Asian carmakers are taking hits to their profits from having to spend more to move metal in America.
Nissan Motor Co. and Hyundai Motor Co. both cited higher incentive spending in the U.S. as reasons behind a slump in quarterly profit, with a political backlash in China adding to a cloudy outlook for Hyundai, South Korea’s largest automaker. More evidence of the industry’s pain is likely to come next week, with Toyota Motor Corp. and Honda Motor Co. scheduled to report earnings.
“Competition is rising in the U.S.,” Joji Tagawa, a Nissan corporate vice president, said Thursday at the company’s earnings briefing in Yokohama, Japan. Marketing and selling expenses were the biggest contributor to its 13 percent decline in operating profit. The company spent $4,086 on incentives for each vehicle last month, the highest level among Asian auto brands, according to Autodata Corp.