TOKYO (WWJ) – After several years marked by recalls and natural disasters, Toyota is earning big money again.
Toyota posted a $13.3 billion profit (314 billion yen) for the fiscal year that ends in March. That’s roughly the same amount as the combined 2012 earnings of GM and Ford.
President Akio Toyoda said the improved earnings were the result of improved sales in North America and Asia.
“We have faced many challenges since 2009 but have learned valuable lessons, including the need for Toyota to maintain sustainable growth. We believe that the driver for sustainable growth is ultimately ever-better cars, and we are launching cars developed with this mindset.”
Toyota’s also been helped by an exchange rate that has become more favorable to Japanese carmakers.
The last several years had been rough for Toyota. The global recession was followed by recalls in the United States. Then as Toyota was dealing with the earthquake and Tsunami in Japan, it also saw production and sales curtailed by flooding in Thailand.
2013 saw the company rebound from all of those issues, and regain the global sales crown, selling 8.9 million cars and trucks. Toyota expects to top 9.1 million sales in the coming year.
“Toyota has recovered much of the market share lost due to the recalls and natural disaster,” said Alec Gutierrez, senior analyst at Kelley Blue Book. “Although Toyota has seen solid growth in market share and sales since 2012, sales declined in April.
“Toyota now finds themselves in one of the most competitive environments the industry has seen in decades, facing strong entrants from familiar competitors Honda and Nissan, as well as reinvigorated competition from U.S. and Korean automakers. Although Toyota will find that gaining market share will be difficult moving forward, the new Corolla launching later this year could inject new blood into the brand while a declining Yen could help shore up the bottom line,” he said.
Toyota faces a number of challenges. Recent strains between Japan and China have hurt its sales in the world largest car market. Here in the U.S., domestic carmakers have started improving their market share, and studies show that buyers who were once very loyal to Toyota, are again willing to check out a “Detroit Three” product.
The response from Toyota has been to shift more production to the United States, and to give more authority to executives here, adding more Americans to Toyota’s board of directors, and appointing long time American executive Jim Lentz to become Toyota’s first-ever CEO of North America.
Akio Toyoda says the company expects to earn around $14 billion in the coming year.
“I am convinced that the positive cycle defined for our business in the Toyota Global Vision is now gradually but steadily taking shape.”
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