Toyota's profits rise as global chips supply crunch subsides

Toyota's January-March profit edged up 3% from the previous year on robust sales as a chips supply crunch gradually eased.

Toyota Motor Corp. racked up 552.2 billion yen ($4 billion) in quarterly net profit, up from 533.8 billion yen ($3.9 billion), according to results released Wednesday. Quarterly sales soared nearly 20% to 9.69 trillion yen ($72 billion).

For the fiscal year ended in March, profit at Japan's top automaker fell 14% on-year to 2.45 trillion yen ($18 billion). But it's forecasting profit to rise 5.2% for the current fiscal year to 2.58 trillion yen ($19 billion).

Automakers worldwide have been hurt by a shortage of computer chips and other auto parts because of restrictions over the coronavirus pandemic that crimped production in various countries.

Toyota said soaring raw material costs also hurt its bottom line.

The automaker's sales for the fiscal year that ended in March rose across global regions, including Japan, the United States, Europe and other markets, such as Asia, the Middle East and South America.

Toyota, based in Aichi prefecture's Toyota city in central Japan, sold 10.56 million vehicles for the fiscal year through March, including its group makers like Daihatsu and Hino, and expects to boost that to 11.38 million vehicles for the fiscal year ending in March 2024.

The results underline the challenges that lie ahead, as well as the ongoing resilience of the maker of the Prius hybrid, Camry sedan and Lexus luxury models.

Toyota has acknowledged falling behind in the burgeoning shift to electric vehicles, especially in key markets like China, as well as the U.S. and Europe.

Toyota had long insisted on offering models that appeal to customers in various markets, noting EVs still made up a tiny portion of the market. But recently, that has changed dramatically, catapulting players like Tesla and BYD to stardom.

Toyota pioneered hybrids, which switch back and forth between a gasoline engine and electric motor to deliver an efficient ride. It pushed hybrids for decades as a viable green solution, and still does. But it's also expanding its low-emissions options with work on hydrogen-fed fuel cell electric vehicles. Such zero-emissions vehicles have already hit the road in various Toyota models in Japan, including buses and delivery vehicles.

In a statement, Toyota said it's committed to further growth and will continue to offer diverse options in ecological models, including hybrids and plug-ins as well as battery electric vehicles to "make sure to meet a wide range of global demand."

Toyota officials, including the new president and CEO, Koji Sato, have acknowledged the company must play catchup in delivering EVs.

All eyes are on Sato to see if he'll live up to his job. Sato replaced Akio Toyoda, the grandson of the automaker's founder. Toyoda remains a chair of the company.

Sato promised to work closely with Toyoda to speedily respond to market demands, including EVs, so Toyota can continue to grow.

"The foundation for this is carbon neutrality," he said.

Sato stressed Toyota would stay aggressive, launching 10 EV models in China and the U.S. by 2026. Toyota will secure a steady supply of batteries for EVs by boosting in-house production and working closely with partners, said Sato.