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November 6, 2009

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Home » Business » Auto

Toyota shifts back into profit

TOYOTA Motor Corp reported yesterday that it returned to a profit in the latest quarter and trimmed its projected red ink for the year, underlining the gradual recovery under way for Japan's giant auto makers.

The world's largest car company reported a better-than-expected 21.8 billion yen (US$242 million) profit for the July-September period after three straight quarterly losses, citing stronger sales boosted by government incentives.

The result marked an 84 percent plunge from the 139.8 billion yen profit racked up during the same period a year ago, but offered evidence that Toyota was starting to heal after its worst loss ever in the last fiscal year.

Other Japanese auto makers have made similar strides recently, with Honda Motor Co and Nissan Motor Co both reporting healthier earnings after taking a battering from the global economic crisis.

Toyota said it now expects to sell more vehicles for the fiscal year through March 2010, raising its projections to 7.03 million vehicles from 6.6 million.

The revised forecast still marks a 7 percent drop from the more than 7.5 million vehicles Toyota sold around the world in the fiscal year ended March 31, though sales were growing in Japan and the rest of Asia compared with a year ago.

The company, which makes the Prius hybrid and the Corolla subcompact, said sales in the last six months were beating earlier expectations as government efforts to attract more buyers spur global demand.

Toyota forecast a smaller loss for the fiscal year of 200 billion yen - less than half the 450 billion yen of red ink it had predicted earlier. If Toyota can manage the latest forecast, it would be a major improvement over the 437 billion yen loss it posted during its last fiscal year, the worst performance in the company's 72-year history.

Despite the latest result, Toyota is still struggling. In a tearful news conference on Wednesday, Toyota pulled out of expensive but glamorous Formula One racing, acknowledging it has to focus on its core car business.


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