Toyota Surprises With Profit, Boosts Forecast

Toyota vehicles are displayed at the D. Longo Toyota dealership in El Monte, Calif., Wednesday,...

Toyota vehicles are displayed at the D. Longo Toyota dealership in El Monte, Calif., Wednesday, Nov, 4, 2009. The clunkers program was very good for D. Longo Inc., a large Toyota dealer just east of Los Angeles, which sold more than twice as many vehicles under the program as any other dealership in America, worth more than $30 million. (AP Photo/Nick Ut)

(AP)

Toyota Motor Corp. announced Thursday a surprise profit last quarter and trimmed its projected red ink for the year, underlining the gradual recovery under way for Japan's giant automakers.

The world's largest car company attributed the unexpected profit — its first after three losing quarters — to government measures around the world designed to boost sales of environmentally friendly cars and other vehicles.

It was the latest in a string of healthier reports and forecasts from rivals like Honda Motor Co. and Nissan Motor Co., adding to growing evidence that carmakers are starting to rebound after being battered by the deepest industry downturn in years.

For the July-September quarter, Toyota reported net income of 21.8 billion yen ($242 million), bucking some analyst expectations of another loss.

The result marked an 84 percent plunge from the 139.8 billion profit racked up during the same period a year ago, but was still an encouraging sign after the company posted its biggest loss ever in the last fiscal year.

Toyota said it now expected to sell more vehicles for the fiscal year through March 2010, raising its projections to 7.03 million vehicles from 6.6 million.

The revised forecast still marks a 7 percent drop from the more than 7.5 million vehicles Toyota had sold around the world in the last fiscal year, though sales were growing in Japan and the rest of Asia compared to a year ago. Like other Japanese car companies, Toyota is benefiting from solid demand in China, an auto market on track to become the world's biggest, replacing the U.S., this year.

The company, which makes the Prius hybrid and the Corolla subcompact, said sales in the last six months were proving better than earlier expectations as government efforts to attract more buyers spur global demand.

As a result, Toyota forecast a smaller loss for the fiscal year of 200 billion yen ($2.2 billion) — less than half the 450 billion yen ($5 billion) of red ink it had predicted earlier.