Toyota has announced a fall in global operating profits of 43 percent over the last financial quarter despite seeing a small 2.5 percent increase in sales around the world.
The profit hit comes as a result of a weakened Yen against key global currencies, with analysts also identifying Toyota’s reliance on passenger cars in major markets like the US in place of higher-margin pickup truck sales as reasons for the profit slump.
Globally, Toyota produced 4,363,537 vehicles from April until September, an 85,530 unit increase over the same period last year. But that wasn’t enough to hold back a 7.2 percent slide in net revenues, and an operating income loss of 29.5 percent.
Toyota is still firmly in the black however with an operating profit of US$4.69 billion (A$6.03 billion), but tough economic conditions in the US have forced the company to revise its sales targets downward, where hybrid sales have slowed in the face of low fuel prices.
US sales decreased by 12,695 units, but sales in Japan increased by 94,413 units, while Europe rose by 27,029 units and Asian region sales jumped by 111,184 units, though sales in Central and South America, Oceania, Africa and the Middle East fell by a combined 134,401 units.
Plans are already underway for the world’s largest automaker to enter into a restructuring phase in an effort to reduce internal costs and this, combined with a softening of exchange rate difficulties, should see Toyota’s financial results improve before the end of the Japanese financial year in 2017.
In response, Toyota has lifted its profit forecasts for the financial year slightly, while announcing a 100 Yen per share dividend for the quarter while embarking on a 40 million share buyback of the company’s common stock.
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