Japan's export credit agency to lend $2bn to Nissan for US sales financing
Japan's state-owned export credit agency has agreed to give Nissan Motor Co up to $2bn (roughly R30,279,000,000) as part of a credit agreement to help it finance car sales in the US.
The money is part of a $4.1bn (roughly R62,071,950,000) credit agreement for Nissan Motor Acceptance Corporation, a unit of Nissan North America, Japan Bank of International Cooperation (JBIC) said in a press release on Wednesday.
The money should help the Japanese company sell cars in the world's second-biggest car market after China by allowing it to provide customers with loans that they can repay in monthly instalments, the export credit agency added in the statement.
The US “is an important market for Japanese automobile manufacturers. Sales finance has become an important tool in business strategy”, JBIC said.
“This case provides financial support for Nissan's overseas business development,” it added.
JBIC has provided loans for overseas sales financing to other automakers, including a $78m (roughly R1,180,920,000) October agreement with Honda Motor Co in Brazil, and one in September for Toyota Motor Corp in SA. JBIC did not disclose the amount for that deal.
The latest agreement with Nissan is more than three times as much as a $582m (roughly R8,811,480,000) loan extended by JBIC in July to help it finance car sales in Mexico.
A JBIC spokesperson said the government export credit agency applied the same lending standards as private banks.
Nissan, Japan's third-largest automaker, is focusing on key markets as it pulls back from the rapid expansion led by ousted chairperson Carlos Ghosn.
It is looking to raise market share with new models in the US, China and Japan as they rebound from a demand slump triggered by the Covid-19 pandemic.
“We have financing from a variety of different ways and JBIC is one of them,” a Nissan spokesperson said.
This month, Nissan cut its operating loss forecast for the year to March 2021 by 28%, albeit still to a record of about 340 billion yen (roughly R48,448,000,000), helped by a rebound in demand, particularly in China.