Toyota's profit target: US $12 billion
Expansion into "emerging markets" expected to raise profit to one trillion yen by 2015Toyota has revealed ambitious plans for its future profitability. In a report by business media group Bloomberg, the Japanese company has committed to achieving its goal of posting a profit of one trillion yen (US $12 billion) by 2015.
To do so, Toyota will shake up its management structure, introduce 10 new hybrid models and focus more energy on developing business within emerging markets. The report quoted Toyota President Akio Toyoda at length in the week prior to the earthquake and tsunami that devastated the north of Japan.
Since the natural disaster, Toyota has announced in response that production in all Japanese plants had been halted and the likely effect would be a 40,000-unit shortfall in production for the year. But it seems unlikely that the disaster will have long-term impact on the company's plans to achieve the new profit target -- not when the target is contingent on building nine million cars per annum. 15 per cent of that number is anticipated to be sold in China, the fastest growing market in the world and currently the largest market for domestic automotive sales since overtaking the US two years ago.
Up to this point, 60 per cent of Toyota's profits have come from North American sales, but, Bloomberg reports, bad publicity for Toyota around the world and particularly in the USA has constrained profit, relative to archrival Honda. Toyota posted a profit in the last financial year of 550 billion yen, based on selling 7.5 million cars around the world. But to put that profit in perspective -- and also to illustrate how far the company's profit had fallen during the Global Financial Crisis -- profit in 2007 was 2.27 trillion yen. In the post-GFC world, Toyota is anxious to dole out its eggs to more 'emerging' baskets over the next few years.
"We will focus on emerging markets and environmental vehicles," President Akio Toyoda said during a Tokyo press conference reported by Bloomberg. "We will decide when and how much to increase capacity in emerging markets if we need to."
As part of his 'Global Vision' plan, Toyoda announced the small Etios model for India at the end of this year, followed by launches in China, Thailand and Brazil.
Picture: Akio Toyoda standing alongside the FT86 sports car at the 2009 Tokyo motor show.
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