Shares in Toyota Motor fell 10% after Japanese media said the giant automaker may cut its annual profit forecast as global demand falls and the yen firms.
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The Nikkei business daily reported TMC would likely record a 40% plunge in annual profit, missing its own estimates and analysts’ forecasts.
The automaker has cut its sales volume forecasts for 2008 and 2009 in recent months.
Toyota is now looking at the extent of a possible revision, an unnamed source told Reuters.
The Nikkei said Toyota’s operating profit was likely to be around 1.3 trillion yen (US$12.8bn), short of its current forecast of a 30% fall to 1.6 trillion yen and a Reuters Estimates projection of 1.63 trillion yen from 20 analysts.
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By GlobalData“This is something that people have been talking about for a while. But it’s still a surprise, nonetheless,” Mizuho Asset Management fund manager Yoshihisa Okamoto told the news agency.
“Toyota is such a symbolic issue in Japan’s manufacturing sector, and the fact that the company is likely to post an earnings decline of this scale, has got to have a severe impact on investor sentiment.”
The Yomiuri newspaper reported Toyota was set both to revise down its forecasts and reduce output in Europe – it has already announced some cutbacks here in the UK.
A Toyota spokeswoman declined to comment to Reuters on the reports.
The Nikkei also said Toyota may not achieve its current group sales estimate of 25 trillion yen, already down 5% year on year, nor this year’s [revised] global sales target of 9.5m units.
Another news agency also said Toyota had declined to comment on the Nikkei report though senior managing director Yoichiro Ichimaru said the automaker was maintaining its targets, including this year’s global vehicle sales goals, though he acknowledged that the targets were becoming increasingly tough to meet because of a drop in US sales.
“When we look at our numbers, we see things are very critical,” Ichimaru said. “US and Europe sales are getting seriously hit because of the economic conditions.”
Toyota sales plunged 29.5% to 144,260 in the US last month and were off 10.4% to 1,793,303 in the first three quarters.
Toyota managing officer Toshio Furutani was quoted as saying global Lexus sales were down on 2007’s 518,000 vehicles with the trend likely to continue for the rest of 2008.
