Toyota records a fall in Quarter 2 profits due to chip shortage

By Tejaswita Tiwari  | Date: 2022-08-06

Toyota records a fall in Quarter 2 profits due to chip shortage

Japanese multinational automobile manufacturer, Toyota, has recently reported an 18% fall in its 2022 Q2 profits compared to the previous year due to the prolonged semiconductor shortage that has crippled the global auto industry.

The automotive major reported a quarterly profit of ¥736.8 billion ($5.5 billion), down from ¥897.8 billion ($6.6 billion) from the previous year.

However, the quarterly sales rose by 7% to ¥8.49 trillion ($63 billion).

It is imperative to note that several issues apart from the chip shortage have challenged production, including sweeping pandemic lockdowns in Shanghai and floodings in South Africa.

Notably, the chip shortage has severely impacted the electric vehicle industry. Apart from this, the skyrocketing cost of materials has also hindered Toyota’s bottom line.

As per sources, Toyota officials have apologized to the customers who have been waiting for their cars after placing orders. Apparently, some have waited so long that the vehicle model went through an update in the meantime.

According to reports, Toyota sold around 2 million vehicles during the quarter, which was down by 2.1 million as compared to last year.

Despite this, the automaker did not change its full fiscal year forecast to produce 9.7 million vehicles, stating that the output will increase in the coming months.

Toyota has reported record earnings for the past fiscal year through March, booking a profit of ¥2.85 trillion ($21 billion), up as much as 27%.

For the upcoming fiscal year (2023), it anticipates a profit of ¥2.36 trillion ($17.6 billion). The projection was reviewed upward from the estimated ¥2.26 trillion ($16.9 billion).

Toyota has often been accused of deliberately lagging behind in electric vehicles as its hybrid vehicles unit has historically performed well, with iconic cars like the Prius leading the charge.

The firm expects to sell more than 10.7 million vehicles globally in the fiscal year by March 2023, up from around 10.4 million vehicles in the fiscal year prior to that.

Source credit: https://japantoday.com/category/business/toyota-profit-down-as-chips-shortage-keeps-customers-waiting

About Author

Tejaswita Tiwari     thisisourtownrichmond.co.uk

Tejaswita Tiwari

Being born in a family of readers, Tejaswita has always had a natural flair for writing, using that enthusiasm to become a full-fledged writer after earning her MBA in Marketing. Her insatiable curiosity to learn about various verticals has made her a popular research...

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