Toyota lifts profit forecast by 54%

Toyota has lifted its full-year earnings forecast by 54 per cent and is not anticipating any imminent cuts to production because of a global chip shortage.

It predicts an operating profit of ¥2 trillion (NZ$26.5 billion) for the financial year ending March 31, up from ¥1.3tn set in November.

The Japanese marque’s outlook has been bolstered by a ¥988b profit in the October-December quarter, which was way above predictions for ¥571b.

Toyota also says it has an up to four-month stockpile of chips and has increased its output for the financial year.

It expects to sell 9.73 million vehicles this year, up 3.3 per cent from a previous forecast of 9.42m but down from the previous year’s 10.46m.

Kenta Kon, pictured, Toyota’s chief financial officer, warns the company may have to rethink manufacturing levels if the lack of semiconductors worldwide continues through the middle of 2021.

“For the near term, we do not see any decrease in production volume due to the chip shortage, but we do see risks of a chip shortage,” he says.

He explains Toyota has not suffered the same impact from the problem as other carmakers because it has been regularly providing its short-term and long-term production volume plans to suppliers.

Rival companies have had to reduce the number of cars they are making because of the falling availability of semiconductors. Nissan and Honda are slashing production by a combined 250,000 vehicles this financial year.

Honda has cut its sales target by 100,000 vehicles, or 2.2 per cent, to 4.5m cars, while Nissan has lowered its target by 150,000 units, or 3.6 per cent, to 4.015m.