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Toyota's first quarter profit rises 10% | Toyota's first quarter profit rises 10% |
(about 3 hours later) | |
Japanese carmaker Toyota has reported a 10% increase in profits for the first quarter of its fiscal year, helped by the weak yen and cost cuts. | Japanese carmaker Toyota has reported a 10% increase in profits for the first quarter of its fiscal year, helped by the weak yen and cost cuts. |
For the period from April to June, net income rose to 646.3bn yen (£3.34bn; $5.2bn) from 587.7bn yen a year ago. | |
The company also raised its full-year sales forecast to 8.95 million units from 8.9 million. | |
Last week, it emerged that Toyota was overtaken by VW as the world's largest carmaker in the first half of the year. | |
The relative weakness in the Japanese yen has helped to make Toyota more competitive abroad while inflating the value of its repatriated earnings from overseas. | |
However, Toyota - along with other carmakers - has also suffered from problems with airbags, made by supplier Takata, that were fitted in its cars. | |
Toyota and other Japanese car makers have had to recall millions of cars worldwide over the faulty airbags. | |
US recovery | US recovery |
Globally, Toyota sold 2.1 million vehicles during the quarter, about 127,000 fewer vehicles from a year earlier. | |
In a statement, Toyota managing officer Tetsuya Otake said: "Favourable foreign exchange rates and cost reduction efforts were main positive factors, while decreasing vehicle sales and increased expenses to support initiatives for enhancing competitiveness were negative factors." | In a statement, Toyota managing officer Tetsuya Otake said: "Favourable foreign exchange rates and cost reduction efforts were main positive factors, while decreasing vehicle sales and increased expenses to support initiatives for enhancing competitiveness were negative factors." |
Toyota's sales in Japan were slightly lower, but sales in North America rose while Europe remained almost flat. | Toyota's sales in Japan were slightly lower, but sales in North America rose while Europe remained almost flat. |
On the back of a weaker yen, Japanese car exports have benefitted from the US economy's recovery in the past months. | On the back of a weaker yen, Japanese car exports have benefitted from the US economy's recovery in the past months. |
In Europe, economic conditions have improved overall despite the recent turmoil over the Greek debt crisis. | |
'Two-pronged approach' | 'Two-pronged approach' |
Sales in Asia, South America Africa and the Middle East saw the biggest falls, with emerging markets affected by a slowdown in economic growth. | Sales in Asia, South America Africa and the Middle East saw the biggest falls, with emerging markets affected by a slowdown in economic growth. |
In China, the carmaker has seen increased competition from local carmakers, Vivek Vaidya, an auto analyst with consultancy Frost & Sullivan, told the BBC. | |
"China is always the market where you will have significant competition from the lower end, from cheaper alternatives," he said. | "China is always the market where you will have significant competition from the lower end, from cheaper alternatives," he said. |
"So Toyota is using a two-pronged approach - their technology and their quality - to try and increase their market share in China in the future." | "So Toyota is using a two-pronged approach - their technology and their quality - to try and increase their market share in China in the future." |
Toyota also announced a reorganisation of its Chinese operations, announcing a joint venture plant in Tianjin. | |
The new line is to be operational by 2018 and is to boost capacity by 100,000 vehicles per year. |