Japan's No. 1 automaker Toyota reports booming profits

Monday, May 13th 2002, 12:00 am
By: News On 6

TOKYO (AP) _ Japan's top automaker Toyota Motor Corp. saw its net profits surge more than 30 percent for the latest fiscal year on hefty sales in both Japan and the United States.

Toyota reported earnings of 615.8 billion yen ($4.8 billion) Monday for the fiscal year ended in March, up from 471 billion yen a year ago. Sales totaled 15 trillion yen ($118 billion) _ the best ever for the company _ up 12 percent from 13 trillion yen the previous year.

Toyota is dominating Japanese auto sales with hit models such as the Corolla and Vitz, controlling 42 percent of the market, up from 40 percent the previous year. It is also succeeding in the United States, where it gained more than 10 percent market share for the first time, Toyota said. Toyota sold 1.78 million vehicles in North America, up from 1.73 million a year ago.

``Overall it was a good performance,'' Toyota Executive Vice President Ryuji Araki told reporters in a news conference at a Tokyo hotel. ``We hope to do even better this fiscal year.''

One factor contributing to the healthy earnings for the latest fiscal year was the favorable exchange rate, which added 410 billion yen ($3.2 billion) to earnings, Toyota said. A weaker yen tends to help exporters like Toyota by boosting the value of overseas earnings. Cost reduction efforts saved an additional 260 billion yen ($2 billion).

In fiscal 2001, Toyota sold 5.78 million vehicles, up from 5.52 million the previous year. Sales in Japan rose nearly 5 percent to 10.5 trillion yen ($82 billion), while sales in North America rose 17.5 percent to 5.8 trillion yen ($46 billion).

Although Toyota has yet to become profitable in Europe, sales were up in that region as well, improving 52 percent to 1.6 trillion yen ($12.6 billion).

Araki said Toyota needs ``a bit more time'' to boost local production and purchasing, and to add new models, before its European business turns a profit.

Toyota, which has a partnership with French carmaker PSA Peugeot Citroen to jointly develop and produce small cars for the European market, plans to start production at a plant in the Czech Republic in 2005. Toyota already makes cars in England and France.

The automaker, based in Toyota city, central Japan, also entered Formula One racing this year _ a move aimed at strengthening its image among European car fans.

Toyota has an ambitious global plan to boost sales in other key markets such as China, where it will start producing cars under the Toyota brand for the first time later this year in a joint venture with a Chinese partner.

Toyota also plans to woo younger drivers in North America with its Scion brand, which will feature relatively affordable but fun-looking vehicles. They are set to start arriving in showrooms in June 2003.

Toyota said it produced 1.37 million cars overseas in fiscal 2001, up nearly 17 percent from 1.18 million the previous year. Production in Japan fell nearly 2 percent to 4.03 million vehicles from 4.1 million.