Toyota Motor Corporation recorded record-high sales in the first to third quarters of fiscal 2022, but its net profit and operating profit fell in the aftermath of rising raw material prices, the report showed. However, in the third quarter of the fiscal year, it succeeded in offsetting the impact of raw material prices on the back of the weak yen and rising sales.
Toyota Motor Corporation announced on the 9th that it earned a record high of 27.464 trillion yen in sales between April and December last year. This is an increase of 18.0% compared to the same period last year. However, net profit fell 18% year-on-year to only 1.899 trillion yen. Toyota Motor Corporation sets the start of the fiscal year in April, and April to December last year corresponds to the first to third quarters of fiscal 2022. It is the first time since 2020 that net profit posted during the period has decreased compared to the previous year.
Operating profit fell 17% to 2.98 trillion yen. However, operating profit surpassed 1.9364 trillion yen in the third quarter of the fiscal year, increasing 22% year-on-year and turning to an increase in the first five quarters. The company explained, “The profit from the weak yen and the increase in the number of sales made up for the loss caused by the surge in raw materials.”
However, Toyota Motor did not revise its previous forecast despite the increase in operating profit. Toyota had previously predicted that its operating profit for fiscal 2022 (April 2022 to March 2023) would fall 20% year-on-year to only 2.4 trillion yen. The number of production plans for Toyota and Lexus has been lowered to 9.2 million units, down 100,000 units from previous estimates, considering the supply shortage of semiconductors.
Experts analyzed that it is noteworthy that Toyota Motor Corporation made a surplus in operating profit in the third quarter of fiscal year by leveraging the weak yen without reflecting inflation in vehicle prices.
“The yen’s rise will hurt the next quarter, but inflation will find a balance and vehicle production will recover,” Nakanishi Koioji, an analyst at the auto industry, told Nihon Keizai. “The key is how stable the U.S. market is.”
However, he said Toyota Motor Corporation still has a lot of tasks to solve in terms of management, such as replacing management and switching to electric vehicles.