Japanese auto giant Nissan said Friday it had lowered its sales and profit forecasts for the fiscal year that ended on March 31, citing higher costs.

‘The forecast sales volume has been lowered to 3.44 million units, net revenue to 12.6 trillion yen ($81.6 billion), and operating profit to 530 billion yen. Net income is expected to reach 370 billion yen for fiscal year 2023,’ it said in a statement.

The firm previously estimated revenue of 13 trillion yen, operating profit of 620 billion and net income of 390 billion.

The firm said the revision was made because of lower sales volumes and higher costs paid to suppliers and other factors.

Nissan had already in February lowered its unit sales volume projection from 3.7 million to 3.55 million, citing ‘temporary logistics disruption and intensifying competition’.

On Friday it reiterated that under its recent new business plan, it aims to increase annual global sales volume by one million units by the end of fiscal year 2026 and accelerate the transition to electric vehicles.

‘To successfully deliver the plan, Nissan will adopt more efficient ways to collaborate with suppliers,’ the statement said.

Under the strategy announced last month Nissan aims by 2030 to make electric models at the same price as traditional combustion engine cars.

While pledging to improve the firm’s bottom line globally, CEO Makoto Uchida said on March 25 that Nissan had experienced difficulties in the Chinese market.

‘Honestly speaking, we have struggled there in terms of sales volume. In the last five months, things have improved somewhat. But still, our capacity remains excessive,’ he said at a news conference.

‘By working with joint venture partners (in China), we will continue to optimise our production levels and work with products that allow us to grow in the market,’ Uchida said.

Rival Honda said last month it was exploring a strategic partnership in electric vehicles to face up to a ‘once-in-a-century’ industry upheaval.

China overtook Japan as the world’s biggest vehicle exporter last year, helped by its global dominance in the EV market.

Japanese giants including Toyota and Nissan have also been more cautious than their Chinese counterparts such as BYD on EVs, banking instead on hybrid models.

Nissan’s full-year results are due to be announced on May 9.