The image of cars on a parking
Toyota Motor Corp is considering trimming its 2012 group-wide production plan by about 2 per cent because of a drop in sales in China after a territorial row, a Japanese newspaper reported, but the company denied it had altered its target.
Asia’s top automaker may cut its calendar-year production forecast for 10.05 million vehicles by around 200,000 vehicles, the Mid-Japan Economist newspaper said on its website on Thursday, without citing sources. The regional daily is based in central Japan, where Toyota’s headquarters is located.
“The figure cited in the report is not based on anything announced by us, and at this time there are no changes to the figures we presented earlier,” said Toyota spokeswoman Shino Yamada.
Shares in Toyota had risen 1.8 per cent early Thursday, outperforming the Nikkei index, which was up 1.26 per cent.
Tetsuro Ii, the chief executive officer of Commons Asset Management, said the shares rose because of a favourable dollar-yen exchange rate, and that investors do not see a big dent in the firm’s profits from the possible production cut.
“Because Toyota is very aware of the global slowdown at the moment, they’re trying hard to control their inventory and so they tend to put out very conservative estimates,” he said.
The yen, which has been trading recently in the 78-yen range against the U.S. dollar, weakened to about 79.1 yen in morning trade. A strong yen makes it more expensive for Japanese automakers to export cars from Japan.
Toyota’s original production target, which includes output at Daihatsu Motor and Hino Motors, would make Toyota the first automaker to produce more than 10 million vehicles in a year.
Showroom traffic and sales across China have plunged at Japanese carmakers since mid-September when violent protests and calls for boycotts of Japanese products broke out in China over a group of disputed islands in the East China Sea.
Toyota and its two local Chinese partners saw sales drop 48.9 per cent in September from a year earlier to 44,100 vehicles.
A source previously told Reuters that Toyota’s production cutbacks in China were likely to extend through November, a move that would almost certainly put the company’s goal of selling 1 million cars in China this year out of reach.
Toyota, whose sales in China accounted for about 12 per cent of its total global vehicle sales in 2011, is less exposed to the world’s biggest auto market than rivals Nissan Motor Co and Honda Motor Co.
Analysts have said that Japanese automakers could see a dent in sales in China for months. Takaki Nakanishi, an auto analyst at Bank of America Merrill Lynch in Tokyo, said that the impact could last three months in an optimistic scenario and up to six months in a pessimistic scenario.
Toyota has forecast group-wide global sales of 9.76 million vehicles in calendar year 2012. The automaker is set to announce its July-to-September earnings results on Nov. 5.