Business

Toyota net profit up 29% on cost cuts, global sales

Toyota Motor Corp. said Tuesday its group net profit in the April-June quarter rose 28.8 percent from a year earlier to 286.6 billion yen due to robust overseas sales and rigorous cost-reduction efforts.

The result prompted the nation’s top automaker to lift its global sales forecast for the full fiscal year by 2.5 percent from May to 7.2 million units.

Revenue during the reporting quarter grew 10.2 percent to 4.51 trillion yen, while operating profit surged 31.6 percent to 448.6 billion yen.

Toyota said the yen’s strengthening against the dollar sucked some 70 billion yen from its operating profit. But marketing efforts contributed 170 billion yen, while cost cuts generated 40 billion yen, more than offsetting the negative impact from the strong yen.

“Our efforts to introduce vehicles that meet customer needs as well as the development of production bases and sales channels to correspond to those needs are beginning to bear fruit in all regions,” Toyota Director Takeshi Suzuki told reporters in Tokyo.

In terms of sales volume, Toyota’s global total in the quarter, including those sold by subsidiaries Hino Motors Ltd. and Daihatsu Motor Co., rose 12.4 percent to 1.79 million units.

The firm’s domestic sales meanwhile declined 0.9 percent to 538,000 vehicles. But Toyota said the market share of Toyota-brand vehicles was 46.1 percent, the highest for quarterly results, led by the new Prius hybrid car, the remodeled Crown luxury sedan and the Sienta compact.

In North America, Toyota sold 572,000 vehicles, up 12.4 percent, with the Sienna minivan enjoying brisk sales. Toyota’s market share in the United States marked a record 12 percent for quarterly results, Suzuki said.

In Europe, sales rose 5.6 percent to 248,000 vehicles, led by strong demand for locally produced vehicles, including the new Corolla Verso minivan.

Sales in non-Japan Asia, Africa and Latin America grew 40.9 percent to 434,000 units due to brisk sales of the Vios sedan.

Suzuki said demand in Japan and the U.S. for its Prius hybrid cars is so strong that it is planning to increase monthly production to 15,000 units from 10,000 at present, starting in the first half of next year.

New factory in India

BANGALORE, India (Kyodo) Toyota Motor Corp. opened a factory Tuesday to make manual transmissions and propeller shafts for shipment to the global market.

The factory in Bangalore will be run by Toyota Kirloskar Auto Parts, a joint venture with Kirloskar Systems Ltd., an arm of India’s Kirloskar group, according to the automaker.

The inauguration ceremony was attended by Indian Finance Minister Palaniappan Chidambaram.

Toyota put up 64 percent of the investment for the factory, with group ally Toyota Industries Corp. putting up 26 percent. The remainder was shouldered by Kirloskar.

The factory will manufacture 160,000 manual transmissions and 50,000 propeller shafts a year with a 700-person workforce.

The components will be exported to Toyota’s automobile factories mainly in Latin America, Southeast Asia and South Africa.

Chidambaram told the ceremony he is convinced the factory will prosper as a key entity tasked with exporting auto parts to seven of Toyota’s production bases globally.

Toyota has been assembling passenger cars bound for the Indian market at a plant in Bangalore since 1997 by teaming up with the Kirloskar group.

In 2003, the Bangalore plant had a total output of 40,000 cars.

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