TOKYO: Toyota Motor Corp on Wednesday forecast a 10% rise in annual operating income after its latest quarterly profit surged 35%, as the world’s largest automaker expects higher sales in major markets amid an easing of global chip supply woes.
“We expect an increase in sales volume in all regions and production volume of 10.1 million (vehicles), due to such factors as … improvement in semiconductor supply,” Toyota said in a statement.
The Japanese auto giant said operating profit for the three months through March totalled 626.9 billion yen ($4.64 billion), easily beating the average 553.46 billion yen profit estimated by 10 analysts, according to Refinitiv data.
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The result was helped by the weak yen boosting the value of overseas sales, and higher output volumes that outweighed the impact of surging materials costs.
In the same period a year ago, operating profit was 463.86 billion yen.
In the first earnings presentation led by new CEO Koji Sato, who took the top job last month, Toyota forecast operating profit will rise about 10% to 3.0 trillion yen this business year, in line with analysts’ average forecast of 3.02 trillion yen.
Toyota shares, which were nearly flat just before the release of the earnings, surged immediately after their publication and were up 2.2% at 1,958 yen by 0500 GMT.
Though retaining its crown as the world’s top-selling automaker, Toyota faces a raft of challenges going forward.
It’s under pressure in China, the world’s biggest auto market, where a rapid shift to electric vehicles (EVs) has hurt demand for the gasoline-powered cars that drove Toyota’s early successes there. It also must handle problems at affiliate Daihatsu, which rigged safety tests for some Toyota-branded cars.
Seeking to raise its game in the EV sector, where it has been outstripped by new Chinese automakers as well as EV giant Tesla, Toyota has said it will introduce 10 new battery-powered vehicles, targeting sales of 1.5 million EVs a year by 2026.
It aims to set up a dedicated unit to focus on next-generation battery EVs, executives on the company’s new leadership team said last month.
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