Toyota ramps up full-year forecasts

Japan's top car maker now projects net profit of 1.42 trillion yen ($137 billion) for the fiscal year to March 2021, up from an earlier estimate of 730 billion yen

Tokyo: Toyota on Friday almost doubled its full-year forecasts, saying sales and production were recovering quickly from the coronavirus pandemic, which has shredded the global auto market this year.

Japan’s top car maker now projects net profit of 1.42 trillion yen ($137 billion) for the fiscal year to March 2021, up from an earlier estimate of 730 billion yen. It said full-year sales are now expected to hit 26 trillion yen, against a previous estimate of 24 trillion yen.

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Results for the first half appeared sluggish compared with the previous year, with net profit down 45.3 per cent at 629.4 billion yen. But the signs of recovery were clear in the second quarter, with bottom-line profit at 470.5 billion yen against 158.8 billion yen in the previous quarter, when the pandemic was hitting hard.

Carmakers around the world have been battered by the coronavirus crisis, with many relying on government help, as it slammed the global economy into reverse and forced people to stay at home. But Toyota last week reported both global production and sales hit record highs for September, marking the first gains in nine months. “I think we were able to recover (in the second quarter),” chief operating officer Kenta Kon told reporters, saying “sales outlets and suppliers made efforts to deliver as many vehicles as possible”.

He said the firm also benefited from a “foundation of measures” put in place since the 2008 financial crisis. “The impact of the pandemic has yet to be fully erased, but Toyota swiftly recovered in the July-September period,” said Satoru Takada, auto analyst at TIW, a Tokyo-based research and consulting firm.

“While we can’t be too optimistic, both sales and production are still on course to recovery,” Takada said. “Given the severe business environment, Toyota is outperforming its domestic rivals,” he added.

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