Toyota Motor Corp yesterday said its net profit for the three months to June jumped 10 percent from a year ago, crediting a weak yen and cost cuts, while it also boosted its annual sales forecast.
The Corolla and Camry maker earned ¥646 billion (US$5.2 billion) in the quarter, while revenue rose 9.3 percent to ¥6.98 trillion, as it separately announced an overhaul of its operations in China, the world’s biggest vehicle market.
However, the Japanese giant’s vehicle sales were slightly lower at 2.1 million vehicles in the quarter.
Photo: EPA
“Favorable foreign exchange rates and cost reduction efforts were [the] main positive factors, while decreased vehicle sales and increased expenses ... were negative factors,” Toyota managing officer Tetsuya Otake said in a statement.
Toyota said it now expected revenue for the fiscal year to March next year to come in at ¥27.8 trillion, edging up from an earlier 27.5 trillion yen estimate, while net profit would be ¥2.25 trillion for the year.
Last quarter, sales in the key North American market rose, while they turned down in Europe and Asia, including Toyota’s home market Japan, where consumer spending dived after the government hiked sales taxes last year.
The company did not break out sales for China in the period, but General Motors Co and Volkswagen AG have been outselling Toyota in the huge market.
Separately, Toyota said it was reorganizing its Chinese operations, including adding a new production line at one plant that would boost capacity by 100,000 vehicles annually.
The changes underline a “commitment to plants that are competitive, rather than plants that simply aim to maximize production,” the company said.
Last week, rivals Honda Motor Co and Nissan Motor Co both reported strong results, but observers warned over the threat of a China slowdown and costs tied to a massive exploding airbag crisis.
“Concerns over recalls related to Takata’s airbags continue to cast a shadow on the sector,” said Yasuo Imanaka, analyst at Rakuten Securities in Tokyo. “Unexpected, massive recalls are a sizable risk for any automaker.”
Toyota is working to recover its reputation for safety after the recall of millions of cars globally for various problems, including the problems at embattled supplier Takata Corp.
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