TOKYO: Toyota Motor Corp said on Wednesday that its net profit fell 14% in fiscal 2022 from the previous year to 2.45 trillion yen ($18 billion), the first decline in four years, due to rising material costs.
Operating profit for the year ended March 31 slid 9% to 2.73 trillion yen, although the Japanese carmaker posted record revenue of 37.15 trillion yen on robust vehicle sales and a weaker yen that inflates results when funds from overseas sales are repatriated.
The company recently had its first leadership change in 14 years with Koji Sato, a former Lexus division head, replacing Akio Toyoda as president at the world’s biggest auto seller on April 1 as it accelerates its efforts in electric vehicle development.
“We realised there was still room for improvement despite the challenging circumstances,” Sato said at a press conference following the release of earnings. “We will boost our resistance to fluctuating factors such as material costs and foreign exchange.”
Rising costs for steel and aluminium pushed down Toyota’s operating profit by 1.55 trillion yen, although the positive effect from the falling yen and brisk sales in Japan and other Asian markets helped mitigate some of the impact, the automaker said.
For the current business year through next March, Toyota expects net profit to increase 5.2% to 2.58 trillion yen. Operating profit is projected to rise 10.1% to a record 3 trillion yen on sales of a record 38 trillion yen, up 2.3%.
The company said it aims to produce a record 10.1 million cars for the Toyota and Lexus brands, up from 9.13 million a year before, as it recovers from a semiconductor shortage that impacted its production last fiscal year.
The auto giant, together with its subsidiaries Daihatsu Motor Co and Hino Motors Ltd, plans to sell 11.38 million vehicles worldwide in fiscal 2023, up 7.8% from the previous year.
Toyota also said it had restarted shipments of Daihatsu-made vehicles sold under the Toyota brand to Malaysia, Mexico and Ecuador after they were halted following revelations about the subsidiary’s improper testing of products.
A review by a third-party organisation proved the vehicles are all safe to drive, Toyota said, adding it was also in talks with authorities in Thailand and countries in the Middle East to restart shipments to them.
Daihatsu said last month that door parts of four models for overseas markets were “improperly modified” in side collision tests, with the number of affected vehicles amounting to 88,000 units, many of which were sold in Thailand and Malaysia.