Toyota Motor Corp President Fujio Cho said the automaker plans to expand production and sales this year, pledging "steady progress" toward lifting its global market share to 15 percent in the next decade from 12 percent.
"We must not be complacent and must remain aware of the need for further progress," Cho said in his New Year's greeting on Toyota's Web site. "I want to make 2005 a year in which we focus our energy on striving to raise the quality of our work even further."
The world's biggest carmaker by market value is making more vehicles in the US, Eastern Europe and Asia as part of its strategy to boost global market share and reduce the impact of currency fluctuations. Cho is aiming for a fifth year of record earnings in the 12 months ending March 31 and has predicted sales of 8.5 million vehicles next year.
"The biggest risk for Toyota and other Japanese automakers will be the stronger yen. Their expansion abroad is certainly the way to counter the negative effects from the currencies," said Norihito Kanai, an analyst at Tokyo-based Meiji Dresdner Asset Management Co, which manages US$2.5 billion in equities.
The yen rose 4.5 percent against the dollar last year. Every 1-yen gain cuts Toyota's annual operating profit by about ?20 billion yen (US$195 million), according to Koji Endo, an analyst at Credit Suisse First Boston in Tokyo.
Toyota will offer its Lexus luxury brand in Japan, release a compact car developed with PSA Peugeot Citroen in Europe, build the Prius hybrid car and Crown sedans in China and expand production in South Africa and Argentina, Cho said.
"We will make more luxury hybrid models hybrids," Cho said in his New Year remarks.
The first Japanese release of Lexus luxury brand vehicles is scheduled in August, including the Lexus GS sedan. Next year, Toyota will add a hybrid version of the Lexus GS.
Toyota, based in the city of Toyota in central Japan, will "rapidly train personnel required both in Japan and overseas, building up our management foundation" for global expansion, Cho said. The maker of Corolla and Camry sedans set up a global training center in 2003 to standardize training and maintain quality control as it increases overseas output. Cho said the center will go into full-scale operation this year.
Training workers will be especially important for Toyota's plan to produce Aigo compact cars with PSA this year in the Czech Republic and the Camry sedan in China with Guangzhou Automobile Group Co Chairman Hiroshi Okuda has said the company may build a factory in Russia.
Toyota, which is forecasting group vehicle sales to rise 7 percent this year, is poised to overtake General Motors Corp as the world's biggest automaker by unit sales as early as next year, according to Endo of Credit Suisse First Boston.
Toyota will open a new factory in Texas in 2006 and plans to build gasoline-electric hybrid vehicles in North America at an existing factory.