Toyota Hikes Global Sales Target

Tokyo, July 29: | Updated: Jul 30 2002, 05:30am hrs
The world’s third-largestautomaker, Toyota Motor Corp, boosted its 2002 sales target on Monday by 3.3 per cent, expecting an increase in overseas sales despite a surge in the yen.

Japan’s largest automaker said it expects to sell 6.19 million vehicles this year, up 200,000 from an original plan, on robust sales in Europe and Asia, and a slightly stronger outlook in the United States.

That compares with group sales of 5.93 million in calendar 2001.

The revision came despite a 12 per cent rise in the yen against the dollar since April, a leap that makes Japanese cars less profitable when sold overseas and poses a challenge for automakers who reaped currency gains last year as the yen fell.

The figures include Toyota minivehicle unit Daihatsu Motor Co Ltd and truck unit Hino Motors Ltd, but the increase in the higher target reflects entirely a boost in sales of Toyota brand vehicles, the company said.

Strong overseas sales and a weak yen had helped push Toyota to record profits in the business year ended in March.

The automaker said it achieved cumulative sales of 10 million vehicles in North America since it began producing cars there almost 16 years ago.

Most automakers had assumed an average rate of 125 yen to thedollar for the year, but analysts project the average rate to come in at 120 yen if current levels continue for the rest of the year. On Monday, the yen was trading at 119.13 per dollar.

Even so, analysts have said Toyota, as well as rivals Honda Motor Co Ltd and Nissan Motor Co Ltd, is still on track to post record profits for the second straight business year in the 12 months to next March.

Toyota said on Monday that it did not intend to change its forecasts despite the recent weakening of the yen.

Toyota, as well as other Japanese automakers, has been moving more production offshore to protect itself from currency fluctuations.

In one such move, Toyota said it would begin manufacturing the luxury Lexus RX300 in Canada next year, the first time it will build Lexus-brand vehicles in North America.

“Longer-term, the company could look at building Lexus vehicles in the United States as well,” president Fujio Cho told a news conference.

And as more production moves from Japan, Toyota said it would have to consider overhauling some production sites at home.

Cho said much would depend on how fast the domestic economy recovers.

But he singled out the Motomachi plant as one site that could be considered for downsizing or closing. The factory employs 5,900 people and produces the Crown and Prius, among others.

Toyota boosted its forecast for group global production by 280,000 units or 4.7 per cent to 6.28 million units, compared with last year’s result of 5.85 million units.

Its group domestic production forecast was lifted to 4.15 million units, an increase of 250,000 units or 6.4 per cent. It compares with domestic production of 4.05 million units in 2001. Toyota’s group export forecast was boosted to 1.85 million units, an increase of 270,000. Last year Toyota’s exports totalled 1.75 million units.

The auto giant also said it did not expect to see major appraisal losses on its stockholdings despite the recent plunge in the stock market.

Reuters