A stronger yen and the nation’s stagnant economy continued to plague all Japan’s five major automakers except Toyota Motor Corp. in fiscal 1999, which ended March 31, according to their annual earnings reports released by Friday.
Mazda Motor Corp. reported Friday that its consolidated pretax profits hit 6.1 billion yen in fiscal 1999, down 86.8 percent from the previous year, due mainly to the yen’s appreciation. Company officials said that group sales were 2.16 trillion yen, up 5.1 percent from a year earlier.
Consolidated operating profits also dropped 59.8 percent to 25.1 billion yen and consolidated net profits fell 32.4 percent to 26.2 billion yen. On an unconsolidated basis, Mazda’s sales increased 0.8 percent to 1.47 trillion yen but pretax profits dropped 84.5 percent to 7.7 billion yen.
According to the automakers’ earnings reports, industry leader Toyota increased its consolidated profits, despite the yen’s appreciation, posting 797 billion yen in consolidated pretax profits, up 3.3 percent from the previous year.
The company attributed the increase to reduction of operating and supplies costs and hit products, including the Vitz compact car.
Nissan, which plunged into the red with consolidated pretax losses of 1.6 billion yen, fell to third place among the five in terms of group sales, behind Toyota and Honda Motor Co.
“I don’t like it (falling from second to third place), but it’s the reality. Our objective is not size, but profitability,” Nissan Chief Operating Officer Carlos Ghosn told a recent press conference. Nissan’s group sales were 5.98 trillion yen, compared with Honda’s 6.1 trillion yen.
Although Honda is building up its position as the second largest automaker in Japan, it also suffered from the stronger yen. Honda’s consolidated pretax profits dropped 20.1 percent to 416 billion yen.
Mitsubishi Motors Corp., the nation’s No. 4 carmaker, recorded consolidated pretax losses of 3.76 billion yen for the third consecutive year, compared with 4.18 billion yen in fiscal 1998.
A sharp decline in truck sales amid the protracted slow economy hit Mitsubishi hard, company officials said.
Although Japan’s economy is gradually recovering, the five carmakers believe the yen’s appreciation will continue to pull down their earnings for fiscal 2000, the companies said.