Toyota profits tumble in FY2011, pledges recovery

May 9, 2012
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Toyota Corolla steering/AFP
TOKYO, May 9 – Japan’s Toyota Motor said Wednesday net profit for the year to March fell 30.5 percent to 283.56 billion yen ($3.56 billion), hit by Japan’s quake-tsunami disaster and record flooding in Thailand.

But Japan’s biggest automaker, also stung by the strong yen, pledged a sharp rebound in the current fiscal year, expecting net profit to more than double to 760 billion yen on surging demand in emerging markets.

Toyota also forecast operating profit to nearly triple year-on-year to 1.0 trillion yen as consumers opt for small and economically priced vehicles, as well as “green” models, a key segment for the manufacturer.

“Our vision is to establish a strong business foundation that will ensure profitability under any kind of difficult business environment,” President Akio Toyoda said in a statement.

“Certainly the last fiscal year was extremely challenging due to the natural disasters in Japan and Thailand, plus the unprecedented strength of the yen.”

Japanese automakers were hammered last year by the country’s huge earthquake and tsunami, which caused enormous production problems, while the later Thailand flooding created supply-chain headaches for firms with plants there.

The yen, which hit a record high against the dollar in 2011, began to weaken early this year, a decline that will help exporters whose products become more expensive overseas when the currency strengthens.

Toyota, which said it sold 7.35 million vehicles in the year to March for total sales of 18.58 trillion yen, down 2.2 percent, lost its number one spot in the global carmakers’ league last year.

The company had been the world’s biggest automaker since 2008 and sold 8.42 million vehicles in 2010.

But its 2011 figure leaves US giant General Motors, with about 9.0 million in unit sales, back in top spot after it emerged from bankruptcy, with Germany’s Volkswagen in second place, selling more than 8.0 million vehicles.

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