Toyota profits tumble in FY2011, pledges recovery

Japan's Toyota Motor said Wednesday net profit for the year to March fell 30.5 percent to 283.56 billion yen ($3.56 billion), hit by last year's quake-tsunami disaster and record flooding in Thailand.

But the country's biggest automaker, also stung by the strong yen, pledged a sharp rebound in the current fiscal year, expecting net profit to more than double to 760 billion yen on surging demand in emerging markets.

Toyota also forecast operating profit to nearly triple year-on-year to 1.0 trillion yen as consumers opt for small and economically priced vehicles, as well as "green" models, a key segment for the manufacturer.

"Our vision is to establish a strong business foundation that will ensure profitability under any kind of difficult business environment," company president Akio Toyoda said in a statement.

Toyoda later told a press briefing in Tokyo that "the new platform of sustainable growth has just begun."

"I really hope this year will be peaceful so that our efforts start showing tangible results," he added.

Japanese automakers were hammered last year by the March 11 quake-tsunami, which caused huge production problems, while the Thailand flooding months later sparked supply-chain headaches for firms with plants there.

The yen also hit a record high against the dollar in 2011 but began to weaken from early this year, a decline that will help exporters whose products become more expensive overseas when the currency strengthens.

Toyota's share price was unchanged Wednesday at 3,145 yen before the earnings results were released.

"Toyota's forecasts look realistic," said Tatsuya Mizuno, an auto analyst at Mizuno Credit Advisory in Tokyo.

"The company is out of the crisis that started in 2008 with the Lehman Brothers shock (at the start of the financial crisis), its profits are increasing, and it is moving in a good direction compared to previous years."

But Mizuno also warned that Toyota was lagging domestic rivals Honda and Nissan, while its efforts to turn hybrid vehicles into a major force outside Japan had yet to bear fruit.

"The relative position of Toyota is still weak in the global market, and in comparison to Nissan or Honda," he said.

The firm, which said it sold 7.35 million vehicles in the year to March for total sales of 18.58 trillion yen, down 2.2 percent, lost its number one spot in the global carmakers' league last year.

It had been the world's biggest automaker since 2008 and sold 8.42 million vehicles in 2010.

But its 2011 figure leaves US giant General Motors, with about 9.0 million in unit sales, back on top after it emerged from bankruptcy, with Germany's Volkswagen in second, selling more than 8.0 million vehicles.

Toyota has also been forced into damage control in recent years after recalling millions of vehicles since 2009 over safety defects.

Despite the setbacks, Toyota said it was aiming to boost sales to 8.7 million vehicles globally in the fiscal year ending March 2013.

"We expect a great increase in sales mainly in North America and Asia this year, especially as we plan to roll out new models," Satoshi Ozawa, Toyota's executive vice president, told the news briefing.

The company is hoping some of its growth comes from environmentally friendly vehicles including what it said was the first all-electric sports utility vehicle on the market, which it unveiled this week.

The electric version of its popular RAV4 will be sold initially only in California with a base price of $49,800, with Toyota expecting to sell a modest 2,600 units over the next three years.

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