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Toyota Q1 profit drops 28%

Toyota Q1 profit drops 28%

James Martinez May 8th, 2008 James Martinez By James Martinez Author May 8th, 2008
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December 31st, 1969 It appears even Toyota, the industry’s top-selling carmaker by volume, couldn't avoid the combined profit gouging effects of an economic downturn, rising material costs and a slowing global economy that have negatively affected most major carmakers. We’ve already seen GM post a $3.3 billion loss this quarter and a number of other carmakers including Daimler, BMW, Honda and Mazda all report double-digit profit slumps, and today Toyota has announced that its January-March quarter sank 28% on last year’s result. Toyota’s profit for the quarter fell to ¥316.8 billion ($3.05 billion) from ¥440.1 billion a year ago - the first on-year decline in profit since the April-June quarter of 2005, reports Automotive News. Executives have blamed the strengthening yen and declining sales of SUVs and pickups in North America for the poor result, and have already responded by raising car prices. For the fiscal year ended March 31, Toyota sold 8.91 million vehicles worldwide – 4.5% up on levels one year ago. Despite the poor market conditions, executives are expecting sales to rise this year by 1.6% to about 9.06 vehicles. Things are expected to get worse, however, as Toyota is still forecasting a 27% profit slump for the year. "We are facing a severe business environment," Toyota President Katsuaki Watanabe warned reporters.
Toyota Q1 profit drops 28%

Toyota Q1 profit drops 28%

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It appears even Toyota, the industry’s top-selling carmaker by volume, couldn't avoid the combined profit gouging effects of an economic downturn, rising material costs and a slowing global economy that have negatively affected most major carmakers. We’ve already seen GM post a $3.3 billion loss this quarter and a number of other carmakers including Daimler, BMW, Honda and Mazda all report double-digit profit slumps, and today Toyota has announced that its January-March quarter sank 28% on last year’s result.

Toyota’s profit for the quarter fell to ¥316.8 billion ($3.05 billion) from ¥440.1 billion a year ago - the first on-year decline in profit since the April-June quarter of 2005, reports Automotive News. Executives have blamed the strengthening yen and declining sales of SUVs and pickups in North America for the poor result, and have already responded by raising car prices.

For the fiscal year ended March 31, Toyota sold 8.91 million vehicles worldwide – 4.5% up on levels one year ago. Despite the poor market conditions, executives are expecting sales to rise this year by 1.6% to about 9.06 vehicles.

Things are expected to get worse, however, as Toyota is still forecasting a 27% profit slump for the year. "We are facing a severe business environment," Toyota President Katsuaki Watanabe warned reporters.

Tags: Industry

Posted in: Toyota, News


Comments (3 total)

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  1. By chris #1, Posted: 5/8/2008

    awww... toyota didnt make AS MUCH money. maybe thats cause they've been throwing incentives on their cars for the first time ever. and doing it a lot too. blame it on truck sales being down? they're selling more trucks now than ever. the problem is they aren't making money on them cause they're putting more incentives on their trucks than anyone but dodge.

    what a bunch of crap.

    but yeah, say what you want about foreign brands building cars domestically, but the truth remains, the money is leaving the country. if it wasnt, they'd still be making a tonne of money. thats evident from the exchange rates.....

  2. By Francis #2, Posted: 5/8/2008

    not surprising, their quality has become crap in the last 2 years, thats the sacrifice you make to become the biggest car company.

  3. By HECTOR #3, Posted: 5/8/2008

    I am extremely proud to take a little bit of credit for Toyota's declining profits. If they turned off those &%$*@ DRLs I might consider buying one over a Nissan.

    Naaah, not really. Toyota cars piss me off every day. I'm more likely to buy a Yugo than a Toyota.

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