Toyota upgraded its full-year profit forecast last Thursday after a strong quarter that saw production cuts caused by the global chip shortage and supply chain issues in the pandemic-hit Southeast Asia.
Toyota currently has the lion’s share in the Bangladesh market with a staggering 80% as rest of the major global brands such as Honda, Nissan and Mitsubishi do not even come close.
To put things in perspective, Honda’s market share is only 7% and Nissan’s is 6%.
Like a few other major global automakers, Toyota has also been forced to cut output due to the chip shortage and lockdown measures that have slowed component production at factories in Malaysia and Vietnam, even as vehicle demand around the world rebounds from a pandemic slump, reports Reuters.
According to an AFP report, the world's top-selling automaker now projects a net profit of 2.49 trillion yen ($21.8 billion) for the fiscal year to March 2022, up from an earlier estimate of 2.3 trillion yen.
But it left its annual sales forecast unchanged at 30 trillion yen.
"Production volume declined globally, but our suppliers, plants and dealers made great efforts to supply as many cars as possible," the Japanese giant said.
"Even if we operate our plants at full capacity from December it will be tough to meet the production target, but we will try to achieve that," Chief Financial Officer Kenta Kon told a news briefing.
For the July-September second quarter, net profit jumped 33.2% to 626.7 billion yen on sales worth 7.5 trillion yen, which was up from 6.8 trillion yen a year before.
Toyota bounced back quicker than its competitors from the impact of Covid-19 lockdowns, reclaiming the top spot for sales last year.
As a result, Toyota cut output by some 550,000 units in July-September and will continue reducing production during the current quarter.
It also announced a share buyback of up to 150 billion yen or 0.86% of shares and hiked its first-half divided by 15 yen to 120 yen.
Although Toyota stuck to the production goal it announced in September, it lowered its full-year sales target by 260,000 vehicles to 10.29 million units.
Toyota's vehicle sales edged up 0.9% in the second quarter to 1.9 million units, as sales in Asia jumped 24%, while sales decreased in most other markets including Japan, North America and Europe.
In general, though, car demand in key markets, such as China, the United States and Europe is rebounding following an earlier pandemic-induced slump, with demand for electric vehicles (EVs) in particular seeing healthy growth.
Though the Bangladesh car market is small in comparison to our neighbouring countries, the numbers are gradually rising as more people can afford private transport compared to a decade ago.
The established brand name in the market suggests that the new buyers are likely to opt for Toyota as their name often is synonymous with reliability.
As mentioned previously about the huge market share that Toyota enjoys, any increase in price or production cuts can have a significant impact on the Bangladeshi car market.