Toyota to post rise in Q1 profit on hybrid demand, but momentum may be slowing
By Daniel Leussink
TOKYO, July 31 (Reuters) -Demand for hybrids is likely to deliver another quarter of double-digit growth for Japan's Toyota Motor 7203.T when it reports earnings on Thursday, although it is expected to show signs of slowing after a run of record profits.
Analysts will be paying close attention to how much momentum the world's top-selling automaker has lost from previous quarters, given challenges like a tough market in China and fallout from a certification scandal.
Sales data already give a hint of the potential slowdown. Toyota's global sales declined 2% in April-June versus a year earlier as robust U.S. and European demand wasn't enough to make up for declines at home and in China.
For the April-June quarter, Toyota is expected to deliver a 20% rise in operating profit to 1.3 trillion yen ($8.50 billion) the average prediction of six analysts shows, as per LSEG.
That would be the company's weakest profit growth since July-September 2022. The automaker has already forecast a 20% decline in full-year profit, citing looming investment in both its strategy and suppliers.
Toyota has benefited from a slowdown in global demand for electric vehicles, allowing it to sell more hybrids, which typically command higher margins than regular gasoline cars.
The company's inventories in the U.S. are also tight, reducing the risk of incentive spending to entice customers to buy cars, said James Hong, head of mobility research at Macquarie.
"You basically have one of the largest market players with the lowest level of inventory," he said, adding that, together with the company's growing hybrid offering, was likely to help keep earnings at a high level.
Hybrids made up 39% of Toyota's global sales in the first six months of the year, or 1.9 million vehicles, including the luxury Lexus brand, according to company data.
The strategy to boost hybrid sales in the U.S. over the short term instead of battery-electric vehicles might also shield it from potential changes in U.S. government policy on EVs.
Former President Donald Trump, the Republican candidate in the U.S. presidential election, has said he would end the government EV mandate if he wins.
Shares of Toyota are up 13% so far this year, but have not performed well over the past months, coming down 25% from a peak in late March.
In dollar terms, they are up 6%, compared to a 10% decline in Tesla TSLA.O over the same period.
Toyota's strong financial performance and gains in its share price belie pressure that Chairman Akio Toyoda has faced over certification irregularities at Toyota Group companies and the automaker itself.
In an interview published on Monday, the grandson of the company's founder said he may not be re-elected as a board director if shareholder support for him, which slid to 72% this year from 85% in 2023, continues to fall at the pace it did.
While strong in hybrids, Toyota still trails behind rivals such as Tesla and European and Chinese automakers when it comes to EVs, which accounted for only 1.5% of its global sales in the first half of the year.
Toyota's China sales were down 11% to 785,000 vehicles over the first six months of 2024, compared to a 14% gain to 1.2 million vehicles in the U.S over that period.
($1 = 152.8800 yen)
Reporting by Daniel Leussink; Editing by David Dolan and Varun H K
Activos relacionados
Últimas noticias
Descargo de responsabilidades: Cada una de las entidades de XM Group proporciona un servicio de solo ejecución y acceso a nuestra plataforma de trading online, permitiendo a una persona ver o usar el contenido disponible en o a través del sitio web, sin intención de cambiarlo ni ampliarlo. Dicho acceso y uso están sujetos en todo momento a: (i) Términos y Condiciones; (ii) Advertencias de riesgo; y (iii) Descargo completo de responsabilidades. Por lo tanto, dicho contenido se proporciona exclusivamente como información general. En particular, por favor tenga en cuenta que, los contenidos de nuestra plataforma de trading online no son ni solicitud ni una oferta para entrar a realizar transacciones en los mercados financieros. Operar en cualquier mercado financiero implica un nivel de riesgo significativo para su capital.
Todo el material publicado en nuestra plataforma de trading online tiene únicamente fines educativos/informativos y no contiene –y no debe considerarse que contenga– asesoramiento ni recomendaciones financieras, tributarias o de inversión, ni un registro de nuestros precios de trading, ni una oferta ni solicitud de transacción con instrumentos financieros ni promociones financieras no solicitadas.
Cualquier contenido de terceros, así como el contenido preparado por XM, como por ejemplo opiniones, noticias, investigaciones, análisis, precios, otras informaciones o enlaces a sitios de terceros que figuran en este sitio web se proporcionan “tal cual”, como comentarios generales del mercado y no constituyen un asesoramiento en materia de inversión. En la medida en que cualquier contenido se interprete como investigación de inversión, usted debe tener en cuenta y aceptar que dicho contenido no fue concebido ni elaborado de acuerdo con los requisitos legales diseñados para promover la independencia en materia de investigación de inversiones y, por tanto, se considera como una comunicación comercial en virtud de las leyes y regulaciones pertinentes. Por favor, asegúrese de haber leído y comprendido nuestro Aviso sobre investigación de inversión no independiente y advertencia de riesgo en relación con la información anterior, al que se puede acceder aquí.
