Full Year 2025 Toyota Motor Corp Earnings Call
[music].
Thank you Bill.
Good afternoon.
Welcome to Turkey.
Currently our financial results presentation. So we have some announcements about it doesn't mean distributor today.
It's a time to.
So we have just closed discretionary.
But today they are not distributed EBIT.
EBIT it will be shown on the screen.
You can download the material side.
Sorry towards the investment in this Josh inflammation and Cooper.
Thanks.
So please wait until we officially restart decision.
[music].
Okay.
Good morning, gentlemen, ladies and gentlemen, thank you very much for coming.
Schedule.
Speaker Change: Let's now start the financial results meeting for the year ending March 2025 will be the moderator for today. My name is the ETE from the public Relations Department.
Please go ahead.
Speaker Change: From EVP and Chief Financial Officer, you'll excuse me Jackie will give you the outline of the financial results.
Speaker Change: Okay.
Jackie: As usual on the unsecured <unk> closed on a 30 miles lately.
Jackie: I would like to express our heartfelt appreciation to customers around the world, who chose us as well.
Speaker Change: Shareholders dealers and suppliers.
Jackie: So towards us.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: So firstly I would like to tell you the summary.
Speaker Change: Income for the fiscal year ended March 'twenty to 'twenty, three with Grupo <unk> just high level operating income was issued to date checks of price revisions and expansion of the value chain.
<unk> financial Foundation is the value chain.
Speaker Change: <unk> comprehensive and just mentioned that led to the future and reinforcing out there Jim.
The Bar chart shows operating income by business.
Speaker Change: Station.
Compared to the fluctuating profit from new vehicles value chain profit such as those from parts and finance has been steadily expanding at a pace of 150 billion annually over the past several years.
Speaker Change: Operating income for the fiscal year, ending March 20, <unk> three eight trillion and we plan to reap the benefits of our efforts to reinforce our operational foundation, while continuing on this one is from a need to.
Speaker Change: Long term perspective.
Speaker Change: Shrinking our management Foundation, and some new Peanuts feature perfect. We do go to the Investor Day English only.
For the full year forecast shows that it will expand to more than two trillion yen.
Speaker Change: The impact of April and May $2025 two.
We plan to further enhance the value of our 150 million units in operation, which is our strength through expanding maintenance services strengthening our connection with finance and insurance by connected technologies as well as expanding the used car business and accessories business.
Speaker Change: <unk>.
Speaker Change: And for shareholders.
Speaker Change: Dividends for the fiscal year ended March 29, two yen.
Speaker Change: An increase of 15 compared to the previous fiscal year forecast full year dividend for fiscal year ended March 26 will be increased by five you looked at.
Speaker Change: This year, reaching 95, even in the face of what your current improvements will continue.
But in addition to this.
We will also leverage.
Speaker Change: Efforts to maintain our policy of a stable dividend increase that we wanted to.
Software defined vehicles and expand profit from new products and services created by working together with outside partners, who move into cities.
Speaker Change: Shareholders.
Speaker Change: Let me explain the details to the results for the fiscal year ended March.
Speaker Change: Consolidated vehicle sales for this fiscal year.
Speaker Change: 9.262 million unique feature with 99, 1% of consolidated vehicle sales for <unk>, Toyota and Lexus vehicles sales was $10 million 274000 units, which was 99, 7% of the search for the previous fiscal year due to supply constraints caused by the certification issue.
Jeff.
Speaker Change: Long term stable financial Foundation is the base of our agreement with vision.
Speaker Change: Inventing our path forward together.
Speaker Change: As a result of these efforts.
Speaker Change: We intend to expand and standardize earnings, especially in the asset business, which is less susceptible.
Speaker Change: Other factors can proportion of electrified vehicles 46, 2% a significant increase from our previous fiscal year, mainly by HEB.
Speaker Change: The go to market and economic conditions and achieve a business structure that allows us to reduce the amount of capital required to prepare for profit fluctuations.
Speaker Change: Increased by 850000 units from yes.
Speaker Change: Consolidated financial results sales revenues of 48, <unk> hundred 60, <unk> civil operating.
Speaker Change: On top of that we intend to increase the flexibility of our capital policy focusing on returns to shareholders, including such things as further acceleration of stable dividend increases.
Speaker Change: Operating income 14, 795 5 billion.
Speaker Change: JV income before income taxes of 300, and $414 5 billion and net income of 14 765 billion yes.
Speaker Change: And he was 20% towards set as an indicator to measure the progress of this transformation of our business structure and capital structure towards a mobility company.
Speaker Change: Yes.
Speaker Change: I would like to explain the factors, which impacted operating income year on year.
Speaker Change: From FY 2020 full results will have two U S. $352 9 billion, we excluded $362 90 Union of the one time favorite basics features attributable to market conditions and other factors several hundred billion yen for the comprehensive in distillates, resulting in the focus of a fortune 300 Pizza Inn at the Biggie.
Speaker Change: The next section explains shareholder returns.
Speaker Change: Okay.
Speaker Change: Our dividend policy is.
Speaker Change: The increase dividends in a stable and continuous matter manner in order to reward our long term shareholders.
Speaker Change: It's like 20 to 25, although there wasn't that from volume and model mix deterioration due to dissipation production that Toyota motor manufacturing here in the U S. The perfect amounted to <unk> 295, full time being due to improvements.
Speaker Change: And despite a decrease in profit for the fiscal year ended March 2025, we have decided to pay a full year dividend of 90 yen an increase of 15 young from the previous fiscal year as announced for the fiscal year ended March 2026, despite the difficulties.
Speaker Change: To price solutions controlling incentives and the expansion of our value chain projects.
Speaker Change: Anticipating the business outlook due to the impact of U S tariff impacts and other factors. The full year dividend forecast is 95 per share an increase of five young from the previous fiscal year.
Speaker Change: We believe that the.
Speaker Change: A major achievement.
Speaker Change: <unk> hundred 10 billion yen output of cost reduction efforts and marketing efforts when students.
Speaker Change: We have not yet year end share repurchase budgets, however, depending on the stock price levels and other factors and the need to respond to requests to sell our shares we will continue to flexibly implement share repurchases in the future.
Speaker Change: It's a comprehensive additionally, and different enforcement of operation of the foundation for the future such as he's touring the production to the current cruising speed of media.
Speaker Change: So thanks.
Speaker Change: It shows operating income by geographical region, Japan continued to maintain a high level perfect. Despite an increase in your expenses due to the strengthening of the supplier base.
Speaker Change: Lastly, Toyota alone cannot achieve structural reform of our business going forward.
Speaker Change: We will work together with our stakeholders.
Speaker Change: North America operating income decreased due to the factors such as the impact of lower production volume caused by the full months shutdown looked a little more time restructuring again.
Speaker Change: With their support and this concludes my explanation of the financial results.
Speaker Change: Due to the quality shift Asia and other regions recorded higher profits due to price deficiency and other factors.
Speaker Change: Thank you very much.
Speaker Change: Net income of consolidated subsidiaries in shale profit of investments accounted for using the equity method in China decreased mainly due to an increase in sales sequentially.
Operator: Me Good afternoon, ladies and gentlemen. Welcome to Toyota's financial results presentation. So we have some announcements about the documents distributed today. It's 5 to 2, so we have disclosed the financial results. But today they are not distributed physically, but it will be shown on the screen. You can download the material from the website for the investors' information and the corporate website as well. So please wait until we officially start the session.
Speaker Change: No.
Speaker Change: Do you see your own prisons subtle to present.
Speaker Change: Hello.
Speaker Change: Operating income in the financial services business increased largely due to an increase in room.
Hello, everyone. This is Sato speaking.
Speaker Change: In the last fiscal year, we were able to deliver many vehicles to customers by demonstrating our onsite capabilities.
Speaker Change: Next I would explain the forecast for the fiscal year ending March 31.
Speaker Change: Yes.
Tom: Thank you Tom.
Tom: Elevated vehicle sales is expected to be $9 8 million units, which is a 104, 7% of previous fiscal year, Toyota and Lexus vehicles sales are expected to reach $10 4 million units or 101, 2% of our P. This fiscal year due to the recovery in production volume.
Speaker Change: Even our certification issues recalls and disasters continued to impact production.
Speaker Change: I would like to express the company's sincere gratitude to our Toyota Lexus and <unk> customers as well as to our suppliers and dealers.
Speaker Change: Who worked hard to adapt to fluctuations.
Tom: Light vehicle sales is expected to be a total of 5.184 million.
Speaker Change: Alright.
Speaker Change: Facing various challenges over the past year.
Tom: Units or 49, 8% of total sales now that may explain the full year consolidated financial forecast, we have adopted the full year foreign exchange rate assumptions of 145 yen per U S. Dollar and 160 EMCORE Euro based on this our forecast for the full year, our sales revenue of 48 <unk>.
Speaker Change: The entire company has reaffirmed the importance of Toyota starting point of carefully making and delivering quality cars.
Okay.
Speaker Change: We will continue to build each car.
Tom: Chilean operating income of $3 eight trillion income before income taxes of $4 four one trillion yen and net income of 3.1.
Speaker Change: With careful attention to safety safety and quality to demonstrate gratitude to our customers and all our stakeholders.
Speaker Change: Through our actions.
Tom: Trillion yen.
Tom: Bill.
Speaker Change: Currently.
Tom: Next the factors, which impacted operating income forecast year on year.
Speaker Change: The environment surrounding the automobile industry, including trade relations is extremely flux.
Tom: A 400 billion yen increase due to the elimination of one time expenses related to Hino motors.
Speaker Change: August at a time when changes are updated in the future is unclear. We believe that we must continue to pursue making good cars without wavering from our principles of products centered management.
Tom: 700, and 745 billion yen decreased due to the impact of foreign exchange rates.
Tom: The impact of material prices at 360 billion yen with regard to the impact of U S tariffs only the estimated impact in April eight.
Speaker Change: We're striving to be.
Speaker Change: The best in town.
Tom: 2025, 180 billion yen has been tentatively factored in regarding comprehensive investment. We have added one 470 billion yen, we will steadily strengthen our management foundation is necessary and develop new pillar yourself future profits to realize sustainable growth from the mid to long term.
Okay.
Masahiro Yamamoto: Representative, Masahiro Yamamoto, We look forward to working with you for future projects Subscribe to my main & sub channels !!
Speaker Change: Almost all.
