(CTN News) – In the United States, Toyota Motor recalled 1.85 million RAV4 sport utility vehicles over fire risks associated with replacement batteries.
Vehicles from the 2013-2018 model year are included in the recall. There are some replacement 12-volt batteries with smaller top dimensions, and if a clamp isn’t tightened correctly, the battery could move during forceful turns and potentially short circuit, increasing fire risks.
By late December, Toyota said dealers will replace the battery hold-down clamp, battery tray, and positive terminal cover with improved parts.
A HIKE IN PROFITS
The slumping yen boosted Toyota’s second-quarter profit and sharply raised its full-year forecast on Wednesday.
Its operating profit rose 155.6% from a year earlier to 1.44 trillion yen ($9.5 billion) in the three months to September.
Over the six months to September, Toyota sold more cars globally, including the United States, Asia, and its home market.
Toyota is committed to improving EV driving range and cutting costs after years of criticism for its slow adoption of battery electric vehicles.
Due to increased financing costs in the United States, it is now benefiting from both market optimism about its strategy and renewed interest in its gasoline-electric hybrid vehicles.
Despite their lower cost, Toyota’s electrified cars often rely heavily on hybrids. Hybrid sales increased 41% to 888,000 vehicles in the quarter to September.
Analysts have noted, however, that faces many challenges, particularly in China, where domestic EVs and the shift to battery-powered cars are hurting Nissan Motor and Honda Motor.
In a briefing following the results, Chief Financial Officer Yoichi Miyazaki said China is experiencing “very severe price competition”.
EVs with battery packs were the most competitive in terms of price, he said.
EV demand is also fueling a battle for Toyota in Southeast Asian markets, such as Thailand.
The strong results of this quarter should help Toyota’s growth plans. In North Carolina, battery production will increase by $8 billion for hybrids, plug-in hybrids, and full batteries.
It increased its profit forecast for the full year from 3 trillion to 4.5 trillion yen, largely due to the favorable effects of foreign exchange rates. As a result of a weaker yen, Toyota expects its full-year profit to be revised downward by 1.18 trillion yen.
In comparison with analysts’ average forecast of 4.0 trillion yen, the new projection is higher.
Following Japan’s renewed threats of currency intervention, the yen hit a one-year low of 151.74 per dollar on Tuesday.
For the 2023/24 financial year, Toyota assumed an average rate of 141 yen per dollar instead of 125 yen.
In addition, the company announced a 100 billion yen share buyback. Following the release of the results on Wednesday, Toyota shares rose 4.7%, helping Japan’s benchmark Nikkei index rise 2.4%.