May 19, 2024

After Quake, Toyota’s Profit Plummets 77%

Still, the automaker said it could not forecast earnings or production for the year ahead because of uncertainty about its ability to resume normal output levels.

Toyota said the disaster in Japan cut operating income by 110 billion yen ($1.36 billion) even though it occurred only three weeks before the end of the quarter.

The strong yen also hurt earnings in the period, when net income was 25.4 billion yen ($314 million ), down from 112.2 billion yen a year earlier.

Toyota’s operating profit declined 52 percent, to 46.1 billion yen ($571.5 million), less than half the 96.1 billion yen ($1.2 billion) that analysts had projected. Sales in the quarter fell 12 percent, to 4.6 trillion yen ($57 billion).

Results in the current quarter — the first period of its fiscal year, which started April 1 — are expected to take a much bigger hit because of the earthquake. Toyota is almost certain to lose its title as the world’s largest automaker this year, perhaps falling to third place behind General Motors and Volkswagen.

“With gas prices as high as they are — almost $4 per gallon — Toyota should be in a prime spot to win market share, but the supply simply isn’t there,” said Jessica Caldwell, director of industry analysis at, a car-buying information site. “Toyota shoppers are starting to expand their consideration to other brands.”

Toyota said its production, which has been running at about 50 percent of normal globally and 30 percent in North America, would begin recovering in June across all regions of the world. Previously, it had said output would start to normalize in July in Japan and in August elsewhere.

It said production would continue to follow the schedule announced last month through June 3, then rise to about 70 percent of normal in June. It did not say whether plants would return to predisaster levels sooner than the November-to-December estimate given earlier.

The company said it hoped to release a sales and earnings forecast by the middle of June.

Toyota officials in the United States said North American output would climb to 70 percent of normal in June, and that production of eight models, including the popular Camry and Corolla sedans, would return to 100 percent at that time. It did not say when assembly of three models built in North America — the RAV4 and Lexus RX crossover vehicles and Tundra pickup truck — would return to normal levels.

In a statement, Toyota said it was “carefully monitoring the situation in each region and for each vehicle model and is every day working its hardest to identify every way to restore production as much as possible” but that in the meantime, “reduced production levels may have a significant impact” on its financial results.

For the full fiscal year ended March 31, Toyota’s net profit grew 94 percent, to 408.1 billion yen ($5.1 billion), and operating income more than tripled, to 468.2 billion yen ($5.79 billion). Revenue rose 0.2 percent, to 19 trillion yen ($235 billion).

“Our business environment continued to be challenging due to yen appreciation among others,” Toyota’s president, Akio Toyoda, said in a conference call with analysts. “Nevertheless, we managed to improve our profit structure even further thanks to the support from all our stakeholders, in particular our customers.”

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