Toyota Sales Drowned by Thai Floods, Profits Cut by Half
The world's largest automaker is cutting its forecasted profits 54 percent as production is hit especially hard by the recent flooding in Thailand. Toyota's Thai facilities are responsible for producing parts for the company's breadwinner, the Camry, and the Japanese automaker's popular hybrid, the Prius. According to a report by Automotive News, net income will fall to 180 billion yen, or $2.3 billion U.S. dollars. This comes just as Toyota was recovering from the March earthquake and tsunami that significantly hindered Japanese production. Honda, which was also affected, said it will release an updated forecast at the end of next month. Japan's second largest automaker, Nissan, has fared much better, even increasing its outlook heading in to the new year. Nissan was less affected by parts shortages and inventory problems, and that's translated over to its bottom line. Also making matters difficult for Japanese automakers is the especially strong yen, which affects export prices. Still, despite inventory shortages, the company is estimating it will sell 7.38 million cars on the year, and President Akio Toyoda believes cars like the new Toyota GT 86 (Scion FR-S in the United States) will expand the company's appeal and market. Source: Automotive News (subscription required)
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