NEW YORK—Toyota Motor Corp. posted a net profit of 153.2 billion yen (US$1.68 billion) in the last quarter ended Dec. 31, 2009, which beat Wall Street analyst estimates. The quarter included a portion of the company’s recent massive safety recall.
Toyota sold 2.07 million cars in the last quarter, 227,000 more than the same period in 2008.
The increase was, “A result of customer appreciation of our strength in offering a wide range of environmentally friendly vehicles,” said Senior Managing Director Takahiko Ijichi in a statement.
But the current quarter, which ends in March, may not be kind to Toyota. The Japanese automaker—the world’s largest—is undertaking a massive recall of vehicles to fix accelerator pedals that could be stuck while driving. Almost 8 million vehicles are affected globally in separate safety recalls.
This week, an additional safety concern surfaced regarding issues related to brakes on the Toyota Prius, the company’s best-selling hybrid vehicle.
“Nothing is more important to us than the safety and reliability of the vehicles our customers drive,” the company said in a released statement on Thursday. “Since these issues first came to our attention, we have understood that the soonest possible action would be in the best interests of our customers and have acted accordingly.”
All told, the negative publicity related to the recalls has hit Toyota’s reputation immensely. Once considered one of the top automakers in the world in reliability and quality, Toyota has seen its market capitalization drop by $30 billion, by Reuters estimates.
“With its tarnished image,” S&P said in a research note, “We now recommend a cautious approach.“
The recent recalls have already put a dent in Toyota’s January U.S. sales, which fell 16 percent—to less than 100,000 vehicles sold for the first time since 1999—to third place behind General Motors Co. and Ford Motor Co.
“I am in no way certain that Toyota’s explanation for the cause of incidents of sudden acceleration in its vehicles satisfies me,” said Rep. John Dingell, a politician from Michigan and a proponent of the U.S. auto industry.
Toyota sold 2.07 million cars in the last quarter, 227,000 more than the same period in 2008.
The increase was, “A result of customer appreciation of our strength in offering a wide range of environmentally friendly vehicles,” said Senior Managing Director Takahiko Ijichi in a statement.
Pedal Woes
But the current quarter, which ends in March, may not be kind to Toyota. The Japanese automaker—the world’s largest—is undertaking a massive recall of vehicles to fix accelerator pedals that could be stuck while driving. Almost 8 million vehicles are affected globally in separate safety recalls.
This week, an additional safety concern surfaced regarding issues related to brakes on the Toyota Prius, the company’s best-selling hybrid vehicle.
“Nothing is more important to us than the safety and reliability of the vehicles our customers drive,” the company said in a released statement on Thursday. “Since these issues first came to our attention, we have understood that the soonest possible action would be in the best interests of our customers and have acted accordingly.”
All told, the negative publicity related to the recalls has hit Toyota’s reputation immensely. Once considered one of the top automakers in the world in reliability and quality, Toyota has seen its market capitalization drop by $30 billion, by Reuters estimates.
“With its tarnished image,” S&P said in a research note, “We now recommend a cautious approach.“
The recent recalls have already put a dent in Toyota’s January U.S. sales, which fell 16 percent—to less than 100,000 vehicles sold for the first time since 1999—to third place behind General Motors Co. and Ford Motor Co.
“I am in no way certain that Toyota’s explanation for the cause of incidents of sudden acceleration in its vehicles satisfies me,” said Rep. John Dingell, a politician from Michigan and a proponent of the U.S. auto industry.
