Economy woes stall Nissan growth

Nissan is stepping up efforts to produce energy efficient cars

Japanese carmaker Nissan has warned that its earnings could fall by 30% in the year ending March 2009.

Nissan blamed consumer blues in the sluggish US economy for its troubles.

A stronger yen, which makes Japanese exports more expensive, and higher steel and energy costs were also among the key factors.

It is a similar tale at other Japanese car firms. Toyota also expects its earnings to fall after seven years of record growth.

Nissan, Japan's third-biggest carmaker, in which Renault has a majority stake, saw its net income accelerate 68% to 137.6bn yen ($1.3bn; �681m) during the fourth quarter to 31 March 2008.

This helped its annual net income for the past 12 months reach 482.3bn yen, up from 460.8bn yen the year before.

During the period, Nissan sold a record 3.77m vehicles worldwide, an increase of 8.2% from the year before.

Sales growth was driven by strong demand in fast-growing emerging markets where sales were up 22%, surpassing the one-million mark for the first time

In Europe, sales were up 17.9% and even in the US, where consumers are battling higher household bills and steep lending costs, sales rose 1.5%.

Tougher times ahead

"In a challenging and volatile environment, Nissan demonstrated that it has reached the maturity to deliver a high level of performance," said Nissan president and chief executive Carlos Ghosn.

But he was less optimistic going forward, forecasting net income falling to 340bn yen over the next 12 months, much lower than analysts had been predicting.

The firm also announced a new five-year business plan, promising to deliver 5% revenue growth on average, supported by the planned launch of 60 new models.

It also highlighted its green credentials, pledging to introduce an all-electric car in 2010 in the US and Japan, to be marketed globally in 2012.

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