Toyota Motor Corporation warned that profits could fall by a fifth in the coming year as rising raw material costs, supply chain issues and the pandemic continued to weigh heavily.
The Japanese auto giant said it has temporarily suspended, or plans to suspend, production of cars and components at some factories in Japan and overseas due to China’s ongoing Covid-19 lockdowns.
Other factors expected to affect Toyota in the current year include rising raw material prices and potential supply chain delays. As a result, the world’s largest automaker now forecasts full-year 2023 operating profit of 2.4 billion yen, down 20% from 2022, and revenue of 33 billion yen. , which would represent a decrease of 5.2%.
It expects to sell 10.7 million vehicles during the year, up from 10.3 million the previous year.
The updated guidance came as Toyota posted fourth-quarter revenue of 8.1 billion yen for the three months ending March 31, 2022, up 6%. Operating profits, however, fell 33% to 463 billion yen year-on-year.
Toyota said: “Automotive markets have recovered from 2021 as demand remained firm in regions such as the United States, China and Japan, although it was constrained to curb production globally due to limited parts supply caused by global semiconductor shortages and the impact of Covid19.
“At present, the outlook has become even less clear as the impact of increased geopolitical tensions from February 2022 has spread around the world through a spike in commodity prices and other ramifications.”