Toyota Motor Corp. released its earnings for financial year 2020 ending March 31 and predicted annual profit for 2021 would drop by 80%. The COVID-19 pandemic has wiped out global appetite for transportation and led to negative impacts in the billions for other carmakers.
According to the earnings report, consolidated vehicle sales were 8.9 million units, down 18,000 from the previous year. Net revenues for the financial year were $278.9 billion, a decrease of 1% from the year before, and operating income fell slightly to $22.7 billion. Total income before taxes was $23.8 billion as net income increased from $17.5 billion to $19.35 billion.
Unlike fellow automakers Honda, General Motors, and Ford, Toyota issued a prediction for next year’s performance: Toyota expects consolidated vehicle sales for the new financial year ending March 31, 2021, will be 7 million units, and that operating income will be $4.6 billion. That predicted loss between $22.7 billion in 2020 and $4.6 billion in 2021 would represent an 80% year-over-year drop in Toyota operating income.
At a media briefing, President of Toyota Akio Toyoda said the virus “has dealt us a bigger shock than the 2008 global financial crisis."
Over the course of the year, operating income fell by $229.2 million, owing in part to currency fluctuations worth $2.84 billion. According to Operating Officer Kenta Kon, the spread of COVID-19 led to a decrease in net revenue of $3.5 billion and a loss of $1.4 billion in operating income.
The spread of COVID-19 has wreaked havoc on global transportation, with automotive and aerospace industries reeling from a lack of demand from their products. Automakers around the globe are reporting weak sales as quarantine orders keep workers home and out of their cars.
