Toyota jacks up profit forecast to 54%, says chip supply not yet an issue

Toyota Motor Corp boosted its full-year earnings forecast by a bigger-than-expected 54 percent, saying it has an up to four-month stockpile of chips and was not immediately expecting a shortage to hit production.

The Japanese automaker also increased its forecast in the number of vehicles it would sell this year by 3.3 percent from 9.42 million to sell 9.73 million, which is still below last year’s 10.46 million.

Toyota also expects an operating profit of $19.13 billion for the fiscal year ending March 31, which is far higher than the previous projection of 1.3 trillion yen and the average 1.542 trillion yen estimated profit forecast from 23 analysts.

According to its Chief Financial Officer Kenta Kon, Toyota is not expecting a decrease in production volume due to the chip shortage in the near term and raised its output for the fiscal year ending March.

However, it does see chip shortage risks.

Other automakers, including Japanese rivals Nissan Motor Co Ltd and Honda Motor Co Ltd, have to cut production because of semiconductor shortages.

Global chip shortages might continue until the summer, though Toyota feels that the situation might be resolved earlier.