Toyota Motor Corp. announced Tuesday its group operating profit is expected to nosedive in fiscal 2020 owing to the automaker being hard hit by the coronavirus pandemic which forced global production lines to be shuttered as sales skidded down.
Japan’s largest automaker said it expects it group operating profit to plummet 79.5 percent to 500 billion yen (4.65 billion U.S. dollars) in the current business year ending March 2021, while opting to withhold its net earnings forecast for the period ahead owing to an uncertain outlook amid the pandemic.
The Aichi Prefecture-based automaker said it forecasts global sales of 8.9 million vehicles in the current fiscal year, down 14.9 percent, with sales in the year to March standing at 10.46 million units, missing its target of 10.73 million units.
The maker of the popular Prius hybrid and Corolla models also said it now predicts sales to drop almost 20 percent to 24 trillion yen in the current year, on the heels of its first decline in three years booked in the business year ended March.
Toyota President Akio Toyoda told a press conference that despite facing the biggest crisis since the 2008 financial crash and the fact that just reporting its earnings figures had been difficult, the company was adapting itself to the hardships, while trying to protect its employees’ jobs, not just in Japan, but around the world.
“We feel no doubt, and we are not shaken in this belief,” Toyoda said.
Toyota also said it booked a 10.3 percent increase in its consolidated net profit from a year earlier to 2.08 trillion yen, marking the first increase in two years.
This was based on sales of 29.93 trillion yen, a drop of 1.0 percent, with its operating profit also slipping 1.0 percent to 2.44 trillion yen, Toyota said.
Its net profit in the January-March quarter tumbled from 459.5 billion yen from a year earlier to 63.1 billion yen, the automaker added.
Chief Financial Officer Kenta Kon, for his part, told a press conference that Toyota had seen sales in China in March and April increase at a pace quicker than expected, while its plants in the United States and Europe have gradually been brought back online after being shuttered for more than a month due to the pandemic.
With sales rising in China and global operations slowly being resumed, there is light at the end of the tunnel for the automaker, as acknowledged by Kon, although uncertainties still remain.
“We still cannot determine the timing of a recovery with any degree of certainty,” Kon said. (1 U.S. dollar equals 107.40 Japanese yen). Enditem