TOKYO — Toyota Motor expects an 80% drop in operating income this year as disruption caused by the coronavirus pandemic plagues the Japanese car giant, hitting both demand and production.
Toyota expects operating income of 500 billion yen ($4.6 billion) for the fiscal year that ends in March 2021, the company said at its earnings conference on Tuesday.
Sales revenue is expected to fall 20% to 24 trillion yen while overall sales volumes are expected to fall 22% to some 7 million vehicles.
Akio Toyoda, president of Toyota, said the shock from the coronavirus pandemic was far greater than had been faced after the global financial crisis after 2008. But he said the world’s second largest car producer could be “the leader of the economic rebound” once the pandemic subsided.
“The earnings this time is a starting point for the company to become a new Toyota,” Toyoda said.
For the fiscal year that ended in March the company announced net profit of 2.076 trillion yen, down 10.3 % from the previous year, while revenue fell 1% to 29.9 trillion yen.
Japan’s largest carmaker by production halted 27 plants in 20 countries by mid-April as the coronavirus pandemic spread around the globe. But Toyota said it was seeing a recovery in the Chinese market, which posted a 0.2% increase in vehicle sales for April from the same month last year, after the company restarted full production there at the end of March.
While weak demand and problems with global procurement are expected to hit output, Toyota also restarted its production in the U.S. and Canada on Monday, though on a limited basis.