Analysts forecast Toyota to exceed GM’s earnings next fiscal year

Article by Eugene Conan, on May 8, 2012

Analysts expect Toyota Motor Corp. to post its largest profit in five years and surpass General Motors Co.'s earnings this incoming fiscal year. According to the average of 21 analyst estimates compiled by Bloomberg News, Toyota may triple its net income to JPY817.7 billion for the fiscal year ending March 2013, which beats GM’s expected profit for the next four quarters. 

High expectations on Toyota fiscal performance have been well-founded on the fact that the Japanese carmaker has resolved its supply and production problems in 2011 after having suffered because of the natural disasters that hit Japan in March last year. With these problems under full control, Toyota is primed to regain the market share it lost in 2011.

The company, led by Akio Toyoda, is launching new Prius hybrids, Corolla compacts and Lexus sedans to attract customers it lost to competitors last year. However, the biggest problem that Toyota has to overcome this year is in fending off its fierce rivals, including world no. 1 GM, fast-rising Hyundai Motor Co., and an emergent Volkswagen AG.

Mitsushige Akino of Ichiyoshi Investment Management Co. in Tokyo said that 2012 will be a test year for Toyoda because the success of business strategies of company chief can only be manifested when there are “no irregular factors," Akino added that everybody is looking forward to how Toyota’s president could narrow the gap between the company and GM. Toyota’s shares has been showing signs of revival this year as it gained 21 percent in Tokyo trading.

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