Toyota reports profit drops in first quarter

Toyota announced today that its first quarter profits dropped by 28 percent to $3.2 billion caused by declining sales in U.S. and Europe, rising cost of raw materials and currency trends. Operating income for Toyota fell 38.9 percent to $3.9 billion.

Even though Japanese automakers are still making money, they have been affected by declining U.S. sales and a shift in demand from trucks and SUVS to smaller cars. Like GM and Ford, Toyota, Nissan and Honda have all been struggling to increase output of compact cars to meet the demand.

“Currently we can’t satisfy the order backlog for Yaris and Corolla,” Ijichi said. “Because of short supplies of batteries we’re not able to satisfy demand for Prius,” said Mitsuo Kinoshita, executive vice president at Toyota.

Toyota’s revenue fell 4.7 percent to $57 billion. U.S. sales fell 4 percent to 729,000 during the first 3 months of 2008.


Source: Detroit News