The beginning of November every year is the day for Japanese car companies to release the results of the second fiscal quarter (July-September 2024) in March 2025 (April 2024-March 2025).
Lengthening the timeline and longitudinally observing the Japanese financial reports of the past few years, the main theme is basically “several joys and sorrows”.
Because in most of the time, even if there are several car companies with unsatisfactory results, Toyota, as the Japanese big brother, can gain a firm foothold in the core dimensions such as profits, helping the Japanese camp to “win back a game.
” Only this time even Toyota’s net profit fell by as much as 55% from a year earlier.
According to the data, other Japanese manufacturers also have their own worries, and Nissan announced that it had cut global production capacity by 20 per cent and cut 9000 jobs after the results were made public.
Toyota: I’m just a minor scratch.
Toyota’s operating income from July to September was 11.
44 trillion yen, which was basically the same as that of last year, and its operating profit was 1.
16 trillion yen, down 20% from the same period last year.
The biggest fluctuation was net profit, which totaled 573.
7 billion yen.
Compared with 1.
28 trillion yen in the same period last year, it decreased by half.
Operating profit, in particular, fell 20% year-on-year in the quarter, below market expectations, and it was Toyota’s first quarterly operating profit decline in the past two years.
Judging from the results of the half-year (April-September 2024), Toyota’s operating income in the first half of the year was 2.
328 billion yen, up 5.9%. operating profit was 2.
46 trillion yen, down 3.
7% from the same period last year.
and net profit was 1.
9 trillion yen, down 26.4%. However, Toyota’s operating profit in the first half of the year is still more than 2 trillion yen, although there has been a decline, but this result is second only to the highest profit in history set last year.
Moreover, as the most profitable car company in the world, Toyota’s bicycle profit is still as high as 226000 yen and its gross profit margin is still more than 20%.
In terms of sales Toyota’s global new car sales reached 4.
556 million in the first half of the year down 4 per cent from the same period last year.
It is worth mentioning that the proportion of sales of electrified models (including hybrid, pure electricity, etc.
) has increased to 44.
4% from 35.
3% last year.
Global sales in the July-September quarter were 2.
537 million, down 3.
6 per cent from 2.
634 million in the same period last year.
In terms of production, Toyota’s global production fell in the first half of the year for the first time in four years, producing a total of 4.
71 million vehicles, down 7 per cent from a record 5.
06 million in the same period last year.
Toyota Vice President Yoichi Miyazaki revealed at the earnings conference that the reason for the halving of net profit was mainly due to the suspension of production caused by certification violations.
At the beginning of this year, Toyota subsidiary Dafa was exposed for fraud and illegal practices, which directly affected Toyota’s follow-up production and shipments.
“in this regard, Toyota needs some time to re-examine its manufacturing environment and culture.
” In the following half of the fiscal year, the company will give full play to Toyota’s unique manufacturing base and product advantages to resume normal production.
” In Japan production of best-selling models such as the Yariss Cross and Corolla Fielder stalled due to certification violations and Toyota’s global sales were also affected by the Prius recall in the United States.
However, according to the official release, the decline in profits in the past quarter is only a “small scratch” and Toyota is still confident about the overall market for the whole fiscal year.
Taking into account practical factors Toyota’s production forecast for the March fiscal year 2025 was cut by 300000 vehicles from the previous 10 million to 9.
7 million.
In addition, Toyota maintained its full-year operating profit forecast of 4.
3 trillion yen and raised its full-year dividend forecast to 90 yen from 75 yen last year.
Nissan: the tough battle is still going on.
Four years ago, when the COVID-19 epidemic reached its peak, Nissan launched a series of management reforms after a major change of blood at the top.
In the face of financial deficits in difficult times, the Yomiuri Shimbun published a comment entitled “continued decline in sales”, saying that “if Nissan fails to take a key step in electrification transformation, it will continue to face more difficult difficulties.
” The Nippon Keizai Shimbun also pointed out in its article “there is a long way to go” that even if the new regime launches drastic reforms, it will take a year and a half at the earliest to take effect.
However, what Nissan management did not expect is that the haze of the epidemic has dissipated, but the company has launched a new round of “emergency recovery model.
” Along with the first-half results, Nissan recently announced a cut in its annual profit forecast and plans to cut 9000 jobs and cut production capacity by 20 per cent.
