Toyota records record net profit

By Glenn Dyer | More Articles by Glenn Dyer

Tesla might be the world’s most valuable carmaker by market value, but Japan’s Toyota Motor has confirmed its giant status when it comes to sales, revenues, and earnings, completely outclassing Elon Musk’s tattered company.

Wednesday saw Toyota reveal a record net profit for the year ending March 31 of 4.9 trillion yen ($US31.8 billion), double that of 2022-23, thanks to the weak yen and rising demand for its conventional hybrid vehicles (and not plug-in hybrids of the sort being produced in China).

That was also the largest ever profit from a Japanese company, a claim that Tesla and Musk cannot make about their position in the US business.

Revenue rose to a record $US291 billion for the year.

Toyota's previous record annual net profit was 2.85 trillion yen in 2021-22. For revenues, it was 37.15 trillion yen in 2022-23.

Last month, Toyota said it sold 11.1 million vehicles across all brands in the 2023-24 fiscal year, up 5%, marking the first time they have exceeded 10 million. 10.3 million Toyota-branded vehicles were sold (the remainder from other brands), up 7%.

Sales in Asian regions, including China, Southeast Asia, and India, were similar to the previous year at 3.3 million vehicles.

Strong demand in North America, Europe, and Japan (and the weak yen) helped drive revenue and earnings; demand for its conventional regenerative hybrids was very strong, especially in the US.

That helped drive the 31% increase to 3.7 million in sales of hybrid vehicles like the Corolla and the RAV4 sports utility vehicle.

Sales of purely electric cars were much more modest at 116,500.

The company forecasts a current full-year net profit of around 3.6 trillion yen for the current financial year, down 27.8% because of accelerating spending on EVs and research and development (hydrogen power remains a favorite for the company).

Appetite for Toyota's hybrid vehicles has been particularly strong outside Japan, and the company also plans to boost its electric vehicle output. It recently announced plans to invest $US1.4 billion to start producing EVs at an American factory in 2026.

Toyota aims to sell 1.5 million EVs annually by 2026 and 3.5 million by 2030, but it will have to hurry as Chinese makers, led by BYD, are making big inroads in emerging markets where Toyota has always done well.

In 2023, China overtook Japan as the world's biggest vehicle exporter, a change fueled by the country's dominance in EVs.

While Toyota is not struggling in the Chinese domestic market, it is finding the going tough (as is Tesla). Toyota only sold 1.9 million vehicles, a rise of just 1.4%. That lackluster performance was more vehicles sold than Tesla did across the globe in 2023.

Its lack of a viable range of EVs and Plug-in hybrids is hurting the company in the ultra-competitive Chinese market.

And while Tesla is still a bigger company by market value, $US557 billion on Tuesday and down 28% year to date, Toyota’s market value is up 34% to nearly $US380 billion on Wednesday.

About Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

View more articles by Glenn Dyer →