Toyota Japan Forecasts 80% Drop in Operating Profit This Year: "Shock Greater Than Financial Crisis"

[Image source=EPA Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Japan's Toyota Motor Corporation has forecast that its operating profit will decrease by nearly 80% this year due to the impact of the novel coronavirus infection (COVID-19).

According to NHK and other sources on the 12th, Toyota stated in its earnings report that for the fiscal year 2020 (April 2020 to March 2021), its consolidated operating profit is expected to decline by 79.6% compared to the previous year, reaching 500 billion yen. This forecast is based on the assumption that the global automobile market will gradually recover from the second quarter of this year as the lowest point and return to the previous year's level from the end of this year through the first half of next year.

Toyota analyzed, "The future global economy is expected to experience a sharp downturn in many countries and regions due to the impact of COVID-19. Significant effects are already being seen in automobile production and sales."

However, Toyota stated that it is currently difficult to reasonably estimate the scale of net profit this year due to the impact of COVID-19. Akio Toyoda, President of Toyota, emphasized, "The shock from COVID-19 is greater than the impact of the global financial crisis," and added, "We will maintain a domestic production system of 3 million units going forward."

Toyota's operating profit for the fiscal year 2019 was 2.442869 trillion yen, a 1.0% decrease from the previous year, while net profit increased by 10.3% to 2.076183 trillion yen. Toyota's global sales volume for the fiscal year 2019 (consolidated basis) was 8.958 million units, a 0.2% decrease compared to the previous year.

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