Toyota Motor on Wednesday posted a 21% fall in third-quarter operating profit to 784.4 billion yen ($6.8 billion) as chip shortages crimped vehicle output.
The company lowered its production target for the year to March 31 to 8.5 million vehicles from 9 million.
The result for the three months to December 31 was higher than an average forecast of 716.8 billion yen based on the estimates from nine analysts, Refinitiv data show.
The Japanese automotive giant, which kept its crown as the world’s top-selling carmaker in 2021, left its annual net profit forecast of 2.8 trillion yen unchanged. “The operating income forecast remains the same as the previous forecast,” Toyota said.
The carmaker said it was taking into account the increase in operating income due to the revision of foreign exchange assumptions reflecting the weaker yen and the decrease in operating income due to the reduction in vehicle sales.
“During the nine months from April to December 2021, despite negative factors such as constraints on supply due to the shortage of semiconductors and the spread of Covid-19, as well as the sharp rise in raw material costs, we achieved higher sales and profits as a result of promoting initiatives supported by sales,” the company said.
“We sincerely apologise for the inconvenience caused to our customers due to the series of production volume reductions since last summer,” Toyota said in a statement accompanying its financial results.
“We are working to restore full production as soon as possible.”
Making Big Bets
Toyota is making big bets on hybrids and electric vehicles after dethroning General Motors as the biggest-selling automaker in the US.
“What we are still seeing today is that many consumers that are in the full battery electric market still need a second car to fit family needs,” Bob Carter, Toyota’s North American sales chief, told CNBC on Tuesday.
“So the demand for hybrid has been strong and we expect it to continue to grow as the entire industry transitions over to electrification later this decade.”
Carter expects Toyota’s hybrids to make up over 30% of vehicle volumes compared to around 26% last year — provided that supply chain disruptions clear up in the second quarter of this year.
His comments on CNBC’s “Squawk Box” came after Toyota beat GM last year as the best-selling automaker in the US for the first time. GM has held the position since 1931.
Carter said that while he is unsure the Japanese automaker will defend its title, he expects Toyota to continue its trajectory.
- George Russell, with AFP and Reuters
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