Toyota Motor (TM) lifted its earnings guidance for the ongoing year on a weaker yen and expectations for higher sales volume a week after losing its position as the top global automaker to Volkswagen (VLKAY) .
Japan's largest company by market value raised its net profit outlook for the year ending March to ¥1.7 trillion ($15.1 billion) from ¥1.55 trillion on sales of ¥26.5 trillion, which were upgraded from ¥26.0 trillion. The automaker also raised its operating profit outlook to ¥1.85 trillion from ¥1.7 trillion. The company now assumes an ¥107 to the dollar and ¥118 to the euro on an annual average.
Still, the maker of the Prius and Corolla models would be facing year-on-year declines at all levels, down 6.7% for sales, down 35.2% at the operating level and down 26.5% at the net level if its forecasts prove correct.
The upgrade comes amid a tense time for the automaker, which has been threatened by U.S. President Donald Trump with high border taxes if it went ahead with its plans to build a Mexican plant to sell its Corolla model in the U.S. Toyota has since announced a plan for additional investments into its Indiana plant.
The revision was announced alongside third quarter results. In the nine months through December, Toyota booked net profit of ¥1.4 trillion on sales of ¥20 trillion, each down 24.0% and 6.0% from the same period a year ago.
Sales dropped in all regions, with the biggest decline seen in North America, while operating profit plunged nearly 50% for the domestic business. The automaker's efforts to cut costs were not enough to offset the drags from the currency market.
