Nissan has slashed its profit forecast for the full year by 15% and replaced its number two in command following a disappointing quarter that the automaker blamed on costs related to recalls and volatile demand.
The second largest automaker in Japan by sales announced on Friday that the new forecast for income is $3.6 billion, which is down from the previous forecast of $4.26 billion.
The automaker cited a slow demand across Europe and the volatile conditions existing in emerging markets that include Brazil and Russia, along with more than expected costs for product recalls.
The Japanese automaker said that it longstanding COO Toshiyuki Shiaga, who was once a consideration as a possible heir to Carlos Ghosn the CEO, would step aside. The move is seen as a response to a number of missteps of recent by the carmaker as it goes through rapid expansion.
CEO Ghosn said not all the emerging markets were so volatile, as they performed well in China. However, Nissan was hit hard in Australia, Brazil, Indonesia, Russia and Thailand.
The problems for the automaker in the emerging markets during the most recent quarter mirror the wider trend in the industry, with General Motor, Fiat-Chrysler and Volkswagen all reporting this week a cooling in the growth in markets like South America and South Asia, with demand in the U.S. sustaining much of the profits in the industry.
Ghosn, who is also in charge of France’s Renault, as part of a strategic alliance, has but his reputation on the line and the future of the carmaker on the aggressive push into the new emerging markets.
In 2013, the Japanese carmaker said it would be resurrecting the Datsun line, after it had been absent for over 30 years. It is also rolling out a brand that is low budget in the country of India, followed then by Indonesia, South Africa and Russia over a period of two years.
Last month Nissan said it would become the first international carmaker building cars in Myanmar and would start assembling cars in Nigeria. The automaker also is aiming to double its sales by 2016 in Africa to over 220,000.
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