The Kyoto-based firm's shares were last down 10.4% in afternoon trading, a move that would mark the heaviest loss in a single session since November 2008 and wipe out about $2.7 billion in its market value.
Nidec's declining margins in the Chinese automotive business were pointed out by analysts as a cause for concern, a trend they said could signal weakness in the broader global electric vehicle market.
"The e-axle market in China is shifting more rapidly than expected to lower output motors and that is having a detrimental impact on profitability," analyst Mark Chadwick wrote on the Smartkarma research platform.
"We are still concerned about the outlook for the Chinese EV market and the shift to lower output motors, which is impacting profitability."
Nidec has invested heavily in the production of a traction motor called e-axle, which combines an electric vehicle's gear, motor and power-control electronics, for which it has been seeking to tap opportunities in China.
Company executives said at a press conference on Tuesday this part of the business was expected to post a loss of 15 billion yen ($100.24 million) in the current financial year. The firm had previously said it expected the e-axle business to turn profitable this financial year.
After the market close on Monday, the company announced a smaller-than-expected 7.6% rise in quarterly operating profit, helped by a weaker yen currency.
It said it posted a decline in unit growth rate in the Chinese electric vehicle market in its automotive products segment as a whole in the second quarter.
The company's unchanged profit outlook of 220 billion yen ($1.47 billion) for the current year to March 2024 also came in short of the average market profit estimates of 224 billion yen.
($1 = 149.6400 yen)
