Toyota Motor Corp. today raised its full-year profit forecast by 39 percent, capping industry earnings that point to a faster-than-expected recovery from the record March 11 earthquake and tsunami. Hit the jump to read the rest of the story.
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The automaker also said it posted an operating loss of 108 billion yen ($1.4 billion) in the April-June quarter, compared with a 211.7 billion yen profit a year earlier. The result was better than the average loss estimate of 190 billion yen in a survey of six analysts by Thomson Reuters.
Toyota posted a first-quarter net profit of 1.2 billion yen compared with a 190.5 billion yen net profit the previous year. Revenue fell 29.4 percent to 3.44 trillion yen.
Toyota raised its net income forecast for this fiscal year to 390 billion yen ($5 billion) from an earlier forecast of 280 billion yen, compared with net income of 408 billion yen last fiscal year. Sales may rise to 19 trillion yen, higher than the estimate of 18.6 trillion yen made June 10.
The automaker’s revised outlook came a day after Honda Motor Co. raised its profit forecast 18 percent in the aftermath of the magnitude-9 temblor that damaged parts factories and power plants. Nissan Motor Co. also beat analyst estimates with first- quarter net income of 85 billion yen, and it may consider revising its forecast after the second quarter, Corporate Vice President Joji Tagawa said July 27.
“The Japanese carmakers are recovering more quickly than earlier expected,†said Tadashi Usui, an analyst at Moody’s K.K. in Tokyo. “The challenge post-recovery is how competitive they can be in this very difficult operating environment.â€
Hyundai advantage
“Because of the quicker recovery, we’ve been able to push up our production and sales plans,†Senior Managing Officer Takahiko Ijichi said in Tokyo today. “We are working to improve our profit structure globally so that we can better last year’s result even if it’s just by the slightest margin.â€
Global vehicle sales dropped 33 percent to 1.22 million in the three months ended June 30, the automaker said. Sales plunged 48 percent in North America and 42 percent in Japan. Deliveries in Asia, excluding Japan, fell 9 percent to 259,000 units.
The difficulties for Japanese carmakers are compounded by the yen’s surge against the dollar and South Korean rival Hyundai Motor Co.’s increased production to take advantage of Japanese factory shutdowns.
Hyundai’s second-quarter profit gained 37 percent to 2.3 trillion won ($2.2 billion). Its U.S. market share rose to 5.1 percent this year through June from 4.6 percent last year, while Toyota and Honda have lost ground, according to Autodata Corp., a New Jersey-based research company.
Yen strength
“Hyundai was a strong competitor even before the quake, and the disaster gave it even more of an advantage to expand sales,†said Yoshiaki Kawano, an analyst at consulting company IHS Automotive. “Toyota is recovering at a faster-than-expected pace, but it needs to introduce its new models as soon as possible to compete with Hyundai.â€
The strength of the Japanese currency, which is close to a post-World War II high, cuts the value of repatriated earnings from exports. The yen gained 11 percent against the dollar in the April-June quarter from a year earlier and traded at 77.18 yen today.
A 15-yen change in the exchange rate over the past year has “blown off†300,000 yen, or $3,900, in profit on a $20,000 car, Ijichi said.
“Frankly speaking, losing 300,000 yen per vehicle is a real drag,†he said.
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