Nissan Motor Co. Ltd, having the largest market share in Russia together with its partners Renault SA and OAO AvtoVAZ, announced that it has decided to stop taking orders for some of its vehicle models in the country. In addition, the company revealed that it intends to continue increasing the prices in case that the Russian ruble continues to depreciate.
The Japan-based company has already raised prices on half of its vehicle models, that are being sold in Russia, by a range of 5% to 8%. The Chief Executive Officer Carlos Ghosn explained that the prices of models that use more imported parts had been boosted.
Mr. Ghosn said in an interview, cited by Reuters: “We have suspended taking orders. We didnt do it (suspend orders) overall, just on some models we said, Sorry, until we see where this situation is going we dont take orders.”
According to the companys CEO, Nissan also plans to boost its production in Japan, as well as to increase the exports from the country in order to take advantage of the current yen weakness.
As reported by Bloomberg, The Chief Executive Officer of the car manufacturer added: “When the ruble sinks it’s a bloodbath for everybody. It’s red ink, people are losing money, all car manufacturers are losing money.” Ghosn also noted that Nissan is to keep following its long-term strategy to locate as much production where the automobiles are sold.
The Russian ruble has fallen by almost 50% against the US dollar so far this year. This put some auto manufacturers under pressure, as they were forced to raise prices and face the constantly decreasing demand.
Nissan Motor Co. Ltd was up 0.71% to close at JPY 1 056.5 per share today, marking a one-year increase of 21.30%. The company is valued at JPY 4.74 trillion. According to the Financial Times, the 25 analysts offering 12-month price targets for Nissan Motor Co. Ltd have a median target of JPY 1 160, with a high estimate of JPY 1 500 and a low estimate of JPY 980.00. The median estimate represents a +10.58% increase from the last price of JPY 1 056.5.
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