As Toyota Motor Corp. recovers from the daunting recalls in North America, it predicts that profit will increase by 48% this fiscal year. Aside from expecting a recovery in North America (its biggest market), the company also forecasts that sales will increase in Japan as well as in other parts of Asia.
In a statement, Toyota said that for the fiscal year that ended last March, net income may rise to 310 billion yen ($3.35 billion) from 209 billion yen a year earlier.
In April, its US sales increased by 24% as incentives raised the demand for its Corolla and Prius models and offset the impact of recalls of over 8 million vehicles worldwide for flaws linked to unintended acceleration. Toyota also forecasts that its North American sales will rise by 1.5% this fiscal year to 2.13 million vehicles.
When it comes to Toyota's earnings for this year, "North America is the only market that matters," according to Gentoku Kiyokawa, a fund manager in Tokyo at Fortis Investments, which bought Toyota shares last February.
He added that based on the latest sales figures, the recalls aren't causing much of a problem. As sales in the car industry fell 21% to 10.4 million units (its lowest since 1982), Toyota's US sales fell by 20% in 2009. Soon after the company launched discounts and other incentives across its lineup, sales in the US increased by 41% in March.