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Toyota posts first loss in 5 years on slow sales

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Toyota posts first loss in 5 years on slow sales

Toyota Kirloskar Motor posted its first loss in the five years in fiscal 2021, as the maker of the Innova and Fortuner sold fewer vehicles in the pandemic-hit year that also saw an increase in costs.

This was the third consecutive year when the local unit of Japan‘s Toyota Motor recorded a lower bottom line on year, even as it rejigged business plans that include cross-badging vehicles with Maruti Suzuki in India.

Toyota

posted a net loss of ₹55 crore for the year ended March 31, compared with a net profit of ₹187 crore the year before, according to the company’s filing with the Ministry of Corporate Affairs, shared with ET by business research platform Tofler. Revenue dropped 16% to ₹13,181 crore.

The fall in sales, elevated fixed cost and lower margin on the products sourced from Maruti Suzuki weighed on the operating margin, which shrank to 1.97% from an average of 7.13% for the previous four years. Operating profit per car dropped to ₹27,832, which was 25% less compared with that of local market leader Maruti Suzuki.

At its peak, Toyota Kirloskar’s profit per vehicle was ₹1.39 lakh, in FY17. That was nearly double that of Maruti Suzuki at the time.

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