Toyota's earnings to surge again

Posted by: Ian Rowley on October 22, 2007

Toyota’s ascent to becoming the world’s biggest automaker isn’t a forgone conclusion, but don’t expect the company’s execs to be sweating. Sure, the latest data, released yesterday, show that GM has regained the lead over Toyota in the battle to be the world’s largest automaker. For the nine months through September, GM sold 7.06 million vehicles worldwide to Toyota’s 7.05 million.

And itwasn’t the only piece of downbeat news recently. In another sign of slowing U.S. auto sales, Toyota Motor Sales U.S.A.’s Bob Carter said on Oct. 19 that the company would cut annual its sales target for year from 2.68 million to 2.6 million units. “We now expect the U.S. car market to shrink slightly this year compared with year-ago, while Toyota continues to strive to meet its initial target,” told Wards.

But when it comes to perhaps the most important measure of corporate success—earnings—Toyota is peerless. Today’s Nihon Keizai, a Japanese business newspaper, reckons Toyota’s interim earnings for the six months ended Sept 30 will once again show stellar, record earnings and strong global sales.

While the company won’t post the figures for a couple of weeks, the Nikkei says it expects Toyota’s operating profit to rise roughly 10% to over $10.5 billion for the six months ended Sept. 30. Sales, meanwhile, are projected to have increased about 10% to nearly $113 billion, despite a prolonged slump in Japan where Toyota’s share exceeds 40%.

Reader Comments

mark

October 23, 2007 8:37 PM

The volume of sales on units is one of the facts to measure the company's success, but the annual earning after tax is still considered the last conclusion. Each company has its own strategy of marketing, and manufacturing based on their market analysis - demand, and supply. If you make more, and sell less; you will stuck with those overstock and cash inflow or funds are low. Margin of those high-end products - luxury cars vs margin of compact cars can be measured in their short-term and long term strategies, and depending on the current market - employment and unemployment rate.

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