- Title: Toyota Q2 operating profit tumbles on strong yen
- Date: 8th November 2016
- Summary: OTA, JAPAN (FILE - MARCH 2012) (REUTERS) VARIOUS OF TOYOTA FACTORY LINE FOR TOYOTA 86 SERIES (ALSO CALLED GT86, FT86, SUBARU BRZ, SCION FR-S IN OTHER PARTS OF THE WORLD - DEVELOPED JOINTLY WITH SUBARU) TOKYO, JAPAN (FILE - MAY 2014) (REUTERS) VARIOUS OF 5,000 YEN NOTES BEING PRINTED
- Embargoed: 23rd November 2016 09:23
- Keywords: Toyota Q2 operating profit tumbles strong yen
- Location: OTA + TOKYO, JAPAN
- City: OTA + TOKYO, JAPAN
- Country: Japan
- Topics: Company News Markets,Economic Events
- Reuters ID: LVA00157L3EDP
- Aspect Ratio: 16:9
- Story Text: Toyota Motor Corp. on Tuesday (November 8) said operating profit almost halved in the second quarter as the world's top-selling automaker smarted from a strong yen that has made its Japan-built cars less competitive and crimped the value of overseas earnings.
Operating profit fell 43 percent to 474.6 billion yen ($4.55 billion) in the July-September period compared with a year earlier. The result was roughly in line with the 476.26 billion yen average of 12 estimates from analysts surveyed by Thomson Reuters I/B/E/S.
While all Japanese automakers are feeling the currency pinch, Toyota is more exposed to swings in foreign exchange because it produces two-fifths of its vehicles in Japan, half of which it exports.
The latest yen squeeze also comes as sales in North America, one the world's biggest auto markets, slow after record sales in 2015 that automakers and analysts saw as the peak of the U.S. recovery from the 2008-2009 economic crisis.
Cheap fuel is also spurring demand for petrol-guzzling models leaving Japanese automakers struggling to raise production of sport utility vehicles and trucks.
Toyota has said it will make more of those larger vehicles including its popular RAV4 crossover model in the United States, to take advantage of that shift in consumer preference.
On Tuesday, Toyota also changed its full-year budgeted yen rate to 103 versus the U.S. dollar and 114 to the euro, from 102 and 113 respectively. It lifted its forecast for full-year operating profit to 1.7 trillion yen from 1.6 trillion yen, which would be its lowest since 2013.
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