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Automotive
Toyota’s Net Profit Falls Amid Record Sales With Rising Costs
(CTN NEWS) – TOKYO – Toyota Motor Corp. reported on Thursday that despite record-breaking sales, its net profit for the nine months ending in December dropped 18.0 percent to 1.90 trillion yen ($14.5 billion) from the same period the previous year due to increased material prices.
Sales over the nine months increased 18.0 percent to a new high of 27.46 trillion yen, helped by a rise in vehicle sales in North America and Asia and a weaker yen, according to the Japanese automaker.
According to the company, increasing costs for commodities like steel, aluminum, and oil caused operating profits to decline 17.1% to 2.10 trillion yen.
Profitability was also affected by increases in other costs and losses, although the rapid devaluation of the yen—which hit a 32-year low versus the dollar in October—boosted operational earnings elsewhere and lessened the impact, according to the statement.
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In contrast to its earlier prediction of 135 yen, the company anticipates that the yen will trade at 134 yen per dollar for the remainder of the current fiscal year through March.
According to Toyota, the automaker’s operating profits increase by 45 billion yen for every 1 yen that falls versus the dollar.
Although profits in Japan and Asia increased during the quarter, its North American division was severely impacted by growing prices, incurring operational losses in the three months through December.
According to the company, price increases in North America have not offset growing material costs.
READ MORE: Toyota Crowned Best-Selling Automaker In 2022 For 3rd Straight Year
Reuters Graphics
Due to challenges finding enough semiconductors, Toyota revised its forecast for global car production for the year ending in March from 9.2 million to 9.1 million units.
The manufacturer did not adjust its global vehicle sales objective or annual earnings outlook.
It anticipates a net profit of 2.36 trillion yen for the fiscal year that ends in March, a decrease of 17.2% from the prior year. To reach 36 trillion yen in sales, a 14.7% increase is anticipated.
The automobile group anticipates selling 10.4 million units for the fiscal year and its subsidiaries Daihatsu Motor Co. and Hino Motors Ltd.
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