Toyota sees lower growth in operating profit on weak sales

TOKYO: Toyota Motor forecast lower growth in operating profit for the current year on an expected drop in revenue and weaker vehicle sales in Japan and North America, underscoring the hard task ahead as it gears up to face a rapidly shifting industry.

Japan’s largest carmaker said it expects profit to rise 3.3 per cent to 2.55 trillion yen (RM96.3 billion) in the year to March 2020, lower than the 2.61 trillion yen average of 23 analyst estimates compiled by Refinitiv and compared with last year’s 20 per cent jump.

While it forecast global group retail sales at a record 10.74 million vehicles for the current year, compared with 10.6 million in the previous year, Japan sales were down 1.2 per cent and North American sales lost 1.6 per cent.

Net revenue was forecast to slip to 30 trillion yen from 30.2 trillion yen.

Toyota is facing stiff competition as ride-sharing technology and the race to develop self-driving cars has caused rapid disruption to the automotive industry.

“We still weren’t able to improve our costs enough last year,” said chief financial officer Koji Kobayashi.

Toyota has recently outlined plans to offer carmakers and auto suppliers royalty-free access to nearly 24,000 electrified vehicle technologies patented by it.

In the last 20 years, Toyota has managed to dominate the global market for hybrid cars by constantly improving and lowering the cost of the technology it pioneered in its Prius model — and keeping this expertise a closely guarded secret.

Now, it says it aims to use partnerships to cut by as much as half the outlays for expanded electric and hybrid vehicle components production in the United States, China and Japan.