Toyota Australia Reports Third Straight Annual Loss
Executive Summary
The Japanese and Thai natural disasters had an unprecedented effect on production volume and reduced sales, but the auto maker nevertheless remains Australia’s best-selling vehicle brand by a wide margin.
Toyota Australia reports Japan’s earthquake and tsunami combined with Thailand’s massive floods to wash away A$1 billion ($1.01 billion) in sales in the fiscal year ended March 31, resulting in an after-tax loss of A$32.6 million ($33.2 million), more than double the A$13.2 million ($13.4 million) loss the previous year.
The auto maker says the two natural disasters had an unprecedented impact on the company and resulted in a limited supply of vehicles and parts for most of 2011. It says it responded with a range of measures to limit the impact on customers and revenue.
Total revenue for the last fiscal year was A$7.25 billion ($7.38 billion), down 12.3% from prior-year’s A$8.27 billion ($8.42 billion), while domestic sales of both Toyota and Lexus vehicles totaled 187,328 units, down 13.8% from 217,365.
It was the Australian subsidiary’s third straight annual loss. Despite the drop in sales, Toyota remains the country’s best-selling vehicle brand by a wide margin.
The auto maker produced almost 94,000 vehicles in Australia during fiscal 2012, down from 113,333 units in the prior year. Best-selling HiLux pickups are imported from Thailand.
May deliveries soared 85.1% from the disaster-skewed prior-year month, and were up 16.2% through the first five months of this year. Toyota Australia President and CEO Max Yasuda says the auto maker has met recent challenges, but more lie ahead.
“Toyota Motor Corp. responded well during this time, and here in Australia we were able to maintain our workforce during the tough conditions with the support of our suppliers and strong dealership network,” Yasuda says in a statement.
“We have also had to deal with other external pressures including intense market competition, currency impacts and the cost of raw materials,” he says.
“While we cannot control external factors like natural disasters or the strong Australian dollar, there are things we can do to make Toyota Australia leaner and stronger to create sustainable and profitable business operations.”
Reducing the workforce by 350 people in recent months was a difficult decision to make but critical if Toyota is to grow, Yasuda says. The auto maker is aiming for an improved profit this fiscal year.
“We are expecting the release of…new vehicles will translate to an increase in sales and solidify Toyota's position as the No.1 automotive brand in Australia,” he says.
The auto maker will commission a new plant to manufacture 4-cyl. and hybrid engines at Altona outside Melbourne at the end of this year. The federal government is giving A$63 million ($64.2 million) toward the cost of the plant, while the Victoria state government is providing an undisclosed amount.
