Toyota's profit plunges as pandemic halves vehicle sales

 Toyota's profit plunged 74 per cent in the last quarter as the coronavirus pandemic sank vehicle sales to about half of what the top Japanese automaker sold the previous year. Toyota Motor Corp. reported on Thursday a profit of 158.8 billion yen (USD 1.5 billion) in April-June, down from 619 billion yen in the same period last year.

Toyota sold nearly 1.2 million vehicles globally during the quarter through June, down from 2.3 million vehicles last year.

Quarterly sales dipped 40 per cent to 4.6 trillion yen (USD 43.6 billion), almost entirely because of damage from the pandemic that resulted in lockdowns, production halts and sales disruptions, the company said.

Toyota's sales were hurt in nearly all global markets, including the U.S., Japan and Europe. Sales were starting to recover in China, where the outbreak began late last year.

Although all the world's automakers have been hurt badly by the outbreak, Toyota managed to stay in the black for the quarter, highlighting the resilience of the manufacturer of the Corolla subcompact, Prius hybrid and Lexus luxury models.

Japanese rivals, Honda Motor Co. and Nissan Motor Co., as well as Detroit-based General Motors Co. slid into red ink in the latest quarter.

Toyota is projecting a 730 billion yen (USD 6.9 billion) profit for the fiscal year through March 2021, down 64 per cent from the previous fiscal year.

Toyota officials said the sales decline was bottoming out, with sales expected to gradually return to near-normal levels later this year.

Toyota said the recovery was going better than it had expected.

It raised its vehicle sales forecast for the fiscal year through March 2021 to 7.2 million vehicles from the forecast of 7 million vehicles it gave in May. That's still down from the nearly 9 million vehicles Toyota sold in the previous fiscal year.

Toyota warned huge uncertainties remain over the pandemic.

"The impact of COVID-19 is wide-ranging, significant and serious, and it is expected that weakness will continue for the time being," the company said in a statement.

Toyota said measures were in place at plants and other locations to keep infections in check, such as keeping seats apart in worker cafeterias and avoiding face-to-face dialogue.

But it's keeping its plants, as well as dealers and other operations going, company officials said.