Toyota's Q1 profit nearly wiped out as coronavirus erodes car sales

TOKYO: Toyota Motor Corp posted a 98% plunge in its first-quarter operating profit on Thursday as the coronavirus pandemic halved it global sales.

Japan's top automaker reported a profit of 13.9 billion yen ($131.73 million) for the three months ended June, its worst since the June 2011 quarter. Still, it was better than an average estimate for a loss of 179 billion yen based on a Refinitiv poll of seven analysts.

The bleak results underline the challenges being faced by the global auto industry due to the health crisis that has shuttered factories this year and kept customers out of dealerships, hitting production and sales.

Toyota reiterated its forecast for an annual operating profit of 500 billion yen, which would be its weakest in nine years, while raising its vehicle sales forecast.

Toyota, which like its rivals saw sales and production crash over March-May, expects its global sales to fall 13% in the year ending March 2021, versus its prior outlook for a 15% drop.

The maker of the RAV4 SUV crossover and the Prius gasoline hybrid expects to sell 9.1 million cars this fiscal year to March, down from 10.46 million last year, but better than a previous forecast for 8.9 million units.

That would still mark its lowest sales in nine years, hit by a 14% drop in sales in North America - Toyota's biggest market that accounts for about a quarter of its global sales.

In the first quarter, global sales fell 50% to 1.16 million units, led by a 62% tumble in North America.

Toyota expects production to largely return to normal levels this month.