Just a few days ago, Toyota Motor Corp announced a new forecast for its operating profit. As per the details, the operating profit is expected to increase by 10% this year.
Similarly, the car manufacturer is also expecting an x5 increase in the sales of pure EVs. Now that the issue of global chip shortage is fixed, the x5 target has started to look achievable after all.
Electrification Drive At Toyota Motor Corp
The latest growth plan was announced by Koji Sato, who is the new CEO of Toyota Motor Corp. This also signals the company's willingness to pursue an all-electric route.
Previously, the company was following a go-slow approach when it came to the EV market. But after the recent bullish target, it appears that things have started to change at Toyota!
According to Toyota, it expects to sell 202,000 battery EVs by the end of March 2024. If we look at last year's target of 38,000, that's a fivefold increase!
Overall, the operating profit forecast set by Toyota is $22.2 billion or 3 trillion yen for the current business year. If we look at the analysts, they are expecting an operating profit of 3.02 trillion yen.
The earlier strategy of Toyota was not good enough to perform in China, which happens to be one of the biggest auto markets in the world.
In fact, the earlier strategy weakened the dominant position of Toyota and made way for local brands like BYD Co to fill the gap through its EVs.
If we look at Toyota, it was focusing more on the hybrid model, but it appears that the market demand is for pure EVs! That's one of the reasons why Toyota has decided to work on both pure EVs as well as hybrid vehicles.
After the earnings release and the recent forecast, Toyota shares jumped 2.5%, only to eventually close the day with 0.8% gains.