Toyota posts $5.4 billion quarterly profit, raises forecast

Toyota is among a dozen or so auto makers recalling altogether tens of millions of vehicles loaded with potentially rupture-prone Takata Corp.-made air bags, which have been linked to 10 deaths.

Toyota’s quarterly profit rose almost 5 percent as the weaker yen and costs reductions offset declining sales in some markets.

It maintained the outlook for fiscal 2015 operating profit and sales unchanged, respectively, at 2.8 trillion yen, up 1.8 percent, and 27.5 trillion yen, up 1.0 percent.

Net income in the quarter rose 4.7 percent to 628 billion yen ($5.4 billion).

A stabilising yen against the USA dollar following months of deep losses, along with an appreciation in the Japanese currency against the euro and other currencies weighed on the company’s third-quarter operating profit, which fell 5.3% from the previous year to ¥722bn yen.

Elsewhere on Friday, Sweden’s Volvo posted a 34% increase in annual adjusted operating profit to 4.57bn krona (£370m), but the figure missed analysts’ expectations. “This is why we’ve raised our profit forecast”, Managing Officer Tetsuya Otake said, according to Reuters.

It expects 2.87 million vehicle sales in North America for the full year.

While a sharp fall in the Japanese yen versus the US dollar in recent years has boosted profitability, Toyota said its impact has started to subside.

The Japanese firm sold 10.15 million vehicles across the globe past year, staying ahead of Volkswagen as the world’s top auto maker as the German company’s sales were hit by the diesel emissions cheating scandal. The new forecast represents a 4.4 percent increase from the previous year.

In Japan, Toyota is set to halt plant operations next week due to a parts shortage, after an accident at a steel supplier.

The company said it had yet to factor in any possible impact into its earnings.