Toyota Motor Corp. raised its fiscal year profit forecast Wednesday as surging overseas sales of SUVs and the carmaker’s production base in Japan make it one of the biggest beneficiaries of a weaker yen.
Net income for the 12 months ending in March may climb to a record ¥2.13 trillion, the company said. Its previous forecast was for a record profit of ¥2 trillion.
President Akio Toyoda is extending his company’s leadership in profitability among automakers even as Volkswagen AG closes in on the global vehicle sales crown.
A weak yen is raising the value of Toyota’s record sport utility vehicle deliveries in the U.S. and giving the company a windfall for building and shipping more autos from Japan than the next three biggest auto exporters combined.
“The yen’s so much weaker than two years ago, they are having the time of their life,” Masakazu Takeda, a Tokyo-based portfolio manager for SPARX Asset Management Co., said before Toyota released its results. “They benefit tremendously.”
Net income rose to ¥600 billion for the quarter ended December, Toyota said in a statement. Profit exceeded the ¥549.2 billion average of 12 analysts’ estimates compiled by Bloomberg.
Toyoda, 58, has abstained from building car factories until at least next year, opting to instead push for productivity gains and expansion of existing operations. The company last opened a new plant in 2012.
While the strategy has made Toyota more efficient, it also helped let Volkswagen pull within about 90,000 vehicles of the Japanese carmaker’s total sales last year.
Toyota has managed to earn more than Volkswagen and other automakers thanks in part to a two-year campaign by Prime Minister Shinzo Abe to invigorate the economy by introducing stimulus measures.
Rounds of monetary easing in April 2013 and last October by Abe’s hand-picked Bank of Japan governor, Haruhiko Kuroda, contributed to the yen weakening about 22 percent against the dollar during the past two years, buoying export earnings.
Last year, Toyota shipped 1.89 million passenger cars, trucks and buses from Japan, according to a statement on its website. While down 5.8 percent from a year earlier, the total was more than Mazda Motor Corp., Fuji Heavy Industries Ltd. and Nissan Motor Co. combined.