Toyota Surges on Upbeat Outlook, China EV Plans
Tokyo, Japan - Toyota Motor Corporation (TM) shares surged on Friday following the company's upbeat fiscal third-quarter results and announcement of plans to establish a wholly-owned EV unit in China.
Robust Earnings
Toyota reported fiscal third-quarter revenue of 12.39 trillion yen ($80.95 billion), a 2.9% increase year-over-year. Despite lower vehicle sales, net profit surged 62% to 2.19 trillion yen ($14.21 billion), surpassing analyst estimates of 1.17 trillion yen.
Optimistic Outlook
Citing "strengthening earnings power" and "product competitiveness," Toyota raised its full-year fiscal 2025 profit forecast to 4.7 trillion yen ($31 billion), up from the previous outlook of 4.3 trillion yen.
China EV Ambitions
Toyota announced plans to establish a wholly-owned company in Shanghai for the development and production of Lexus EVs and batteries. Production is expected to start in 2027, with an annual capacity of 100,000 vehicles.
Insulating from Tariffs
Toyota's decision to localize EV production in China and the US reduces the company's exposure to trade-related tariffs. The new US battery plant in North Carolina will produce batteries for hybrid and electric vehicles sold domestically.
Market Outlook
Analysts remain optimistic about the long-term demand for EVs, despite potential changes in tax incentives. Toyota's investments in China and the US position the company for continued growth in the global EV market.