Speaker Change: We will continue to establish development and production systems tailored to each region. So that we can respond to the needs of our customers from a close.
Operator: See you in the next video ♡ Bye!
Speaker Change: And deliver cars on time.
Tom: Dave and transformation into a mobility company.
Speaker Change: Also.
Tom: Thank you.
Speaker Change: In order to flexibly respond to environmental changes, we want to firmly maintain and enhance our earning power.
Speaker Change: As in the previous year, we expect to eat sells the benefits of comprehensive investment and achieve an improvement of 349, some point fall as Gideon Yang to factors such as increased sales volume cost reduction efforts and expansion of value chain profits. As a result, the current forecast is three trillion $800.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: Thanks Damian.
Speaker Change: In particular, reducing cost in less vehicle production is an exercise not only.
Tom: And again, but we will use this as a starting point for future improvements.
Speaker Change: Increasing current earning power, but also in learning fundamental manufacturing principles and continuing the evolution of technology.
Speaker Change: Sure.
Speaker Change: I will explain toyotas profit.
Speaker Change: Structure.
Speaker Change: In the past as a result of pursuing a management style focused on quantitative targets, we faced an extremely severe situations during the E.
Speaker Change: So we will just competitiveness bonds from workplaces that pursue productivity and in which members scene and act independently.
Speaker Change: 2091 shocked when we fell into a deficit of 461 billion yen and wed like to just only one fast Julian Yang in cash on hand, and subsequently we rebuilt a financial base, mainly by improving our breakeven volume. So that we can continue to survive under any circumstances.
Speaker Change: To further strengthen this foundation this year.
Speaker Change: We will continue to focus on advancing our initiatives for strengthening our operational base.
Speaker Change: We will do this by creating environments in which we can demonstrate our onsite capabilities for supporting the production of 10 million cars and our ability to continue taking on diverse challenges for the future.
Speaker Change: As a result, we have been able to consistently achieve an arrow E of over 10% after further learning and making improvements during the COVID-19 pandemic. Additionally, we have significantly increased profitability, increasing the margin or profit per unit by approximately one six times.
Speaker Change: When you first began strengthening our foundation.
Speaker Change: We were very thorough about safety and quality.
Speaker Change: Jonathan.
Speaker Change: And.
Speaker Change: Although the proper work practices.
Speaker Change: And the first driving force behind this improvement was product or region Center management.
Our initiatives focused on regaining fundamental carmaking strengths and extra capacity for taking on challenges, which I think more efforts to stop the bleeding so to speak.
Speaker Change: He has been developing ever better cars tailored to each region expanded Toyota index. This lineup and nurtured G R as a new brand.
Speaker Change: These efforts are now shifting to initiatives aimed at southern seeds for the future.
Speaker Change: And this has allowed us to increase the average Judy price reduce incentives.
Speaker Change: Preventing recurrence of the certification issues as becoming an opportunity to accelerate workplace rooted improvement.
Speaker Change: And carefully sales each ever better cars.
Speaker Change: Leading to initiatives to strengthen our company's foundation, including its workplace culture.
Speaker Change: The second driving force was the implementation also to the strength of GPS towards the production system and cost reduction effort.
Speaker Change: In the voluntary GPS tissue Cam for certification work initiative established by German Toyota improvement activities for dressing essential issues are making progress by identifying waste and bottlenecks throughout all processes from planning and development.
Irie: [music] Ladies and gentlemen, thank you very much for coming despite your busy schedule. Let us now start the financial results meeting for the year ending March 2025. I will be the moderator for today. My name is Irie from the Public Relations Department.
Speaker Change: Since the COVID-19 pandemic, we have returned accumulative three seven trillion yen on a non consolidated basis to suppliers, while working together with our stakeholders to further enhance our cost competitiveness.
Speaker Change: We believe that these efforts are reflected in the results of the fiscal year ended March 2025 exit has explained at the beginning of this meeting.
Speaker Change: Two production.
Speaker Change: [noise] centered on the Toyota production system with G. P S be a rethinking in a future oriented way, how we work aiming to shorten lead times, we intend to expand this extra and company wide toward improving productivity.
Another newly emerging presence that is becoming a pillar of our financial foundation is the value chain.
Speaker Change: The Bar chart shows operating income by business.
Speaker Change: Compared to the fluctuating profit from used vehicles value chain profit such as those from parts and finance has been steadily expanding at a pace of 150 Beale Union annually over the past several years.
Speaker Change: Okay.
Our plant members have tackled the medium term to long term challenges of a shrinking working population.
Speaker Change: Young people turning away from manufacturing, while stepping up recruitment activities, we have improved workplace environments with efforts, including measures to combat heat, creating production lines on which are a diverse team members can we're comfortably and also by implementing our future production plans project.
Speaker Change: The full year forecast shows that it will expand to more than two trillion yen.
Speaker Change: We plan to further enhance the value of our 150 million units in operation, which is our strength through expanding maintenance services strengthening our connection with finance and insurance by connected technology.
Speaker Change: Which looks 50 years into the future.
Yoichi Miyazaki: Now, from EVP and Chief Financial Officer, Yoichi Miyazaki, we'll give you the outline of the financial... and Miyazaki's UFO.
Speaker Change: When it comes to development.
Speaker Change: As well as expanding the used car business.
We're working to improve our car, making productivity to continue to meet diverse needs.
Speaker Change: And accessories business.
Speaker Change: But in addition to this.
Speaker Change: We will also leverage.
Speaker Change: Yeah.
Speaker Change: Okay.
Speaker Change: Our software defined vehicles and expand profit from the new products and services created by working together with outside partners, who move into cities.
Speaker Change: Our area 35 activities with German to accurately grass customer needs and optimize specifications and component types has improved development deficiency by the equivalent of three vehicle model Redesigns on Israel basis in Japan.
Yoichi Miyazaki: I would like to express our heartfelt appreciation to our customers around the world who chose us as well as the shareholders, dealers, and suppliers who support So first I would like to tell you the summary. Our operating income for the fiscal year ended March 2025 was 4.83 yen. This high level of operating income was secured through the effects of price revisions and expansion of value chain profits while advancing comprehensive investments that led to the future and reinforcing our operating foundation. The operating income forecast for the fiscal year ending March 2023 was 3.83 yen. We plan to reap the benefits of our efforts to reinforce our operational foundation while continuing comprehensive investments from a mid- to long-term perspective as well as strengthening our management foundation and developing new pillars of future profits.
Speaker Change: Okay.
Speaker Change: Of course.
Speaker Change: Long term stable financial Foundation is the base of a great vision.
Speaker Change: Going forward, we intend to further improve our development and production efficiencies by.
Speaker Change: Inventing a path forward together.
Speaker Change: By expanding these activities globally.
Speaker Change: As a result of these efforts.
Speaker Change: We intend to expand and standardize earnings, especially in the asset business, which is stable.
Speaker Change: We are working on establishing assistant that will use digital transformation advances for seamlessly linking vehicles specification information from development to sales.
Speaker Change: The go to market and economic conditions and achieve a business structure that allows us to reduce the amount of capital required to prepare for profit fluctuations.
Speaker Change: <unk>, which is currently correlated by people.
Speaker Change: On top of that we intend to increase the flexibility of our capital policy focusing on returns to shareholders, including such things as further acceleration of stable dividend increases.
Speaker Change: Working together with our suppliers and dealers, we intend to strengthen our operational base for the future and improve our earning power.
Yoichi Miyazaki: With regard to the impact of the U.S. tariff, only the estimated impact of April and May 2025 have tentatively been factored in. As for shareholder returns, the full-year dividend for the fiscal year ended March 2023 was 19 yen, an increase of 15 yen compared to the previous fiscal year. The forecast full-year dividend for fiscal year ending March 2026 will be increased by 5 yen compared to the previous year, reaching 95 yen. Even in the face of declining profits, we will continue efforts to maintain a policy of a stable dividend increase that reward our long-term shareholders.
Speaker Change: We will leverage this foundation.
Speaker Change: And he was 20% was set as an indicator to measure the progress of this transformation of our business structure and capital structure towards a mobility company.
Speaker Change: To steadily advance our efforts to change the future of cars.
Speaker Change: What we do.
Speaker Change: And we will aim to transform into a mobility company.
Speaker Change: Great.
Speaker Change: The next section explains shareholder returns.
Speaker Change: This is our desire to contribute to people's happiness through costs and to provide freedom of mobility to four.
Our dividend policy is.
Speaker Change: To increase dividends in a stable and continuous matter manner in order to reward our long term shareholders.
Speaker Change: There is no clear definition of a mobility company.
Speaker Change: What is important is that.
Yoichi Miyazaki: From here, let me explain the details of the results for the fiscal year ending March 2025. Consolidated vehicle sales for this fiscal year was 9,362,000 units, which was 99.1% of consolidated vehicle sales for the previous fiscal year. Toyota and Lexus vehicle sales were 10,274,000 units, which was 99.7% of such sales for the previous fiscal year due to supply constraints caused by the certification issue and other factors. The proportion of electrified vehicles was 46.2%, a significant increase from the previous fiscal year, mainly led by HEVs, which were increased by 850,000 units from the previous year. Consolidated financial results sales revenues of 48,360.7 billion yen, operating income of 4,795.5 billion yen.
Speaker Change: And despite a decrease in profit for the fiscal year ended March 2025, we have decided to pay a full year dividend of 90 yen an increase of 15 million from the previous fiscal year as announced for the fiscal year ended March 2026, despite the difficulties.
Speaker Change: We continue to act toward Materializing vision.
Speaker Change: Good luck.
Speaker Change: We have been sowing seeds for the future, including building Toyota Ruble City, which is a test of course for mobility that will be increased one occupancy and demonstration trials. This fall also based on our third morbidity concept, we have been working to materialize on our path towards becoming a mobility company.
Anticipating the business outlook due to the impact of U S tariff impacts and other factors. The full year dividend forecast is 95 per share an increase of five Yang from the previous fiscal year.
Speaker Change: Yeah.
Speaker Change: I am we have not at year end share repurchase budgets, however, depending on the stock price levels and other factors and the need to respond to requests to sell our shares we will continue to flexibly implement share repurchases in the future.
Speaker Change: Our path includes contribution to achieving carbon neutrality and expanding the value of morbidity.
Speaker Change: With this as our pillars, we have deepened industry Transcending Corporation and made efforts to expand the value of cars by integrating with social systems to create a safe and secure mobility society.
