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Toyota Forecasts Drop in Profit for Fiscal Year

May 13, 2014
2 min to read


Via NY Times


TOKYO — Toyota achieved a record annual profit and sales of more than 10 million vehicles for the first time, but on Thursday forecast a slower year ahead as the momentum from a weak yen fades.


Expenses like the $1.2 billion penalty that Toyota paid in a settlement with the United States Justice Department this year for hiding information about defects in its cars hurt its profit for the January-to-March quarter, the carmaker said.


Toyota, the world’s top-selling automaker, is forecasting a profit of 1.78 trillion yen ($17.5 billion) for the financial year ending in March 2015.


That is about 2 percent lower than the company recorded for the financial year that just ended, when its profit almost doubled to a record ¥1.82 trillion.


Annual sales rose 16 percent to ¥25.69 trillion, helped by a weak yen, which aids Japanese exporters, and thanks to growth in the United States, Europe, Japan and the rest of Asia.


Toyota says Japan sales were inflated in recent months as consumers rushed to buy before a tax increase that kicked in on April 1.


Toyota became the first automaker to sell more than 10 million vehicles in a 12-month period, with sales totaling 10.13 million vehicles around the world for the year that ended in March.


The company, maker of the Prius hybrid, Lexus luxury line and Camry sedan, is expecting solid growth to continue, hoping to sell 10.25 million vehicles globally for the year through March 2015.


Highlighting its ambitions, it noted that extra costs, including research and development expenses, as well as the United States penalty, were a factor in reducing its January-to-March profit to ¥297 billion from ¥313.9 billion a year earlier.


Toyota sold fewer vehicles in North America for the fourth quarter — 567,000 vehicles, compared with 603,000 vehicles in the same period the previous year.


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