telling you that we can make our sales target and our profit target independently of the heavy hit we took in China, you’d be surprised,” he said.