Speaker Change: Lastly, filter alone cannot achieve structural reform of our business going forward.
Yoichi Miyazaki: income before income tax of 6,414.5 billion yen and net income of 4,765 billion yen.
Speaker Change: We will work together with our stakeholders.
Speaker Change: This fiscal year, we will focus on key themes of enhancing the resolution or mileage pathway approach and establishing a foundation for Toyota unique software defined vehicles.
Speaker Change: With their support this concludes my explanation of the financial results.
Yoichi Miyazaki: I would like to explain the factors which impact the total income year-on-year. From FY2024 results of ¥5,352.9 billion, we excluded ¥352.9 billion of one-time favorable effects, which was attributable to market conditions and other factors, and ¥700 billion for comprehensive investments, resulting in a forecast of ¥4,300 billion at the beginning of FY2025. Although there was an impact from volume decline and model mix deterioration due to the suspension of production at Toyota Motor Manufacture in Indiana in the U.S., the profit amounted to ¥4,795.5 billion due to the improvement of earning power through price divisions, controlling incentives, and expansion of value chain profits.
Intuitive moat pathway approach.
Speaker Change: Okay. Thank you very much.
Speaker Change: <unk> desire is.
Speaker Change: Now I would like to introduce the CEO and the president subtle to present.
Speaker Change: To contribute to the achievement of carbon neutrality, while leaving no one behind.
Speaker Change: Contributing to sue to reduction through various vehicle types. We've also leverage technologies. We have four next generation battery electric vehicles to further evolve PA trends overall.
Speaker Change: Absolutely.
Speaker Change: Hello, everyone. This is set those speaking.
Speaker Change: Thank you.
Speaker Change: In the last fiscal year, we were able to deliver many vehicles to customers by demonstrating our on site capabilities.
In addition to make each kind of powertrain genuine option, we will work with many partners to drive advances in fuel and infrastructure.
Speaker Change: Ethernet certification issues recalls and disasters continued to impact production.
Speaker Change: I would like to express the company's sincere gratitude to our Toyota Lexus and <unk> customers as well as to our suppliers and dealers.
Yoichi Miyazaki: We believe that the major achievement was a 510 billion yen output of cost reduction efforts, marketing efforts, while steadily reaping the benefits of comprehensive investment and the reinforcement of operational foundation for the future, such as restoring the production pace to the current cruising speed of 10 million.
Speaker Change: Yeah.
Speaker Change: For internal combustion engine vehicles, we are continuing to refine and then.
Speaker Change: Who worked hard to adapt to fluctuations.
Speaker Change: <unk> technologies and strive to achieve the evolution of engines hybrid systems and tools.
Speaker Change: Go ahead.
Speaker Change: Facing various challenges over the past year.
Speaker Change: In terms of achieving carbon neutrality, when considering the current junior to vehicles in operation. It is important to promote this.
Speaker Change: The entire company has reaffirmed the importance of the starting point of carefully making and delivering quality cars.
Yoichi Miyazaki: So this slide shows operating income by geographical region. Japan continued to maintain a high level of profit despite an increase in expenses due to the strengthening of the supplier base. In North America, operating income decreased due to the factors such as the impact of lower production volume caused by the four-month shutdown of Toyota Motor Manufacturing in Indiana, USA. Due to the quality issues, Asia and other regions recorded higher profits due to price divisions and other factors. Operating income of consolidated subsidiaries and share of profit of investment accounted for using the equity method in China decreased mainly due to an increase in sales expenses.
Speaker Change: Shifting to more environmentally friendly mobility centered on hybrid vehicles, which can immediately reduce emissions and to accelerate the spirit of carbon neutral fuels.
Speaker Change: Okay.
Speaker Change: We will continue to build each car.
Speaker Change: Although with careful attention to safety safety and quality to demonstrate gratitude to our customers and all our stakeholders.
Speaker Change: To meet the expectations of our customers around the world. We will continue to provide practical options that contribute to carbon neutrality, including more affordable hybrid vehicles.
Speaker Change: Our actions.
Speaker Change: Automobile currently.
Speaker Change: The environment surrounding the automobile industry, including trade relations is extremely flux.
But in order to put minimized battery reasons in addition to technological innovation and vehicles and batteries.
Speaker Change: At a time when changes are updated in the future is unclear.
Speaker Change: I believe it is necessary to create a battery ecosystem from battery material procurement to collection and reuse.
Yoichi Miyazaki: Operating income in the financial services business increased largely due to the increase in loan balances.
Speaker Change: We believe that we must continue to pursue making good cars without wavering from our principles of products centered management and striving to be.
Yoichi Miyazaki: Next, I will explain the forecast for the fiscal year ending March 31. Consolidated vehicle sales is expected to be 9.8 million units, which is 104.7% of the previous fiscal year. Toyota and Lexus vehicle sales are expected to reach 10.4 million units, or 101.2% of the previous fiscal year, due to the recovery in production volume. Electrified vehicle sales is expected to be a total of 5.184 million. units or 49.8% of total sales.
Speaker Change: We will create a framework for industry transcending cooperation.
Speaker Change: The best in town.
Speaker Change: Work hard to create an environment where popularization.
Speaker Change: Okay.
Speaker Change: Almost the whole.
Speaker Change: When it comes to hydrogen mobility, the key do popularization is reducing the price of hydrogen.
Speaker Change: Okay.
Speaker Change: We will continue to establish development and production systems tailored to each region. So that we can respond to the needs of our customers from up close.
Speaker Change: By accelerating the social implementation of hydrogen morbidity in commercial vehicles, including through external sales were a hydrogen shore power units, we intend to increase hydrogen usage, which will lead to cost reductions and infrastructure expansion.
Speaker Change: And deliver cars on time.
Speaker Change: Also how do you think.
Speaker Change: In order to flexibly respond to environmental changes, we want to firmly maintain and enhance our earning power.
Yoichi Miyazaki: Now let me explain the full year consolidated financial forecast. We have adopted a full year foreign exchange rate assumptions of 145 yen per US dollar and 160 yen per euro. Based on this our forecast for the full year are sales revenue of 48.5 trillion, operating income of 3.8 trillion, income before income taxes of 4.41 trillion yen, and net income of $3.1 trillion. trillion yen.
Speaker Change: We will continue our efforts throughout the entire value chain without wavering from our aspirations for the future of hydrogen.
Speaker Change: Joseph.
Got it.
Speaker Change: Meanwhile, mortgage software defined vehicles.
Speaker Change: In particular, reducing costs in mass vehicle production is an exercise not only.
Speaker Change: Play a leading role in transformation from cars to mobility through software defined vehicles, we intend to achieve safer more secure and more enjoyable mobility. The key to this is to increase the expand the ability of cars by renewing or extraordinary platform and employing third a software play.
Speaker Change: Increasing.
Speaker Change: Current earning power, but also in learning fundamental manufacturing principles and continuing the evolution of technology.
Speaker Change: So I hope this competitiveness bonds from workplaces that pursue productivity and in which members think and act independently.
Yoichi Miyazaki: Next are the factors which impacted operating income forecast year-on-year. A 400 billion yen increase due to the elimination of one-time expenses related to Hino Motors. A 745 billion yen decrease due to the impact of foreign exchange rates. The impact of material prices is 350 billion yen. With regard to the impact of U.S. tariffs, only the estimated impact in April and May 2025, 180 billion yen has been tentatively factored in. Regarding comprehensive investment, we have added 470 billion yen. We will steadily strengthen our management foundation as necessary and develop new pillars of future profit to realize sustainable growth from a mid- to long-term perspective and transformation into a mobility company.
Speaker Change: Irina.
In addition in doing so.
Speaker Change: Performance will become more important than ever. Furthermore for cars to connect with society. It is important to develop infrastructure such as in the form of seamless communications environment and data centers last year together with Nippon Telegraph and telephone Corporation, we started building that far.
Speaker Change: To further strengthen this foundation this year.
Speaker Change: We will continue to focus on advancing our initiatives for strengthening our operational base.
Speaker Change: We will do this by creating environments in which we can demonstrate our onsite capabilities for supporting the production of 10 million cars and our ability to continue taking on diverse challenges for the future.
Speaker Change: Based on these foundational software defined vehicles will help expand various possibilities of added value.
Speaker Change: When you first began strengthening our foundation, we have a very thorough about safety and quality.
Speaker Change: For example, green.
Speaker Change: <unk>.
Speaker Change: Jonathan.
Speaker Change: To materialize a diverse values the data and AI will create such a database to be a good development in service evolution.
Jonathan: Got it.
Jonathan: Followed proper work practices.
Jonathan: Our initiatives focused on regaining fundamental carmaking strengths and extra capacity for taking on challenges, which I think more efforts to stop the bleeding so to speak how away from these efforts are now shifting to initiatives aimed at southern seeds for the future.
Speaker Change: Asia grew together with customers and services that utilize onboard sensors.
Yoichi Miyazaki: Additionally, as in the previous year, we expect to reap some of the benefits of comprehensive investment and achieve an improvement of ¥349.5 billion through factors such as increased sales volume, cost reduction efforts, and expansion of value chain profits. As a result, the current forecast is ¥3,800,000,000,000, but we will use this as a starting point for future improvements.
Speaker Change: Sure.
Speaker Change: Through co creation with our partners, we will continue to accelerate the development of our foundation for growth a unique software defined vehicles.
Jonathan: Preventing recurrence of the certification issues as becoming an opportunity to accelerate workplace rooted improvement.
Speaker Change: I have now shared with you our key.
Speaker Change: Initiatives for this fiscal year.
Jonathan: Leading to initiatives to strengthen our company's foundation, including its workplace culture.
Speaker Change: To transform into a mobility company, we need to envision, creating mobility society and pursue no sequential evolution.
Jonathan: In the voluntary GPS tissue Cam for certification work initiative established by Chairman Toyota improvement activities for dressing essential issues are making progress by identifying waste and bottlenecks throughout all processes from planning and development.
Yoichi Miyazaki: I will explain Toyota's profit structure. In the past, as a result of pursuing a management style focused on quantitative targets, we faced an extremely severe situation during the 2009 Lehman shock, where we fell into a deficit of 461 billion yen and were left with only 1.5 trillion yen in cash on hand. Subsequently, we rebuilt our financial base mainly by improving our break-even volume so that we can continue to survive under any circumstances. As a result, we have been able to consistently achieve an ROE of over 10% after further learning and making improvements during the COVID-19 pandemic.
