Toyota predicts 20 Percent full-year profit drop after strong Q4

Toyota predicts 20 Percent full-year profit drop after strong Q4 (Image: Reuters)

VoM News Desk | May 8, 2024 | 10:55 AM IST | Breaking News | Follow on Google News

Toyota predicts 20 Percent full-year profit drop after strong Q4

Toyota predicts 20 Percent full-year profit drop after strong Q4

TOKYO, May 8 (Reuters) – Toyota Motor (7203.T), opens new tab forecast a 20% decline in operating profit for the current financial year on Wednesday, after reporting a blockbuster 78% profit increase in the fourth quarter that just ended.

The world’s top-selling automaker expects operating income to total 4.3 trillion yen ($28 billion) in the year to March 2025, versus 5.35 trillion yen in the year that just ended.

Toyota said the forecast took into account investments of 380 billion yen in “human capital”, including providing support for labour costs of suppliers and dealers, as well as investments for its “multi-pathway” strategy.

That strategy, of pursuing multiple types of powertrain for cars – including hybrids, plug-in hybrids and battery EVs – appears to be paying dividends for Toyota as drivers have cooled on EVs in many markets in recent months.

In the January-March fourth quarter, Toyota delivered a 78% increase in operating profit, of 1.11 trillion yen. That compared to the 747.3 billion yen average of nine analyst estimates compiled by LSEG.

The result was helped by the weak yen lifting the value of overseas sales, as well as solid demand.

Still, Toyota is not without its challenges, particularly in key markets such as China, where it has struggled to keep up with the pace at which a growing number of local manufacturers are rolling out software-loaded electric vehicles.

($1 = 155.1400 yen)

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