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Thu, Aug 05, 2010 - Page 10 News List

Toyota posts profit, raises forecast

AFP , TOKYO AND CHICAGO

Toyota yesterday reported a quarterly profit of US$2.2 billion and raised its forecast for the year despite its recall woes, betting on robust Asian demand to drive its rebound from the financial crisis.

The world’s largest automaker raised its annual net profit forecast to ¥340 billion (US$3.9 billion) from the ¥310 billion forecast in May, despite recent worries over the global economy and the yen’s strength.

Toyota reported a net profit of ¥190.47 billion for the quarter ended June, turning around a loss of ¥77.8 billion in the same period a year earlier and beating forecasts. The automaker’s strong results come despite its recall of about 10 million vehicles worldwide, as it faces a host of lawsuits over “unintended acceleration” issues blamed for more than 80 deaths in the US.

Despite the recall crisis, Toyota saw sales in North America increase 36 percent in the quarter ended June compared with the same period a year ago.

Sales in Japan increased 23 percent year-on-year, buoyed by government consumer incentives to buy environmentally friendly vehicles.

“In Japan, sales centred on hybrid cars were strong. Thanks to the extension of subsidies for purchases of environmentally-friendly cars, sales largely exceeded those of the previous year,” senior managing director Takahiko Ijichi said.

However, sales in Europe slowed 12 percent as the eurozone debt crisis ate into consumer sentiment. Ijichi warned that the expiration of incentive programs in Japan may also pose a risk later in the year.

“We note a lack of visibility concerning currency movements and the possible backlash in demand after the end of the demand-stimulus programs in Japan, which requires our close monitoring,” he said.

However, Toyota — along with another Japanese maker, Honda — saw sales in the US drop last month, as the Big Three US automakers posted modest gains thanks to popular new vehicles.

Total industry sales were nonetheless up 5.1 percent last month to 1.05 million vehicles or a seasonally adjusted annualized rate of 11.98 million, figures released by Autodata on Tuesday showed.

Light vehicle sales rose 14.7 percent at 5.81 million vehicles in the first seven months of the year.

Toyota posted a 3.2 percent drop to 169,224 vehicles last month, while year-to-date sales were up 7.5 percent at 1.02 million vehicles. Honda saw sales fall 2 percent to 112,437 vehicles last month, while year-to-date sales were up 9.4 percent at 706,346.

General Motors reported a 5.4 percent increase to 199,692 vehicles last month, the 10th consecutive month of sales gains following a government-financed restructuring under bankruptcy protection.

Ford reported a 3.1 percent increase in total sales to 170,411 vehicles, while Chrysler posted a 5 percent increase in sales last month to 93,330.

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