Speaker Change: Or in other words innovation.
Speaker Change: Together with many partners, we will work towards creating values for cars that are integrated with society and accelerate our efforts to change the future of course.
Jonathan: Two production.
Jonathan: Centered on the Toyota production system with G. P S be a rethinking in a future oriented way, how we work aiming to shorten lead times, we intend to expand this extra and company wide toward improving productivity.
We greatly appreciate your support and understanding.
Speaker Change: Thank you very much.
Speaker Change: We will now move to the Q&A session. Please wait a while as we prepare.
Jonathan: Yes.
Jonathan: Okay.
Jonathan: Our plant members have tackled the medium term to long term challenges of a shrinking working population.
Speaker Change: For the Q&A session.
Yoichi Miyazaki: Additionally, we have significantly improved profitability, increasing the marginal profit per unit by approximately 1.6 times. The first driving force behind this improvement was product and region-centered management. We have been developing ever-better cars tailored to each region, expanded the Toyota and Lexus lineup, and nurtured GR as a new brand. This has allowed us to increase the average unit price, reduce incentives, and carefully sell each ever-better car. The second driving force was the implementation of a Toyota-strength GPS, a Toyota production system, and cost-reduction efforts. Since the COVID-19 pandemic, we have returned a cumulative 3.7 trillion yen on a non-consolidated basis to suppliers while working together with the stakeholders to further enhance our cost competitiveness.
Jonathan: And young people to Nick away from manufacturing, while stepping up recruitment activities, we have improved workplace environments with efforts, including measures to combat heat, creating production lines on which are a diverse team members can more comfortably and also by implementing our future production plans project, which.
Speaker Change: [music].
It looks 50 years into the future.
Jonathan: When it comes to development.
Jonathan: We are working to improve our car, making productivity to continue to meet diverse needs.
Jonathan: Okay.
Jonathan: Our area 35 activities.
Jonathan: With join to accurately grass customer needs and optimize specifications and component types as increased development deficiency by the equivalent of three vehicle model Redesigns, Venezuela basis in Japan going forward, we intend to further improve our development and production efficiencies by expanding.
Yoichi Miyazaki: We believe that these efforts are reflected in the results of the fiscal year ended March 2025, as has been explained at the beginning of this meeting. Another newly emerging presence that is becoming a pillar of our financial foundation is the value chain.
Jonathan: These activities globally.
Jonathan: We are working on establishing assistant that will use digital transformation advances for seamlessly linking vehicles specification information from development to sales.
Yoichi Miyazaki: The bar chart shows operating income by business. Compared to the fluctuating profits from new vehicles, value chain profits such as those from parts and finance has been steadily expanding at a pace of 150 billion yen annually over the past several years. The full year forecast shows that it will expand to more than 2 trillion yen. We plan to further enhance the value of our 150 million units and operations, which is our strength, through expanding maintenance services, strengthening our connection with finance and insurance by connected technologies, as well as expanding the used car business and accessories business.
Speaker Change: Well I already.
Jonathan: She is currently correlated by people.
Speaker Change: Let us now start the Q&A session.
Speaker Change: With it.
Speaker Change: Responders to the Q&A session. Please come up onto the stage.
Jonathan: By working together with our suppliers and dealers, we intend to strengthen our operational base for the future and improve our earning power.
Speaker Change: Now let me introduce the attendees.
Speaker Change: Our fresh grocery subtly chief Executive Officer.
Jonathan: So we.
Jonathan: We will leverage this foundation.
Jonathan: Goodbye to steadily advance our efforts to change the future of cars.
Speaker Change: Yes.
Speaker Change: Yuichi EMEA Zaki.
Speaker Change: Thank you, Dave Vice President and Chief Financial Officer.
Jonathan: What we need to.
Jonathan: And we will aim to transform into a mobility company.
Okay.
Jonathan: This is a desire to contribute to people's happiness to cars and to provide freedom of mobility to fall.
Speaker Change: Lesser heating Yamamoto, Chief Officer accounting group.
Speaker Change: Please take your seats.
Yoichi Miyazaki: In addition to this, we will also leverage a software-defined vehicle, and expand profit from new products and services created by working together with outside partners in moving cities.
Jonathan: There is no clear definition of a mobility company.
Speaker Change: Let us now start the Q&A session.
Jonathan: What is important.
Jonathan: Portland is.
Speaker Change: We have people.
We continue to act toward Materializing vision.
Speaker Change: In the venue in online, but we were first a question for people in this room. If you have any questions. Please raise your hand, we'll bring a microphone to you because of time limitations, we would like to limit the number of your questions each to two per person.
Yoichi Miyazaki: and this long-term stable financial foundation is the base of our group's vision. inventing our path forward together. as a result of these efforts. We intend to expand and stabilize earnings, especially in the asset business, which is less susceptible to market and economic conditions, and achieve a business structure that allows us to reduce the amount of capital required to prepare for profit fluctuations. On top of that, we intend to increase the flexibility of our capital policy, focusing on returns to shareholders, including such things as further acceleration of stable dividend increases.
Jonathan: We have been sowing seeds for the future, including building close that loop with <unk>, which is a test of course for mobility that.
Jonathan: It would be increased <unk> occupancy and demonstration trials this fall.
Speaker Change: The person in the middle in the front.
Speaker Change: The corner.
Jonathan: Also based on our third morbidity concept, we have been working to materialize, our path towards becoming a mobility company.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: <unk> from Chunichi Shimbun. Thank you very much for today I have two questions.
Jonathan: Our paths includes contribution to achieving carbon neutrality and expanding the value of morbidity.
Speaker Change: The year ending March 2025.
Speaker Change: About the results.
Jonathan: This is our pillars, we have deepened industry transcending cooperation and made efforts to expand the value of cars by integrating with social systems to create a safe and secure mobility society.
Speaker Change: Our production staff because of certification EUR solidifying your foundation.
Speaker Change: Revenues increased in profits were reduced though so what is your interpretation of the results I would like to pose this question to Mr. Sato.
Jonathan: This fiscal year, we will focus on key themes of enhancing the resolution or mileage pathway approach and establishing a foundation for Toyota unique software defined vehicles.
Speaker Change: Okay.
Yoichi Miyazaki: An ROE of 20% was set as an indicator to measure the progress of this transformation of our business structure and capital structure towards a mobility company.
So should I.
Speaker Change: Sure can.
Okay.
Your second question first.
Speaker Change: The second question about the additional tariff imposed on cars by the United States.
Jonathan: But as you look into this mode to pathway approach.
You mentioned that the impact for April and May would be 180 billion.
Yoichi Miyazaki: The next section explains shareholder returns. Our dividend policy is to increase dividends in a stable and continuous manner in order to reward our long-term shareholders. Despite a decrease in profit for the fiscal year ended March 2025, we have decided to pay a full-year dividend of ¥90, an increase of ¥15 from the previous fiscal year, as announced. For the fiscal year ended March 2026, despite the difficulties in anticipating the business outlook due to the impact of U.S. tariff impacts and other factors, the full-year dividend forecast is ¥95 per share, an increase of ¥5 from the previous fiscal year.
Jonathan: <unk> desire is.
Jonathan: To contribute to the achievement of carbon neutrality, while leaving no one behind.
Speaker Change: For the tariff impact.
Speaker Change: Oh, what is the basis of this number.
Jonathan: And contributing to sue to reduction through various vehicle types. We've also leverage technologies. We have four next generation battery electric vehicles to further evolve PA trends overall.
Speaker Change: And if there's a tariff policy continues.
Speaker Change: How will this.
Speaker Change: Impact your results for March 2026, I believe there will be further impacts us, but what is your understanding of the impact.
Jonathan: In addition to make each kind of powertrain genuine option, we will work with many partners to drive advances in fuel and infrastructure.
Speaker Change: Thank you very much for your questions. Let me start with your first question.
Speaker Change: Yeah.
About our interpretation of the results for the previous fiscal year I have three points to raise here first.
Jonathan: I think for internal combustion engine vehicles, we are continuing to refine and then.
Speaker Change: Appreciation to others.
Speaker Change: As you mentioned a lot of things happened last year.
Yoichi Miyazaki: We have not set year-end share repurchase budgets. However, depending on the stock price level and other factors, and the need to respond to requests to sell our shares, we will continue to flexibly implement share repurchases in the future.
Jonathan: Technologists and strive to achieve evolution of engines hybrid systems and tools.
Speaker Change: And.
Globally, many customers have utilized the <unk> cars and even when the delivery time is very long day weighted for our cars and we are very grateful for the to those customers and that is the number one reason behind the results of the year engine March 2025.
Jonathan: In terms of achieving carbon neutrality when considering the current junior to vehicles in operation. It is important to promote this shift to more environmentally friendly mobility centered on hybrid vehicles, which can immediately reduce C O two emissions and to accelerate the spirit of carbon neutral fuels.
Yoichi Miyazaki: Lastly, Toyota alone cannot achieve structural reform of our business going forward. We all work together with our stakeholders. with their support.
Speaker Change: Okay.
Speaker Change: I would also like to thank the dealers and also the suppliers, which allowed us to deliver those cars.
Yoichi Miyazaki: This concludes my explanation of the financial results. Thank you very much.
Jonathan: To meet the expectations of our customers around the world. We will continue to provide practical options that contribute to carbon neutrality, including more affordable hybrid vehicles.
So appreciation to others.
Speaker Change: Is the first point that I would like to mentioned there are two other points.
Speaker Change: Yes.
Sato: Now I'd like to introduce the CEO and President Sato to present. Thank you for your patience. Hello everyone, this is Sato speaking. In the last fiscal year, we were able to deliver many vehicles to customers by demonstrating our on-site capabilities. even as certification issues, recalls, and disasters continue to impact production. I would like to express the company's sincere gratitude to our Toyota, Lexus, and GR customers, as well as to our suppliers and dealers. who worked hard to adapt to fluctuations. Facing various challenges over the past year, the entire company has reaffirmed the importance of Toyota's starting point of carefully making and delivering quality cars.
Jonathan: But in order to put mineralized battery EV in addition to technological innovation when vehicles and batteries.
Speaker Change: Looking at the results.
Speaker Change: How important it is to follow the basic.
Jonathan: I believe it is necessary to create a battery ecosystem from battery material procurement to collection and reuse.
