TOKYO -- Toyota Motor Corp. today said net income in the April-to-June period rose to a quarterly record 587.8 billion yen ($5.7 billion) as surging SUV sales in the United States, the company's biggest market, eclipsed shrinking demand in Japan.
For the financial year to March, Toyota raised its North America sales projection to 2.71 million vehicles from 2.62 million.
Toyota is outpacing a growing U.S. auto market headed toward its best year since 2006, buoyed by more confident consumers, recovering payrolls and low interest rates. The company’s U.S. deliveries climbed 11 percent in the April-to-June period, topping the total industry’s 6.9 percent rise. In July, Toyota's total U.S. sales rose 12 percent, surpassing Ford Motor to become the No.2 seller for the month.
"They sell an awful lot of high-end SUVs," Mark Yockey, a New York-based managing director at Artisan Partners, said before the company released results. "There’s a waiting line to buy Highlanders in the U.S., and those sell at much higher margins than if you’re just selling Corollas."
The full-year sales target for Asia excluding Japan was trimmed to 1.58 million vehicles from 1.63 million, while Europe was nudged up to 860,000 from 850,000. Japan was left unchanged at 2.21 million. The first sales-tax increase in 17 years in Japan in April dented demand for new cars in the company's home market and Toyota's April-June domestic sales dropped 10 percent year-on-year to 319,460 vehicles.
For the current calendar year, the company trimmed its global groupwide sales forecast to 10.22 million vehicles, a reduction of 110,000 vehicles, reflecting weakness in emerging markets. "Conditions in Thailand, India, Brazil and other emerging markets are weak," Managing Officer Koki Konishi told an earnings briefing. "But we're trying our best to get an additional 50,000 vehicles out of Japan to offset some of that, and to reach around 2.3 million in the U.S."