Toyota Motor Corp remains unhinged despite the ongoing global chip shortage. Operating profit for Toyota is reportedly almost doubled its fourth-quarter operating profit.
On Wednesday, Toyota reported a 689.8 billion yen operating profit. This figure beats the estimate from 10 analysts compiled by Refinitiv at 641.5 billion yen.
Toyota also forecasts a 14% incline in profit to 2.50 trillion yen for the fiscal year that started on April 1. This estimation goes against the 8.4% profit loss for the year that just ended, Reuters quotes.
Toyota gains confidence from the expectedly growing demand in the United States, its biggest market. Recovery in demand could further boost overall sales to 6.4% higher, Toyota expects. This translates into 10.55 million vehicles for the year.
Following the news, shares for Toyota grew 2.1% higher. Quite a visible contrast from the 10% tumble in Nissan.
How Toyota maintained operating profit
Toyota has been stockpiling its semiconductors. The automaker’s semiconductors supply are currently enough for engine maintenance, car safety, and even entertainment systems. Thus, it is very unlikely the company might face any major short term impact from the global chip shortage.
CFO Kenta Kon, as quoted from Reuters, revealed that the Fukushima earthquake in 2011 helped Toyota to improve its inventory management. After the incident, Toyota kept on making efforts to improve its supply-chain management to mitigate the impact of similar occurrences.
“We are now able to make assessments of alternative products in a speedy matter. That is one of the factors of us being able to mitigate the impact of semiconductor supply shortages,” Kon told a media briefing.
Still, the Toyota executive warned that the shortage situation was still fluid. Hence, there is still a possibility that Toyota could face the same shortage in the second half of the fiscal year.
Read also: Chip Shortage, Japan Automakers Alert Profit Drop
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