Speaker Change: Our principles.
Speaker Change: Alright.
Speaker Change: Not being able to produce cars Oh, it was a very difficult for us the people on the gamba frontline's.
Jonathan: We will create a framework for industry transcending cooperation and work hard to create an environment where popularisation.
Speaker Change: Did their art, most and despite the fact that they were very busy and they worked very hard to recover and restart production.
When it comes to hydrogen mobility, the key do popularisation is reducing the price of hydrogen.
Speaker Change: And those efforts led to the financial results of last year that is the second point to note.
Jonathan: By accelerating the social implementation of hydrogen morbidity in commercial vehicles, including through external sales of hydrogen insured par units, we intend to increase hydrogen usage, which will lead to cost reductions and infrastructure expansion.
Speaker Change: And third.
Speaker Change: As Mr. <unk> mentioned in his presentation.
Speaker Change: The profit structure change.
Speaker Change: Has had an impact on the financial results and of course, our new vehicles had a very large impact on <unk>.
Jonathan: We will continue our efforts throughout the entire value chain without wavering from our aspirations for the future of hydrogen.
Speaker Change: But of your new vehicle impact fluctuate.
Speaker Change: And when volatility is high or how can we avoid high that volatility is a question.
Meanwhile, mortgage.
Jonathan: Find vehicles will play a leading role in transformation from cars to mobility to software defined vehicles, we intend to achieve safer more secure and more enjoyable mobility. The key to this is to increase the expand the ability of cars by renewing joining.
Sato: We will continue to build each car. With careful attention to safety and quality to demonstrate gratitude to our customers and all our stakeholders Currently, the environment surrounding the automobile industry, including trade relations, is extremely fluxed.
Speaker Change: Our supply chain has become stronger we've been working on this for several years and the results are starting to be seen and once.
Speaker Change: Those effects start to be seen.
Jonathan: <unk> platform and employing third a software platform arena.
Speaker Change: The extra investment in capacity and the strategy would be impacted by this.
Jonathan: In addition in doing so.
Speaker Change: So those are the three points.
Jonathan: Performance will become more important than ever. Furthermore for cars to connect with society. It is important to develop infrastructure such as in the form of seamless communications environment and data centers last year together with Nippon Telegraph and telephone Corporation, we started building.
Speaker Change: Cool.
Sato: At a time when changes are rapid and the future is unclear, we believe that we must continue to pursue making good cars without wavering from our principles of product-centered management and striving to be and the best in town. We will continue to establish development and production systems tailored to each region so that we can respond to the needs of our customers from up close. and deliver cars on time. Also, in order to flexibly respond to environmental changes, we want to firmly maintain and enhance our earning power. In particular, reducing costs in mass vehicle production is an exercise not only increasing current earning power but also in learning fundamental manufacturing principles and in continuing the evolution of technology.
Speaker Change: I would like to raise regarding the financial results for the year ending March 2025.
Speaker Change:
Speaker Change: Your second question was about the U S tariffs.
Speaker Change: A government to government negotiations.
Speaker Change: Ongoing at the moment and the government officials are working hard now.
Jonathan: Based on these foundational software defined and vehicles will help expand various possibilities of added value.
Speaker Change: So.
Speaker Change: Details of tariffs.
Speaker Change: Still moving so at this moment is very difficult to forecast the future but.
Jonathan: For example.
Jonathan: Gen two.
Jonathan: To materialize at diverse values that data and AI will create such a database vehicle development and service evolution.
Speaker Change: At the moment there is already terrorists that.
Speaker Change: Impose that and that part has been reflected in our forecast for this fiscal year.
Asia grew together with customers and services that utilize onboard sensors.
We don't want to waver from our basic principles.
Jonathan: Yeah.
And we will stay the course.
Jonathan: Through co creation with our partners, we will continue to accelerate the development of a foundation for a unique software defined vehicles.
Speaker Change: So depending on whether you're looking at short term or medium term, what we can do the change.
Speaker Change: For exports to the United States, One 5 million units of course, we have many customers in the United States.
Jonathan: I have now shared with you our key initiatives for this fiscal year.
Jonathan: Moving to transform into a mobility company.
Speaker Change: So.
Speaker Change: Okay.
Jonathan: We need to envision, creating mobility society and pursuit no sequential evolution.
Speaker Change: Desirably.
We want to allocate to the United States, but in the short term.
Speaker Change: We have to look at how we allocate the cars, but over the medium to long term.
Jonathan: Or in other words innovation.
Sato: Toyota's competitiveness spawns from workplaces that pursue productivity, and in which members think and act independently.
Jonathan: Together with many partners, we will work towards creating values for cars that are integrated with society and accelerate our efforts to change the future cars.
Speaker Change: Appropriate products for the.
Sato: To further strengthen this foundation, this year, We will continue to focus on advancing our initiatives for strengthening our operational base. We will do this by creating environments in which we can demonstrate our on-site capabilities for supporting the production of 10 million cars and our ability to continue taking on diverse challenges for the future. When we first began strengthening our foundations, we were very thorough about safety and equality. followed proper work practices. Our initiatives focused on regaining fundamental core making strengths and extra capacity for taking on challenges, which I think were efforts to stop the bleeding, so to speak.
Speaker Change: Our local area.
Speaker Change: It should be produced locally and delivered locally.
Jonathan: Greatly appreciate your support and understanding.
Okay.
Mr. Tang is something that we've always talked about in the community in the country.
Jonathan: Many of those are in Mustang. Thank you very much.
Speaker Change: As a local citizen Oh, we are taking actions so that pillar will not waiver.
Jonathan: We will now move to the Q&A session. Please wait a while as we prepare for the Q&A session.
Speaker Change: So over the medium to long term, we will continue to take that approach.
Speaker Change: Thank you very much.
Speaker Change: Thank you.
Jonathan: [music].
During the next question.
Yes.
Speaker Change: Yes.
Speaker Change: Also in the back there.
Speaker Change: Maybe second row from the front please.
Speaker Change: Okay.
Sato: However, these efforts are now shifting to initiatives aimed at sowing seeds for the future. Preventing recurrence of the certification issues has becoming an opportunity to accelerate workplace-rooted improvement. leading to initiatives to strengthen our company's foundation, including its workplace culture. In the voluntary TPS tissue can for certification work initiative established by Chairman Toyoda improvement activities for addressing essential issues are making progress by identifying waste and bottlenecks throughout all processes from planning and development. production Centered on the Toyota Production System, or TPS, we are rethinking, in a future-oriented way, how we work, aiming to shorten lead times.
Speaker Change: When we should.
Speaker Change: He kidder osaki newspaper.
Speaker Change: I have two questions as well. The first question is about <unk> U S tariff policy.
Yeah.
Jonathan: Oh.
Jonathan: Yeah.
Speaker Change: The impact is so difficult to forecast accurately however.
Speaker Change: <unk> has been triggering.
Domestic production liberal or 3 million units.
Speaker Change: Is it unchanged and maintained at that level is that the right understanding.
Speaker Change: Mr. Sato mentioned about mid to long term perspective localization will be further promoted naturally.
Speaker Change: But the image too long.
Tom.
Jonathan: [music].
Speaker Change: Doctor area.
Speaker Change: Might be revised or readjusted.
Speaker Change: Is that would that become necessary to readjust the 3 million unit production in the us.
Jonathan: Okay.
Sato: We intend to expand this action, company-wide, toward improving productivity.
Jonathan: Okay.
Speaker Change: System in Japan, and you have a relationship with your suppliers.
Jonathan: Okay.
Jonathan: Thank you.
Speaker Change: Did you use the terrorists the duct parts suppliers might need to do some transfer the debt.
Jonathan: It is now start the Q&A session.
Jonathan: For the.
Sato: Our plant members have tackled the medium-term to long-term challenges of a shrinking working population and young people turning away from manufacturing. While stepping up recruitment activities, we have improved workplace environments with efforts including measures to combat heat, creating production lines on which our diverse team members can work comfortably, and also by implementing our Future Production Plans project, which looks 50 years into the future.
Jonathan: The responders to the Q&A session. Please come up onto the stage.
Speaker Change: The increased cost to their transactional brush do you. So what are the position of dirt to do the suppliers requests like that suppliers the burden might be coverage and accepted by TMC itself is that the direction or there could be maybe a combination of Ah yes.
Jonathan: Okay.
Jonathan: Now let me introduce the attendees.
Jonathan: Our first.
Jonathan: She certainly chief Executive Officer.
Jonathan: Yes.
Jonathan: Yuichi Miyazaki.
Speaker Change: Isn't there you work together with the suppliers to further reduce the cost to cope with the situation.
Jonathan: Executive Vice President and Chief Financial Officer.
Speaker Change: Including the addition of burden borne you started your suppliers or do you think Oh. These are the U S tariff policy.
Jonathan: Sandy.
Jonathan: Lesser heating Yamamoto, Chief Officer accounting group.
Sato: When it comes to development... We are working to improve our car making productivity to continue to meet diverse needs. Our Area 35 activities, which are meant to accurately grasp customer needs and optimize specifications and component types, have improved development efficiency by the equivalent of three vehicle model redesigns on a trial basis in Japan. Going forward, we intend to further improve our development and production efficiencies by expanding these activities globally. We are working on establishing a system that will use digital transformation advances for seamlessly linking vehicle specification information from development to sales. which is currently correlated by people.
Jonathan: Yes.
Jonathan: Please take your seats.
Speaker Change: Yeah.
Speaker Change: Uh huh.
Speaker Change: The beginning as the domestic production policy and aspirations. That's my first point I'd like to mention and Mr. Miyazaki, who act as to the substance to respond to your question. So.
Jonathan: Great.
Jonathan: Let us now start the Q&A session.
Jonathan: We have people.
Jonathan: In the venue in online, but we were first a question for people in this room. If you have any questions. Please raise your hand, we'll bring a microphone to you because of time limitations, we would like to limit the number of your questions each to two per person.
Speaker Change: So actually domestic production.
Speaker Change: It has a significant share in Japan, we shouldn't forget that it should be unchanged do we like to maintain that level. However.
Speaker Change: Because domestic production and supply chain should be insured and protected and are they continuing exports, we will earn the foreign currency and by the end of foreign currency, Japan can purchase the energy necessary for the Japanese domestic activities.
Jonathan: The question in the middle in the front and the.
Jonathan: The corner.
Jonathan: Hello.
