Lower revenues from North America
Toyota Motor’s (TM) vehicle sales in North America stood at 2.8 million units in fiscal 2017 (April 1, 2016, to March 31, 2017), which was similar to sales in the previous fiscal year. With this, the company’s revenues from the region fell to 10.2 trillion yen in fiscal 2017, about 7.4% lower than fiscal 2016. Now, let’s take a closer look at Toyota’s performance in North America in its last fiscal year.
Demand for trucks and SUVs
In the last couple of years, the US demand for trucks and SUVs (sports-utility-vehicles) has outperformed the demand for small cars. This higher demand for SUVs and trucks also continued to benefit Toyota in North America. In the SUV category, the demand for Toyota’s SUV models such as RAV4 and Lexus NX were stable from North America.
However, its North America revenues in fiscal 2017 were negatively affected by a weaker US dollar against the yen as compared to fiscal 2016.
Last year, other major automakers (VCR) such as General Motors (GM), Ford (F), and Fiat Chrysler (FCAU) also have benefitted from higher demand for their heavyweight vehicles. This ongoing trend in US auto sales has helped these companies improve their profitability because heavyweight vehicles tend to have higher margins than other lightweight vehicles.
Higher sales in Europe and Asia
In Europe, Toyota’s vehicle sales went up 9.6% YoY (year-over-year) in fiscal 2017 to 0.92 million units. Similarly, in Asia (excluding Japan), the company’s vehicle sales rose significantly by 18.1% YoY to 1.6 million in the last fiscal year compared to 1.3 million in fiscal 2016.
Continue to the next part to learn how Toyota’s margins were in fiscal 2017.