Toyota said yesterday its annual profit accelerated 19% to a record $18.1bn as the world’s biggest automaker capitalised on a weak yen and strong demand in North America, despite a damaging string of recalls.
The company beat earlier forecasts with its ¥2.17tn net profit ($18.1bn) in the fiscal year to March—bigger than the combined 2014 profit of Volkswagen and General Motors.
Revenues at the Corolla and Prius hybrid maker rose 6% to ¥27.23tn. Despite weakness in Asia and industry concerns about a slowdown in major market China, Toyota also said it was on track for a bigger ¥2.25tn net profit in the current business year.
Toyota’s latest operating profit rose 20%—largely owing to cost cuts and a sharp decline in the yen, which inflates the value of exporters’ repatriated profits—even as sales edged lower to 8.97mn units.
Including the Hino and Daihatsu brands, Toyota moved a slightly higher 10.16mn units.
Sales to North America and Europe rose, while they turned down in Asia and specifically in Japan, where consumer spending dived after the government hiked sales taxes last year.
Chinese sales rose 7.4% in the latest period, however, although GM and Volkswagen still outsell Toyota in the world’s biggest auto market. “We are expecting the North American market to continue its strong performance, but we see sales volume falling in Asia where the environment is becoming increasingly tough, as well as emerging markets such as Russia and the Middle East,” Executive Vice President Nobuyori Kodaira told a press briefing in Tokyo Friday.
Toyota said it is planning a ¥300bn share buyback after an investor meeting in June. But president Akio Toyoda added that his family company still needed to be “reborn” to cope with an “uncertain” global auto market. Toyota has been focusing on squeezing out productivity gains and better using existing plants—it put on hold building new factories for several years.