Jonathan: Thank you.
Speaker Change: <unk> from Chunichi Shimbun. Thank you very much for today I have two questions.
Speaker Change: And transactions.
Jonathan: The year ending March 2025.
Speaker Change: From that standpoint, I think domestic production should be protected.
Speaker Change: About the results.
Speaker Change: As a manufacturing industry you should do is an important point that we should keep in mind from that stand point.
Speaker Change: Our production stopped because of certification EUR solidifying your foundation.
Sato: Working together with our suppliers and dealers, we intend to strengthen our operational base for the future and improve our earning power. We will leverage this foundation.
Speaker Change: Revenues increased in profits were reduced though so what is your interpretation of the results I would like to pose this question to Mr. Sato.
Speaker Change: The domestic production and aspiration for that and will.
Well, we will continue in a few changes based upon that assumption.
Sato: to stately advance our efforts to change the future of cars. and we will aim to transform into a mobility company at the root of this is a desire to contribute to people's happiness through cars and to provide freedom of mobility to all There is no clear definition of a mobility company. What is important is that we continue to act toward materializing our vision.
Speaker Change: So shall I answer.
Speaker Change: Do you dose can be added by new stuff yes.
Speaker Change: Sure can.
Speaker Change: Can you ask your second question first.
Speaker Change: Thank you.
Mr. Duda: Mr. Duda for your question earlier.
Speaker Change: And the second question about the additional tariff imposed on cars by the United States.
Speaker Change: You said that.
Speaker Change: Perfect restructure of the T M C.
Speaker Change: You mentioned that the impact for April and May would be 180 billion.
Speaker Change: I like to maybe recap.
Speaker Change: If we can show that like to show that they are going to you, but anyway right now and from your standpoint.
Speaker Change: For the tariff impact.
Speaker Change: Oh, what is the basis of this number.
Speaker Change: Silence.
Speaker Change: And if there's a tariff policy continues.
Speaker Change: The 2023 in March and the civil hundreds of some $5 6 million units or to the consolidated figure.
Speaker Change: Well.
Speaker Change: This impact.
Speaker Change: Impact your results for March 2026, I believe there will be further impacts us, but what is your understanding of the impact.
Speaker Change: At the time of a COVID-19, there was a situation that the $1 3 million units considered its a sales reduction of goods that is why it is down it comes down to civil was down.
Sato: We have been sowing seeds for the future, including building Toyota Wubun City, which is a test course for mobility that will begin phase one occupancy and demonstration trials this fall. Also, based on our third mobility concept, we have been working to materialize our path toward becoming a mobility company. Our path includes contribution to achieving carbon neutrality and expanding the value of mobility. With this as our pillars, we have a deepened industry transcending cooperation and made efforts to expand the value of cars by integrating with social systems to create a safe and secure mobility society.
Speaker Change: Thank you very much for your questions. Let me start with your first question.
Speaker Change: 2.2 trillion.
Speaker Change: Operating income was still achieved if I can sign on top you can see that activities launched at that time and then there is the the marginal profit to an apple.
Speaker Change: About our interpretation of the results for the previous fiscal year I have three points to raise here first.
Speaker Change: Appreciation to others.
Speaker Change: As you mentioned a lot of things happened last year.
Do you own six bolt ons to decide this.
Speaker Change: And because we are.
Speaker Change: Listening to the USA.
Speaker Change: <unk> proven there's also which achieved through these airports so as to the potential impact by Vitaros as to the appropriate destruction and business structure is the business. We are not forced to take the two of his direction. We can continue a stable policy and the 3 million units. We are talking about is Mr. Sato mentioned the X.
Speaker Change: Globally, many customers they utilize to all cars and even when the delivery time is very long day weighted for our cars and we are very grateful for the to those customers. So that is the number one reason behind the results of the year ending March 2025.
Sato: This fiscal year, we will focus on our key themes of enhancing the resolution of a multi-pathway approach and establishing a foundation for Toyota's unique software-defined vehicles. In Toyota's multi-pathway approach, our value, desire, is... to contribute to the achievement of carbon neutrality while leaving no one behind. In contributing to CO2 reduction through various vehicle types, we've also leveraged technologies we hone for next-generation battery electric vehicles to further evolve power trains overall. In addition, to make each kind of powertrain a genuine option, we will work with many partners to drive advances in fuel and infrastructure. For internal combustion engine vehicles, we are continuing to refine our elemental technologies and strive to achieve evolution of engines, hybrid systems, and fuels.
Speaker Change: To use yourself 500000 units so for the customer so it might cause some problems that we have a long list of back orders and so that's the current situation.
Speaker Change: Yeah.
Speaker Change: I would also like to thank the dealers and also the suppliers, which allowed us to deliver those cars.
Speaker Change: So appreciation to others.
Speaker Change: It doesn't force us to revise and we look at this domestic production our structure, including the government to government negotiation we were.
Speaker Change: Is the first point that I would like to mentioned there are two other points.
Okay.
Speaker Change: Looking at the results.
Speaker Change: How important it is to follow the basic.
Speaker Change: See and monitor how the negotiation will take place between the two governments. In addition vehicles cannot be produced only by us.
Speaker Change: Okay.
Speaker Change: Our principles.
Speaker Change: You need a cooperation with other suppliers or is that the customers do you get the sales Ddos networks. So all of those.
Speaker Change: Thank you.
Speaker Change: Not being able to produce.
Speaker Change: Oh, it was a very difficult for us the people on the Gamba frontline's.
Speaker Change: All parties need to collaborate together to take a mid to long term initiatives. So we are looking and monitoring situation. We have built is a good profit structure already so without taking any huge injection. We were plagued by the year and then it takes stable actions and as I.
Speaker Change: They're at most.
Speaker Change: And despite the fact that they were very busy.
They worked very hard to recover and restart production.
Speaker Change: And those efforts led to the financial results of last year that is the second point to them.
Speaker Change: I mentioned earlier.
Speaker Change: Third.
Automotive industry.
Speaker Change: As Mr. <unk> mentioned in his presentation.
Speaker Change: Quite an important significant role to play in the Premier units of production in Japan.
Speaker Change: Our profit structure change.
Speaker Change: <unk> has had an impact on the financial results and of course, our new vehicles has a very large impact.
And then D D.
Sato: In terms of achieving carbon neutrality when considering the current units of vehicles in operation, it is important to promote the shift to more environmentally friendly mobility centered on hybrid vehicles, which can immediately reduce CO2 emissions and to accelerate the spread of carbon neutral fuel. To meet the expectations of our customers around the world, we will continue to provide practical options that contribute to carbon neutrality, including more affordable hybrid vehicles.
Speaker Change: Do we explored the vehicles and earn before the foreign currency of about 23 on yet and then 2014 is the input.
Speaker Change: Profit, but a V a new vehicle impact fluctuate.
Speaker Change: We pay for energy and resources. So that we are playing an important role for Japanese economy, and we'd like to continue to play that important role in the future as well for the suppliers what is the a kid who each supplier we listen to the voices of regress to decide upon how to address the issues and we will have a very.
Speaker Change: And when volatility is high or how can we avoid high that volatility is a question.
Speaker Change: The supply chain has become stronger we've been working on this for several years and the results are starting to be seen and once.
Speaker Change: That detail.
Speaker Change: Those effects start to be seeing.
Speaker Change: Okay and listen to their views.
Speaker Change: The extra investment in capacity and the strategy would be impacted by this.
Speaker Change: True.
Speaker Change: Fox sharing shouldnt be promoted together with the suppliers and Ddos and so there was no drug. So we have to do care to them and then find out which is the happiness for the customers and then we will have to continue the operation the automobile manufacturing as well.
Sato: In order to popularize battery EVs, in addition to technological innovation in vehicles and batteries, I believe it is necessary to create a battery ecosystem from battery material procurement to collection and reuse. We will create a framework for industry transcending cooperation and work hard to create an environment for popularization.
Speaker Change: So those are the three points.
Speaker Change: Sure.
Speaker Change: That I would like to raise regarding the financial results for the year ending March 2025.
Speaker Change: Okay.
Speaker Change: Your second question was about the U S tariffs.
That's right.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: Our government to government negotiations.
Speaker Change: The second point is.
Speaker Change: Ongoing at the moment and the government officials are working hard now so.
We do.
Speaker Change: The operating profit forecast that you just showed us.
Sato: When it comes to hydrogen mobility, the key to popularization is reducing the price of hydrogen. By accelerating the social implementation of hydrogen mobility in commercial vehicles, including through external sales of hydrogen fuel power units, we intend to increase hydrogen usage, which will lead to cost reductions and infrastructure expansion. We will continue our efforts throughout the entire value chain without wavering from our aspirations for the future of hydrogen.
Speaker Change: Details of tariff so still moving so at this moment is very difficult to forecast the future, but at the moment there is already terrorists that.
Speaker Change: About the U S business is my question.
Speaker Change: The tariff burden.
Will it be transferred to the vehicle prices or would you not be thinking about it for the time being.
Speaker Change: Being imposed that and that part has been reflected in our forecast for this fiscal year.
Speaker Change: I understand it will be difficult to make a forecast, but in the profits that you have forecast.
Speaker Change: We don't want to waver from our basic principles.
No.
Speaker Change: The U S.
Speaker Change: What is the U S sales volume that you assumed.
Speaker Change: And we will stay the course.
Speaker Change: So.
Speaker Change: Our people are talking about reduction due to last minute purchases in the previous year, but.
Speaker Change: Depending on whether you're looking at short term or medium term, what we can do will change.
Sato: Meanwhile, software-defined vehicles will play a leading role in transformation from cars to mobility. Through software-defined vehicles, we intend to achieve safer, more secure, and more enjoyable mobility. The key to this is to increase the expandability of cars by renewing our electronic platform and employing Toyota's software platform, A-Wing. In addition, in doing so, cheap performance will become more important than ever. Furthermore, for cars to connect with society, it is important to develop infrastructure such as in the form of seamless communications environments and data centers.
Speaker Change: What is.
Speaker Change: For exports to the United States, One 5 million units of course, we have many customers in the United States.
Speaker Change: Your outlook at the time being.
Speaker Change: So tell us about the relationship with our forecast.
Speaker Change: So.
Speaker Change: Absolutely.
Speaker Change: Desirably.
Speaker Change: I think it's a question of how to look at the sales volume but.
Speaker Change: We want to allocate to the United States, but in the short term.
