Toyota Motor Corp isn’t letting a global slowdown get in the way of its plans to grow, reporting a higher-than-expected quarterly profit on Thursday and raising its full-year forecast.
Even as a production shutdown in China, the world’s largest car market, has cast a pall over global automakers already struggling to cope with a downshift in demand and rising costs on next-generation technology, Toyota is betting it can sell more cars. “The global market in 2020 will be probably lower than what was the market in 2019, but you saw our forecast in terms of sales volume for 2020 and we plan to sell more cars than in 2019 – even if the market is declining,” Didier Leroy, a Toyota executive vice president, said at a press conference in Tokyo.
Toyota is targeting operating profit of ¥2.5tn ($22.7bn) for the full fiscal year through March, up from a previous projection for ¥2.4tn and broadly in line with analysts’ expectations. That contrasts with US rivals General Motors Co and Ford Motor Co, both of which lost money in the last quarter of 2019.
GM expects earnings to be flat this calendar year while Ford forecast a larger-than-expected drop in profits. Shares of Toyota rose 2.6% in Tokyo, the biggest jump since July.
The stock is just shy of its four-year high. Supplier Squeeze Toyota’s bullish outlook reflects less severe yen appreciation than it had feared, higher profit margins in North America and Europe, and relentless cost cutting – much of which has been borne by the company’s tight network of suppliers.
Japanese auto parts manufacturer Denso Corp last month slashed its profit outlook, and both it and fellow Toyota group components maker Aisin Seiki Co missed analysts’ forecasts for quarterly earnings. Toyota owns 35% of Denso and 39% of Aisin.—Gulf Times