TOKYO (Reuters) – Japanese electric motor maker Nidec Corp slashed its full-year operating profit forecast by nearly half on Tuesday as it faced pressure from weakening demand for technology goods and a slower-than-expected recovery of the global car industry.
The company cut its operating profit forecast for the financial year through March by 48% to 110 billion yen ($845 million).
That was worse than expectations for a full-year operating profit of 202.5 billion yen based on estimates from 20 analysts, Refinitiv data showed.
For the third quarter through December, the Kyoto-based firm reported an operating profit of 28 billion yen, down 37% from 44.3 billion yen a year earlier. That was also lower than a 51.34 billion yen average profit estimated by six analysts.
As it seeks to capture a share of the global electric vehicle market, the company is investing heavily in production and development of a traction motor called e-axle, which combines an electric vehicle’s gear, motor and power-control electronics.
Nidec, which will mark its 50-year anniversary in July, forecast last quarter that its e-axle business will reach profitability in the financial year starting from April.
It has begun producing a second-generation model of its e-axle system in Guangzhou, China in September.
($1 = 130.1300 yen)
(Reporting by Daniel Leussink; Editing by Chang-Ran Kim and Sherry Jacob-Phillips)
