In a remarkable financial turnaround, Japanese automaker Toyota Motor Corp (NYSE:TM) posted a nearly threefold increase in its profit for the July-September quarter compared to the previous year. This surge in profits was driven by growing vehicle sales worldwide and the advantage of a weak Japanese yen that boosted the company’s overseas earnings.
Toyota Motor Corp. announced quarterly profits of 1.28 trillion yen (approximately $8.5 billion), a substantial increase from 434 billion yen in the same period the previous year. Furthermore, quarterly sales experienced a substantial 24% rise, reaching 11.43 trillion yen (about $75.7 billion) from 9.22 trillion yen.
The weakening yen proved advantageous for Toyota, a key player among Japan’s major exporters, as it increased the value of its overseas earnings when converted into yen. During the latest quarter, the U.S. dollar was trading at around 145 Japanese yen, up from 138 yen, and it has recently been trading above 150 yen.
Toyota, known for manufacturing popular models like the Camry sedan, Prius hybrid, and luxury Lexus vehicles, has also revised its profit forecast for the fiscal year ending in March 2024. The new projection stands at 3.95 trillion yen (approximately $26 billion), an upgrade from the previous estimate of 2.5 trillion yen. If this forecast comes to fruition, it will set a record high for Toyota.
Toyota remains optimistic about the growth of its vehicle sales in major regions across the globe. In the July-September period, the company witnessed an increase in vehicle sales in the U.S., Europe, Japan, and the rest of Asia, with the global total surpassing 2.4 million vehicles, up from 2.1 million in the previous year. Despite various challenges in the automotive industry, Toyota has maintained its full fiscal year global vehicle sales projection at 11.38 million units.
Toyota has openly acknowledged its lag in the electric vehicle (EV) market compared to leading competitors like U.S. EV manufacturer Tesla and China’s BYD. To bridge this gap, Toyota has been actively showcasing concepts that highlight its commitment to catching up in the EV sector. Additionally, the company recently disclosed an $8 billion investment in its hybrid and electric vehicle battery factory in North Carolina, significantly increasing its initial investments.
This expansion is expected to create over 3,000 additional jobs, resulting in a total of more than 5,000 jobs when the facility commences operations near Greensboro in 2025. Toyota’s North American lithium-ion battery plant is slated to become a crucial supplier for the Kentucky-based factory responsible for producing its first U.S.-made electric vehicles.
In response to the growing global demand for more eco-friendly vehicles due to environmental concerns, Toyota has set ambitious targets. The company sold fewer than 25,000 EVs worldwide last year, but in the first eight months of the current year, it sold 65,000 units, with most sales occurring outside Japan. Toyota’s aim is to achieve annual sales of 1.5 million EVs by 2026 and increase that number to 3.5 million by 2030.
While the supply chain previously suffered from chip shortages due to pandemic-related restrictions, this issue has gradually improved. Toyota is positioning itself for success by investing in various types of eco-friendly vehicles, including battery EVs, hydrogen fuel cell vehicles, and hybrid vehicles that combine electric and gasoline engines.
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Author Faith Yakubu 
