Toyota Motor Corp. has drastically raised its consolidated earnings forecast for the fiscal year ending in March 2021.
The company once predicted that the impact of the novel coronavirus would be greater than the global financial crisis triggered by the collapse of U.S. investment bank Lehman Brothers. However, Toyota's earnings were ultimately boosted by a steady lineup of new cars at home and abroad.
Toyota's upward revision is likely to be good news, as the automobile industry is expected to have a large ripple effect on the Japanese economy.
--Already topped last year
"There were six months of hard work. Toyota is getting stronger bit by bit," company President Akio Toyoda said at an online news conference about the company's efforts over the past half-year.
In May, the company expected that operating profit for the year ending in March 2021 would fall 80% to 500 billion yen. But in the six months from April to September alone, the company's operating profit was 519.9 billion yen, higher than the forecast. The company raised its full-year operating profit estimate to 1.3 trillion yen, or 2.6 times the previous forecast.
New car sales in major markets have rebounded and exceeded last year's figure.
In September, new car sales in China were up 25.3% from a year earlier, thanks mainly to brisk sales of luxury cars such as the Lexus.
In the United States, sales rose 16.2%. It was the first time in seven months for sales to top last year's. Sales were up of SUVs, which the company has been focusing on for a long time.
In Europe, sales climbed 15.1%, up for three consecutive months.
In addition to its new Yaris, Toyota has launched new models such as the RAV4 and the Harrier. "Sales reps' work on the online sales process," according to President Toyoda, was also effective. Sales recovered above the market average.
--Kaizen improvements
Even during the coronavirus pandemic, when Toyota temporarily halted production at its domestic plants, the company continued to work on "kaizen" efforts to improve production efficiency. From April to September, the company reduced costs by 50 billion yen by improving the efficiency of sales and production sites and 115 billion yen by saving office supplies.
This year, Toyoda attended the press conference on the company's interim financial results for the first time since he became president in 2009. "I wanted to say thank you to the people [such as distributors, suppliers] who are working hard, " he said.
In the United States and Europe, the novel coronavirus is spreading again. Depending on the outcome of the U.S. presidential election, automakers may be forced to comply with environmental regulations.
"The effects of lockdowns and the spread of the coronavirus should be closely observed. The situation is unpredictable," Toyota operating officer Kenta Kon said at the press conference.
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