February 7, 2018 / 3:21 AM / a year ago

Nissan sees China growth outpacing market this year, slower than 2017

BEIJING (Reuters) - Japanese carmaker Nissan Motor Co Ltd and its Chinese joint-venture partner aim to sell over 1.6 million vehicles in China this year, indicating more muted expectations for growth in the world’s biggest auto market this year.

Nissan's logo is pictured on an engine of Maxima model during the Auto China 2016 auto show in Beijing, China April 25, 2016. REUTERS/Kim Kyung-Hoon

The target, up from the 1.52 million vehicles it sold in China in 2017, suggests growth of at least 5.3 percent, faster than the official forecast for the country’s overall market, but slower than Nissan’s 12.2 percent growth in China last year.

China’s car market is slowing amid a government-backed shift towards new-energy vehicles (NEVs), referring to all-electric battery cars and plug-in electric hybrids. The auto market is estimated to grow around 3 percent this year, versus NEV sales growth of around 40 percent.

“We’ve told our dealers and others we aim to sell more than 1.6 million vehicles this year,” Nissan’s China chief Jun Seki told Reuters ahead of the formal announcement. Seki is president of Dongfeng Motor Co Ltd, a 50-50 joint venture between Nissan and China’s Dongfeng Motor Group Co Ltd.

The Yokohama-based automaker confirmed the target publicly on Wednesday afternoon, when it also announced that its sales in China had risen 13.1 percent in January from a year earlier to 135,037 vehicles.

Nissan is due to report third-quarter earnings on Thursday.

The automaker’s China venture is, however, privately aiming to sell well over 1.6 million vehicles this year, two Nissan executives said.

“Internally we are intending to sell significantly more than 1.6 million vehicles. We want to sell at least 1.7 million vehicles or more,” said one of the executives. Both declined to be identified because they are not authorized to speak with the media.

Charles Shen, a Nissan spokesman, declined to comment on any internal goals.

Nissan earlier this week said it planned to invest 60 billion yuan ($9.5 billion) in China over the next five years with its joint-venture partner as it seeks to become a top-three automaker in the world’s biggest market.

Long stuck as a second-tier player in China, Nissan said it plans to boost its sales volume to 2.6 million vehicles a year by 2022.

Rival Japanese carmaker Toyota Motor Corp said last week it aimed to sell 1.4 million vehicles in China this year, nearly 9 percent more than 2017, though executives said the target would be tough to meet.

Reporting by Norihiko Shirouzu; Editing by Adam Jourdan and Christopher Cushing

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