Speaker Change: And then when we plan or do a sales plan.
Speaker Change: We have to look at how we allocate the cars, but over the medium to long term.
Speaker Change: Oh.
Speaker Change: <unk>.
Speaker Change: Appropriate products for that.
Speaker Change: For our financial results, we look at the fiscal year, but for our business. We look at the calendar year in April in the United States.
Speaker Change: Our local area.
Speaker Change: It should be produced locally and delivered locally.
Speaker Change: Bob.
Speaker Change: This downturn is something that we've always talked about in the community in the country.
Speaker Change: There was a last minute market demand going up.
Speaker Change: Yeah.
Sato: Last year, together with the Nippon Telegraph and Telephone Corporation, we started building that foundation. Based on these foundations, software-defined vehicles will help expand various possibilities of added value. For example, we intend to materialize the diverse values that data and AI will create such as database vehicle development and service evolution, AI agents that go together with customers and services that utilize on-board sensors. Through co-creation with our partners, we will continue to accelerate the development of a foundation for Toyota's unique software-defined vehicles.
Speaker Change: And there might be.
Speaker Change: Repercussions from that.
Speaker Change: As a local citizen Oh, we are taking actions so that pillar will not waiver.
Speaker Change: So.
Speaker Change: There will be pluses and minuses.
Speaker Change: But as he mentioned.
Speaker Change: It is difficult to forecast the future so depending on how things develop we would like to take the appropriate action.
Speaker Change: So over the medium to long term, we will continue to take that approach.
Speaker Change: Okay.
Speaker Change: Thank you very much.
Speaker Change: And maybe I shouldn't say Fortunately button.
Speaker Change: Thank you.
Speaker Change: Okay.
Speaker Change: I would like to entertain the next question.
Speaker Change: In the United States Toyota cars is still popular.
Speaker Change: Yes.
Speaker Change: Yes.
Speaker Change: Especially in the back there.
Speaker Change: And the inventory level is less than 10 days worth and for our mainline hybrid is the turnover is in five days. So we will look at real demand and I think we can make appropriate adjustments with regards to sales price.
Speaker Change: Maybe second row from the front please.
Yes.
Speaker Change: And he kinda osaki newspaper.
Have two questions as well.
Speaker Change: First question is about this U S tariff policy.
Sato: I have now shared with you our key initiatives for this fiscal year. To transform into a mobility company, we need to envision creating a mobility society and pursue non-sequential evolution. or in other words, innovation. Together with many partners, we will work toward creating values for cars that are integrated with society and accelerate our efforts to change the future of cars.
Speaker Change: We think it is up to the customer.
Speaker Change: The impact is so difficult to forecast accurately however that Toyota has been triggering.
Speaker Change: The competitive situation real demand situation will be looked at as we did before.
Speaker Change: Domestic production liberal or 3 million units.
Speaker Change: And so far customer demand was very strong and it.
Speaker Change: Is it unchanged and maintained at that level is that the right understanding.
Speaker Change: In the past they've raised their prices are from and when demand was high. So we will look at the situation and to take the appropriate action at the appropriate timing.
Speaker Change: Mr. Sato mentioned about mid to long term, so effective localization will be further promo didn't naturally.
Speaker Change: But the.
Speaker Change: In mid to long.
Speaker Change: And just because of tariff a rising prices.
Speaker Change: Tom.
Speaker Change: The Doctor area.
Sato: We would greatly appreciate your support and understanding. Thank you very much.
Speaker Change: Might be revised or readjusted.
Speaker Change: Uh huh.
Speaker Change: Hastily is not the type of reaction to it or is thinking.
Speaker Change: Is that would that become necessary to readjust the 3 million unit production system in Japan.
Speaker Change: Thank you very much to anything to that.
Speaker Change: So we don't go into the next question the person in there.
Speaker Change: Have a relationship with your suppliers. So does did you use the terrorists.
Operator: We will now move to the Q&A session. Please wait a while as we prepare for the Q&A session. Thank you for watching!
Speaker Change: From royalties.
Speaker Change: Parts suppliers might need to do some transfer the guts of.
Speaker Change: Now or when you're home curious I assume that I have two questions as well.
Speaker Change: The increased cost to their transactional breast do you so what what the position of dirt to do their suppliers requests like that suppliers the burden might be coverage and accepted by TMC itself is that the direction or there could be a combination of Ah yes.
Speaker Change: Soon enough.
Speaker Change: The U S. This tax policy of tariff policy.
Speaker Change: In the future would that have impact upon your future business.
Speaker Change: How do you analyze and look at that the potential impact short term versus the long and mid term.
Speaker Change: Isn't there you work together with the suppliers to further reduce the cost to cope with the situation.
Speaker Change: The countermeasures that this tonnage for our new policy is that do you think a transient one timer change or the for you are you as a business is that going to be more long lasting impact.
Speaker Change: Including the addition of burden on you said your suppliers what do you think of the U S tariff policy.
Speaker Change:
Speaker Change: Uh huh.
Speaker Change: Your business could you please comment on the future.
Speaker Change: At the beginning as the domestic production policy and aspirations. That's my first point I'd like to mention and Mr. Music you add.
Speaker Change: My question is about 3 million units.
Speaker Change: Put them to be maintained in Japan.
Speaker Change: To maintain that level.
Speaker Change: As to the substance to respond to your question.
Speaker Change: Do you intend to take actions.
Speaker Change: I'm sure the domestic production.
Speaker Change: And measures.
Speaker Change: It has a significant share in Japan, we shouldn't forget that it should be unchanged do we like to maintain that level. However.
Speaker Change: Goes to the U S. U S import means to our increased cost incurred so that maybe you you increased exports to other regions order so more in domestic market, but are those measures and you're thinking about in order to maintain the 3 million units of production program in Japan.
Speaker Change: Because domestic production and supply chain should be insured and protected and by continuing export will earn to foreign currency and by the end of foreign currency, Japan can purchase the energy necessary for the Japanese domestic activities.
Thank you for your question Mr. Yao.
Speaker Change: Let me repeat some of the point.
Speaker Change: And transactions so far.
Operator: Let us now start the Q&A session. Will the responders to the Q&A session please come up onto the stage. Thank you.
From that standpoint, I think domestic production should be protected.
Third I want to be the best in town, that's a model to be.
Speaker Change: Our manufacturing industry. He should do each on an important point that we should keep in mind from that stand point.
Speaker Change: Cody based company.
Company.
Speaker Change: Many actresses that even though the U S tariff policy might change axis and policy will not change as I said that in the long term that the logo of production will go into development and it will be emphasized in the short term.
Speaker Change: Point, the domestic production and aspiration for that and will.
Operator: Now let me introduce the attendees.
Koji Sato: First, Koji Sato, Chief Executive Officer.
Speaker Change: We will continue in a few changes based upon that assumption.
Speaker Change: The dose can be added by new stuff, yes.
Yoichi Miyazaki: Yoichi Miyazaki, Executive Vice President and Chief Financial Officer Masahiro Yamamoto, Chief Officer, Accounting Group Please take your seats. Let us now start the Q&A session. We have people in the venue and online, but we will first take questions from people in this room. If you have any questions, please raise your hand. We will bring a microphone to you. Because of time limitations, we would like to limit the number of questions each to two per person. The person in the middle, in the front, in the corner.
Speaker Change: There are two of the actual demand the optima our response and the operation should be devised. So these are the combination of efforts will make to deal with the change on the other hand.
Speaker Change: Thank you.
Speaker Change: Mistake it up for your questions earlier.
Speaker Change: Judy said.
Speaker Change: Perfect restructure of the T M C.
Speaker Change: I like to maybe recap that.
Speaker Change: So if we can show that I would like to show that they are going to you, but anyway right now and from your standpoint.
Speaker Change: Okay.
Would that be a domino once a permanent loss.
Speaker Change: We are not in a position to decide on that tax tariff policy. So whatever the situation would change we would have to be flexible to deal with and then we will maintain our basic pillar and policy on the course, and then deal with the situation 3 million units of volume maintained in Japan.
Speaker Change: On site.
Speaker Change: The 2023 in March at the several hundreds to some $5 6 million units 30 of your consolidated sales.
Speaker Change: So at the time of a COVID-19 that was seen situations. The one 3 million units the consolidated sales reduction or good luck. This white test down it comes down to supercuts.
To do that.
Speaker Change: As I said, we should strengthen our foundation that is a strong activity.
Speaker Change: 2.2 trillion.
Speaker Change: Operating income was still achieved if I can.
Speaker Change: To maintain the domestic production level. The strong foundation is crucial in other words through cold.
Speaker Change: <unk> signed on top you can see that activities was launched at that time, and then that is D. D D. The marginal profit.
Sugito: I am Sugito from Chūnichi Shimbun. Thank you very much for today. I have two questions. The year ending March 2025. About the results, our production stopped because of certification and you are solidifying your foundation, but revenues increased and profits were reduced, so what is your interpretation of the results? I would like to pose this question to Mr. Yamamoto. So should I answer?
Speaker Change: Like a supplementary efforts.
Speaker Change: Do you own six bolt ons to decide this.
Speaker Change: Oh, well like <unk> to read.
Speaker Change: We support in English for the suppliers, but it's not perfect to return the money back to them, but rather in order for them to further improve the productivity and have the spare room. We just worked so closely with the suppliers. It's a work together so we know how with a high level over the production operation.
Speaker Change: Shifting to the USA. The improvement is also achieved through these airports so as to the potential impact from the tariffs.
Speaker Change: The appropriate to structure the business structure is abated.
Speaker Change: We are not forced to take it to a hasty action. We can continue a stable policy and the 3 million units. We are talking about of Mr said donations the export to use yourself 500000 units. So for the customer so it might cause some problems that we have a long list of back orders and so that's the current situation.
Speaker Change: Just.
Speaker Change: So maybe the people in the field.
Speaker Change: Workplace might not have the enough energy or the spare capacity to improve further.
Sugito: Can you ask your second question first? The second question, about the additional tariff imposed on cars by the United States. You mentioned that the impact for April and May would be $180 billion for the tariff impact. What is the basis of this number? And if the tariff policy continues, how will this impact your results for March 2026? I believe there will be further impacts, but what is your understanding of the impact, Mr. Sato?
Speaker Change: We should give them the spare room in the energy and capacity.
Speaker Change: So the it.
