TOKYO: Toyota Motor shares hit a record high on Wednesday after its earnings upgrade the prior day, with rivals Honda and Nissan also posting gains on expectations their solid hybrid lineups may benefit from cooling interest in electric vehicles.
Weakening momentum for battery-powered vehicles has led many overseas automakers to scale back roll-out plans for EVs or cut production targets as lower government subsidies and high interest rates make EV purchases harder for customers.
Toyota’s strong financial performance in the third quarter was helped by robust demand for gasoline-electric hybrid vehicles, the world’s top-selling automaker said on Tuesday.
Its shares were up 4% on Wednesday afternoon after jumping as much as 7.3% to a record high in the morning session, outperforming a 0.2% advance in the broad Topix index. Nissan Motor’s shares rose 2.9% in afternoon trade after gaining as much as 4.3% earlier.
Those of Honda Motor advanced 1.3% after rising as much as 2.6% earlier.
“We think the market is now rethinking the potential of hybrid products, which are a strength of Toyota,” analysts at Goldman Sachs wrote in a note released after Toyota raised its operating profit guidance by nearly 9% for the 12 months ending March 31.
The company’s progress on raising prices that helped boost its earnings per vehicle was likely the biggest driver for the higher operating profit forecast, the analysts added.
Toyota’s shares have risen 80% since the start of 2023, compared to a 69% rise in Honda’s shares and Nissan’s 47% gain over the same period.
Toyota plans to expand battery EV line-up in Europe to 6 models by 2026
Their gains easily eclipsed a 34% rise in the Topix over that period.
After posting its results, Toyota announced on Tuesday it would invest an extra $1.3 billion in its Kentucky plant in the United States for electrification efforts, including assembly of a three-row battery electric sports utility vehicle for the US market.
Comments
Comments are closed for this article.