Toyota expects Japan crisis to cut 35pc from profit
Toyota says it expects operating profit this business year to fall 35 per cent to 300bn yen (£2.2bn) after Japan’s biggest earthquake on record severely disrupted car production and slashed sales.
The annual guidance compares with a consensus of a 434bn yen operating profit based on the average of 23 forecasts by analysts. Operating profit in the year to March 2011 was 468.3bn yen.
The 9.0 magnitude earthquake that rocked northeastern Japan on March 11 forced Toyota and other Japanese automakers to cut output at home and abroad as they struggled to secure vital parts. The ensuing nuclear disaster and power shortages have compounded problems.
The world’s biggest automaker said on May 11 that the earthquake has contributed to a 52 per cent fall in profit during the January-March quarter, but the company delayed unveiling the annual forecasts as it weighed the impact of the disaster on consumption and its supply chain.
The massive disruption to production will likely mean Toyota will fall behind General Motors and possibly Volkswagen to rank third in global vehicle sales this year.
The world’s biggest automaker cut its group-based global vehicle sales forecast for the 2011/12 business year to 7.24m units from 7.3m. The figures include sales at truck maker Hino Motors and compact car maker Daihatsu.
Toyota now expects the dollar to average 82 yen in the current financial year to next March 31, against an averaged currency rate of a 86 yen-per-dollar last year
Toyota’s shares have fallen 7.5 per cent since the disaster, underperforming the benchmark Nikkei 225 average which lost 6.5 per cent.
Its shares rose 0.9 per cent to close at 3,300 yesterday before the company released the profit forecast.