In the second quarter of this year (July-September) Nissan posted a net loss of 9.
34 billion yen and an operating profit of 31.
91 billion yen.
Taking into account the general environment of the car market in the second half of the year, as well as the global competition situation, Nissan lowered its operating profit forecast for the whole fiscal year to 150 billion yen from the original 500 billion yen.
To this end, Nissan CEO Cheng Uchida announced that he would voluntarily cut his monthly salary by 50% from this month, and that other executives would also voluntarily cut their salaries.
To boost its available confidence, Nissan will also reduce its stake in Mitsubishi Motors to about 24% from the current 34%.
Japanese media wrote that one of the reasons for Nissan’s poor performance was that the management culture since former chairman Carlos Carlos Ghosn had not changed, and top-down bureaucracy, such as “waiting for instructions”, remained deep-rooted and unable to cope with drastic changes in the industry.
In the short term the plight of the North American market has further deepened Nissan’s downturn.
In the North American market, sales of pure electric models are slowing, while sales of hybrid vehicles are growing.
Nissan, which previously gave priority to pure electric models in North America, is now very competitive.
According to Nissan’s 10 best-selling models in the United States, only one new car was released in 2022 and 2023, and the number of best-selling models decreased due to delays in new car updates, resulting in a monthly sales of more than 1000 cars.
it has fallen from 19 in 2014 to 12 now.
As there is a shortage of hot-selling new models and pure electric models face sales resistance Nissan has no choice but to rely on sales incentives and subsidies after price cuts leading to a sharp drop in profits.
President Mr.
Uchida explained that one of the challenges facing Nissan is that it is unable to achieve its established sales plan.
It is undeniable that the market is changing rapidly and our plan is too cautious.
In order to change the management system of the Ghosn era, Uchida revealed that in 2025, Nissan’s management structure will be reformed in January and April, so as to be able to respond quickly to changes in the business environment.
“We will clarify the role of the head office and regions to make it a lean organization and efficient process body.
“, , Honda: North America is still a “cash cow”, Honda Motor’s second-quarter financial report showed that the company’s operating profit was 257.
9 billion yen, lower than the previous market estimate of 431 billion yen, and its net profit was 100.
02 billion yen, lower than the previous market estimate. 297.31 billion yen.
In the first half of the fiscal year (April to September 2024), Honda’s consolidated operating income was 10.
79 trillion yen, a year-on-year increase of 12.4%. operating profit was 742.
6 billion yen, an increase of 6.6%. pre-tax profit fell 15.
6% year-on-year to 741.
9 billion yen.
Based on its results in the first half of the fiscal year, Honda raised its full-year revenue forecast, predicting that revenue for the full fiscal year will increase by 2.
8% year-on-year to 21 trillion yen, and operating profit will increase by 2.
8% year-on-year to 1.
42 trillion yen.
, , it can be seen that Honda’s performance in the first half of the year is still relatively stable.
Among them, sales of four-wheeled vehicles fell by 8.
0% year-on-year to 1.
779 million units, and sales of two-wheeled vehicles increased by 12.
0% year-on-year to 10.
382 million units.
Whether it is operating profit or net profit, the absolute strength of Honda’s two-wheeled business has always far exceeded the four-wheeled (automobile) business.
While profit margins in the automotive business continue to slump, Honda has become a manufacturer backed by its motorcycle business.
By market, Honda’s automobile business has increased sales in Japan and the United States, but in the China market, with the inner ring of new energy vehicle tracks and the increasingly fierce price war, Honda’s sales of new cars in China have declined.
It is worth mentioning that North America has always been Honda’s “profit cow”.
It is precisely this market that has become more stable that allows Honda to achieve remarkable results in the past six months.
Not only were sales of fuel vehicles and hybrid cars strong, but even pure electric vehicles increased by 64,000 compared with the same period last year.
In terms of the motorcycle business, despite the impact of Thailand’s economic slowdown, overall sales are still growing due to strong demand in India and increased sales due to the recovery of the economy in Vietnam.
However, although the United States is still Honda’s biggest cash cow, due to the impact of the Lehman crisis in 2008, demand in this market has shrunk by about 30% in recent years.
In addition, large cars are more popular in North America, but the car field that Honda is good at is shrinking.
There is limited room for growth in the North American market.
Honda has instead chosen to continuously expand its market presence in emerging countries.
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