Japanese electric motor maker Nidec Corp slashed its full-year operating profit forecast by nearly a fifth on Wednesday, warning of uncertainty in demand and intensifying price competition in China’s electric vehicle market.
The Kyoto-based manufacturer cut its operating profit forecast for the financial year to March 31 by 18% to 180 billion yen ($1.22 billion), versus an average forecast of 219.7 billion yen by 18 analysts surveyed by LSEG.
Third-quarter operating profit nearly doubled to 53.6 billion yen, compared to 28.0 billion yen a year earlier. That was slightly lower than a 55.6 billion yen average profit in a survey of eight analysts by LSEG.
Nidec has invested heavily in developing and manufacturing an e-axle traction motor that combines an EV’s gear, motor and power-control electronics, and is keen to expand the business in China and parts of Europe.
The company said in presentation materials it expected to book expenses for structural reforms of its battery EV business before improving the segment’s profitability.
It aims to improve its battery EV business in China through limiting unprofitable orders and localising product development and procurement, it said. ($1 = 147.9500 yen)