Ghosn Signals Nissan May Cut Profit Outlook

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Japan's second largest automaker says it is "realistic" to expect the company to cut its forecasts for the full year when it reports earnings next week, its chief executive Carlos Ghosn told CNBC.

"It's true, we have seen already some announcements made by competitors, revising their forecast down, which would be very realistic," Ghosn said, a day after rival Honda cut its full-year net profit by a fifth as an islands dispute between Japan and China hit sales in China. Nissan is scheduled to announce its results for the fiscal first half on November 6.

Anti-Japan protests after Japan nationalized the Senkaku Islands pushed Nissan's sales down 35 percent in September, while it had to trim production by 20 percent as showroom traffic came to a halt. While Ghosn said that customers were gradually starting to return to Nissan's stores, he said demand will not normalize before the end of the year.

"This recovery is going to take many months before we come back to some normal level," Ghosn said. "I think it's going to take way into next year before we come back to normal production."

(Read More: China-Japan Row 'Worrying,' Says Nissan CEO)

Nissan makes up a quarter of global profits in China, which means the downturn undermines its performance more heavily than its Japanese rivals. Nissan currently forecasts sales to increase 9.5 percent in fiscal 2012 to 10.3 trillion yen. Meanwhile, analysts also expect industry leader Toyota to lower forecasts when it reports next Monday.

As CEO of Renault, Ghosn is also faced with a three-year debt crisis in the euro zone that threatens to push France into recession for the first time in three years. With unemployment in France hitting 10 percent, the government of President Francois Hollande has been pressuring companies to maintain jobs; Ford Motor broke from the ranks last week when it announced it would close three factories in Europe and cut 5,700 jobs.

"We think we can avoid the situation, on the condition that we have established competitiveness in the main market and in the main base, which is France," Ghosn said.