Toyota, the world's largest automaker, has announced its conservative profit forecast for the fiscal year through March 2024, in line with analysts' expectations. The company plans to achieve operating profit of ¥3 trillion and net sales of ¥38 trillion. New CEO Koji Sato is leading Toyota's transition into the era of electrification, promising to rapidly expand its production of electric vehicles (EVs) and sell 1.5 million battery-based EVs annually by 2026.
Despite the ambitious EV targets, Sato is maintaining Toyota's strategy of spreading its bets across multiple technologies, including hybrid cars and hydrogen fuel. Toyota's efforts to mitigate climate change depend on the decarbonization of massive manufacturers like itself, with the company planning to invest ¥3.1 trillion in sustainable growth, including decarbonization and electrification.
Toyota reported operating profit of ¥2.7 trillion for the fiscal year ended March 2023, exceeding analysts' expectations and its own conservative forecast. However, operating income fell sharply in North America, Europe, and China. The company's total global auto sales, including Daihatsu and Isuzu, are expected to reach 11.4 million units in the current fiscal year, up from 10.6 million in the prior period.
Toyota's shares rose by up to 2.5% following the announcement of plans to buy back up to ¥150 billion ($1.1 billion) of its own stock. Sato emphasized that transitioning Toyota from a car company to a mobility company is his foremost priority, with the foundation of this shift being carbon neutrality. However, the company is facing challenges with parts and semiconductor shortages, which may affect its production.
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