Connect with us

Business

‘Unprecedented’ raw materials costs could cut profits by 20pc, Toyota warns

The global automotive industry has been battling supply chain problems for roughly a year and a half

Published

on

‘Unprecedented’ raw materials costs could cut profits by 20pc, Toyota warns
GNN Media: Representational Photo

Toyota Motor on Wednesday warned investors that “unprecedented” increases in materials and logistics costs could cut the company’s full-year profit by as much as 20%.

The Japanese automaker said it expects materials costs to more than double to 1.45 trillion yen, or about $11.1 billion, in its fiscal year that started in April. Toyota said it plans to offset about 300 billion yen, about $2.3 billion, of those year-over-year increases through “cost reduction efforts.”

The global automotive industry has been battling supply chain problems for roughly a year and a half. A global shortage of semiconductor chips has sporadically shuttered factories and caused significant reductions in vehicle volumes.

Toyota was able to navigate the supply shortages better than some other automakers during the early days of the chip shortage, but higher inflation, increased costs and additional supply chain problems have added up.

Covid-19 continues to be a problem as well. Toyota on Tuesday said it would suspend operations on 14 lines at eight domestic factories for up to six days in May due to lockdowns occurring in China.

Toyota expects its operating profit to slip to 2.40 trillion yen ($19.7 billion) for the current fiscal year, down from 3 trillion yen ($22.9 billion) in its last fiscal year that ended in March. It also forecast net income to fall by 20% to 2.26 billion yen ($18.5 billion), despite expectations of record global retail sales during that time.

“It is very unprecedented,” Toyota Chief Financial Officer Kenta Kon said Wednesday about the raw materials costs.

Kon said the company is working internally and with its suppliers to cut costs as much as possible to avoid “simply raising the prices” of its vehicles for consumers. He said that could include using fewer raw materials or switching to lower-priced parts.

“We have a sense of crisis, and we do realize we have to continue these efforts,” Kon said.

Toyota is the latest automaker to warn of rising costs. Tesla CEO Elon Musk has blamed inflation in raising the prices of its electric vehicles. General Motors and Ford Motor also have warned of significant cost increases this year.

Ford said it largely expects its pricing power, combined with an expected increase in production, to offset $4 billion in raw material headwinds. The automaker previously forecast those headwinds at $1.5 billion to $2 billion. It’s a similar story at GM, which last month doubled its forecast commodity costs to $5 billion in 2022.

SOURCE: CNBC

Faisal Ali Ghumman

Mr. Ghumman is a seasoned journalist who has 19 years of diversified experience in print, electronic and digital media. He has worked with 92 News HD, Daily Pakistan Today, Daily The Business, Daily Dawn, Daily Times and Pakistan Observer as News Reporter, Feature Writer, Editor, Web Content Editor and Article Writer. Mr Ghumman has graduated from the Bahauddin Zakariya University Multan and is currently enrolled in M.Phil in Mass Communication at the University of Punjab.

World

Death toll from Iran tower block collapse rises to 18

The number of people still trapped under the rubble remains unclear.

Published by Mehak Javed

Published

on

Death toll from Iran tower block collapse rises to 18

Tehran: Iranian authorities announced Thursday that 18 people were killed in the collapse of a building under construction in southwestern Iran, in a new toll after four days of the tragedy. 

On Monday, a large part of the 10-storey "Metropol" building under construction collapsed in Abadan, one of the main cities in Iran's Khuzestan province. The building is located in the middle of one of the busiest streets in the city of 230,000 people.

The number of people still trapped under the rubble remains unclear.

The cause of the collapse, which occurred during a sandstorm, is yet to be ascertained. 

Police, however, arrested the owner of the building and the project manager of the construction company that built it.

Continue Reading

Pakistan

SC dismisses govt’s contempt of court plea against Imran Khan

The government filed the plea against PTI this morning

Published by Siddra Sumreen

Published

on

SC dismisses govt’s contempt of court plea against Imran Khan

Islamabad: The Supreme Court of Pakistan has refused to take contempt of court action against PTI Chairman Imran Khan for violating the apex court’s orders during ‘Azadi March’.

The government filed the plea this morning after the PTI openly defied the apex court’s directives, announcing to hold a rally at D-Chowk in Islamabad’s prohibited Red Zone.

The SC formed a five-member larger bench, headed by Chief Justice Umar Ata Bandial, to hear the contempt of court plea At the outset of the hearing, Attorney-General of Pakistan Ashtar Ausaf read out the SC verdict before the court.

The court dismissed a petition filed by the federal government, saying that activists were not responsible as they act on the directives of party leadership. It also ordered the release of 20 activists who were booked for rioting and violence.

However, following the reports of violence and mayhem during the protest brought before the Court, the Court has now decided to issue a comprehensive order after pondering over the matter keeping in view the nature of assembly and association so that it can serve as a guideline to the practice of constitutional rights in future.

The Court observed that fundamental rights of assembly, association, and movement are not unlimited, but there are certain limits to them.     

At the outset of the hearing today, Attorney-General of Pakistan, Ashtar Ausaf Ali presented his submissions before the Court pointing out the violations of the Court's order by PTI.

He also mentioned before the court the breach of allowed venue and entering the D-Chowk by PTI workers, burning public property and trees, injuring the security forces personnel, and creating turmoil in the federal capital.

Continue Reading

Sports

Former Pakistan Pacer Umar Gul Appointed Bowling Coach

The 37-year-old is widely regarded as one of the finest pacers, particularly in T20 cricket

Published by Siddra Sumreen

Published

on

Former Pakistan Pacer Umar Gul Appointed Bowling Coach

Kabul: Afghanistan Cricket Board (ACB) has appointed former Pakistan speedster, Umar Gul, for a period of one year. Gul’s first assignment with the Afghanistan side will be on their limited-overs tour of Zimbabwe next month.

The former pacer has earlier worked with the board as a bowling consultant for their three-week training camp held in Dubai in April alongside mate Younis Khan as the batting coach.

However, on seeing his performance with the team, ACB is delighted to announce the extension in the role.

This will be Gul’s first coaching assignment in international cricket after serving as the bowling coach of Quetta Gladiators in the 2021 season of the Pakistan Super League (PSL).

The 37-year-old is widely regarded as one of the finest pacers, particularly in T20 cricket. Gul had an exceptional record in T20Is as he picked up 85 wickets at an average of 16.97 and an economy rate of 7.19 in 60 matches in a T20I career spanning almost 9 years. Gul retired from all forms of cricket in 2019 and has since worked as a coach.

The former pacer has previously coached in Pakistan’s premier T20 tournament, Pakistan Super League (PSL), as a bowling coach for Quetta Gladiators. He has also worked as a coach in the Kashmir Premier League (KPL) and was the head coach of Galle Gladiators in the previous edition of the Lanka Premier League (LPL).

Continue Reading

Trending