Speaker Change: It doesn't force us to revise and you look at this domestic production our structure, including he says the government to government negotiation we were.
Speaker Change: They can work better so we will create a good climate and environment for them to do that so you can look just a funding support for them and redone the money back to them, but in the mid to long term. It will eventually boost productivity together and further reduce the cost incurred and then ASIC effectiveness.
Speaker Change: See and monitor how the negotiation would take place between the two governments. In addition vehicles cannot be produced only by I mean.
Speaker Change: We need the cooperation of the suppliers or is that the customers are there.
Speaker Change: With improved and then eventually the total competitive edge will be further enhanced so domestic production level should be maintained.
Speaker Change: They did the sales Ddos networks. So all of those all of the parties need to collaborate together to take Amit two long term initiatives. So we are looking and monitoring situation. We have built is a good profit structure already so without taking any he's dixon we were plagued by the year and then to take stake.
Speaker Change: Their production, we will strengthen our productivity and then competitiveness and that I think is a very important cycle redact achieved thank you very much.
Yoichi Miyazaki: Thank you very much for your questions. Let me start with the first question. about our interpretation of the results for the previous fiscal year. I have three points to raise here. Thank you for your appreciation to others. As you mentioned, a lot of things happened last year. Globally, many customers utilize our cars and even when the delivery time is very long, they waited for our cars and we are very grateful to those customers. That is the number one reason behind the results of the year ending March 2025. I would also like to thank the dealers and also the suppliers which allowed us to deliver those cars.
Speaker Change: Yes.
Speaker Change: <unk> actions.
Speaker Change: Thank you very much to Michelle.
Speaker Change: And as I mentioned earlier.
Speaker Change: In the middle.
Speaker Change: The automotive industry.
Speaker Change: A third from the front row.
Speaker Change: Quite an important so can you just kind of a role to play in the premier units production in Japan.
Speaker Change: Melissa.
Speaker Change: Color Gucci from Nick on cargo.
Speaker Change: And then D D.
Speaker Change: No.
Speaker Change: Except for a tariff impact.
Speaker Change: Do we explored the vehicles and earned before the foreign currency of over 23 on yet and then 24 three and is the input.
Fiscal 2025, what kind of year will it be how do you position this year.
Speaker Change: Asia a transformation in a century.
Speaker Change: We pay for energy and resources. So that we are playing an important role for Japanese economy, and we'd like to continue to play that you put on ROE in the future as well for the suppliers.
Speaker Change: It's been several years since this has been discussed and diversification in localization.
Speaker Change: We're working on these but Ah ha.
Speaker Change: How is business going to be this year towards 2030.
Speaker Change: Okay.
Speaker Change: Each supplier, we listen to the voices of requests to decide upon how to address the issues and we will have a very detailed.
Speaker Change: And my second question is about earning power on the hybrid side.
Yoichi Miyazaki: So, appreciation to others. is the first point that I would like to mention. There are two other points. Looking at the results... how important it is to follow the basic and other principals. Thank you. Not being able to produce cars was very difficult for us. The people on the Genba, the front lines, did their utmost, and despite the fact that they were very busy, they worked very hard to recover and restart production. and those efforts led to the financial results of last year. That is the second point. and third As Mr. Miyazaki mentioned in his presentation, the profit structure changed.
Our profitability is.
Speaker Change: And listen to their views.
Speaker Change: Almost equal to gasoline cars I think it was last year that Mr. Amit I mean as I can.
Speaker Change: So manufacturing should be promoted together with the suppliers and Ddos anyway. So it was no drug so we have to do care to them and then find out.
Speaker Change: Can you talk about a 5 million hybrid vehicles.
Speaker Change:
Was this a milestone.
Speaker Change: Happiness for the customers and then we will have the continued operation of automobile manufacturing as well.
Speaker Change: This milestone unchanged.
Speaker Change: So and.
And what about your plans for improvement for BHP.
Speaker Change: Some of it.
Speaker Change: Yes.
Thank you very much for your question.
Speaker Change: The second point is.
Speaker Change: The positioning of fiscal 2025 as.
Speaker Change: Yeah.
The operating profit forecast that you just showed us.
Speaker Change: As I mentioned in the presentation.
Speaker Change: About the U S business is my question.
Speaker Change: This year.
Speaker Change: In a sense, an awful lot of Israel.
Speaker Change: The tariff burden.
Speaker Change: Thanks.
Speaker Change: This new law.
Speaker Change: Will it be transferred to the vehicle prices or will you not be thinking about it for the time being.
It is a year where globally.
Speaker Change: We are now seeing the speed towards electrification in each region.
Speaker Change: I understand it will be difficult to make a forecast, but in the profits that you have forecast.
Yoichi Miyazaki: has had an impact on the financial results. Of course, a new vehicle has a very large impact on profits, but a new vehicle impact fluctuates. When volatility is high or how can we avoid high volatility is a question. The supply chain has become stronger. We've been working on this for several years and the results are starting to be seen. Those effects start to be seen. The extra investment capacity and strategy would be impacted by this.
Speaker Change: So depending on the region the speed or.
Speaker Change: Okay.
Speaker Change: The U S.
Speaker Change: Oh electrification will develop.
Speaker Change: What is the U S sales volume that you assumed.
Speaker Change: We'll be clearer.
Speaker Change: Our people are talking about reduction due to last minute purchases in the previous year, but.
In case of battery Evs in the past we discussed this on a global basis, obviously now that China is moving fast and not only electric vehicles, but intelligence plus EV is pushing forward.
Speaker Change: What is your outlook at the time being so tell us about the relationship with our forecast.
Speaker Change: Okay.
Speaker Change: The mobility so.
Speaker Change: I think it's a question of how to look at the sales volume button.
Speaker Change: Okay.
Speaker Change: So a bedroom E V leading edge technology will be incorporated so that a we can push forward in mobility.
Speaker Change: And then when we plan or do a sales plan.
Speaker Change: Oh, we.
Speaker Change: In the case of battery. He can he said we will be delving deeper into this area and for hybrids.
Yoichi Miyazaki: So those are the three points. that I would like to raise regarding the financial results for the year ending March 2025.
Speaker Change: For our financial results when you look at the fiscal year, but for our business. We look at the accounting there at year end.
Speaker Change: April in the United States.
Speaker Change: Realistically speaking.
Speaker Change: There was a last minute market demand going up.
Speaker Change: Oh, we have seen a shift to the evs, but having said that.
Yoichi Miyazaki: Your second question was about the U.S. tariff. Government-to-government negotiations are ongoing at the moment, and the government officials are working hard now, so... details of tariffs still moving. So at this moment, it's very difficult to forecast the future, but at the moment, there is already tariffs that are being imposed, and that part has been reflected in our forecast for this fiscal year. We don't want to waver from our basic principles, and we will stay the course. So, depending on whether you're looking at short-term or medium-term, what we can do will change. For exports to the United States, 1.5 million units.
Speaker Change: Okay.
Speaker Change: And there might be.
Speaker Change: There are many ways to realize carbon neutrality and so I know approach yeah that combines our vehicles are with corvid.
Speaker Change: Repercussions from that.
Speaker Change: So.
Speaker Change: There will be pluses and minuses.
Speaker Change: But as you mentioned.
Speaker Change: Carbon neutrality will be very important so from the fuel side of carbon neutrality.
Speaker Change: It is difficult to forecast the future so depending on how things develop we would like to take the appropriate action.
Speaker Change: We'll have to be.
Speaker Change: Realize it will be a very important turning point towards that so hybrid ph D V will be the pillar, but.
And maybe I shouldn't say Fortunately button.
Speaker Change: Okay.
Speaker Change: In the United States Toyota cars is still popular.
Speaker Change: In addition to that carbon neutral fuel.
Speaker Change: And the inventory level is less than 10 days of course and for our mainline hybrid is the turnover is in five days. So we will look at real demand and I think we can make appropriate adjustments with regards to sales price.
Speaker Change: We'll be combined so that kind of a practical solution will be accelerated.
Speaker Change: And that will be very important.
Speaker Change: Okay.
Speaker Change: So in a sense almost all of them.
Speaker Change: The basic pillars remain unchanged, but the resolution of each element too will be higher than before.
Speaker Change: We think it is up to the customer.
Yoichi Miyazaki: Of course, we have many customers in the United States. So, Desirably, we want to allocate to the United States, but in the short term, we have to look at how we allocate the cars, but over the medium to long term. appropriate products for the local area should be produced locally and delivered locally. Best in town is something that we've always talked about in the community in the country as a local citizen we are taking actions so that pillar will not waver So over the medium to long term, we will continue to take that approach.
Speaker Change: The competitive situation real demand situation will be looked at as we did before.
Speaker Change: And there was another point that we are focused on which is.
Speaker Change: Creating an environment or ecosystem.
Speaker Change: So far customer demand was very strong and.
Speaker Change: Yes.
Speaker Change: Just pushing forward evolution of the vehicle does not lead to realization of our mobility battery Evs hydrogen.
Speaker Change: In the past they've raised prices.
Speaker Change: And when demand was high so we will look at the situation and to take the appropriate action at the appropriate timing.
Speaker Change: Yeah.
Speaker Change: Requires it energy infrastructure and the legal framework.
Speaker Change: And just because of tariff are rising.
Speaker Change: Uh huh.
Speaker Change: So.
And hastily is not the type of reaction to it or is thinking.
Speaker Change: Mobility of cars.
Speaker Change: Alone.
Speaker Change: We will not allow us to push forward a mobility society and so our comprehensive approach is necessary, which means that we have to work with their energy or I T industry people.
Speaker Change: Thanks, very much to mistake Kinder.
Speaker Change: <unk> next question the person in the upfront royalties.
Speaker Change: And we also have to work with government.
Speaker Change: Okay.
Speaker Change: Now when you're home case, I've seen them I have two questions as well.
Speaker Change: To create the environment.
Yoichi Miyazaki: Thank you very much. Thank you.
Speaker Change: Just assuming that Chris about the U S. This tax policy of tariff policy.
Speaker Change: And that will be the foundation.
Speaker Change: And this year, we have to focus more on creating this foundation.
Ikeda: We'd like to entertain the next question. in the back there, maybe second row from the front please.
Speaker Change: In the future would that have impact upon your future business now how do you analyze and look at that the potential impact short term versus the long and midterm do countermeasures.
Speaker Change: No.
Speaker Change: Earnings power will be discussed by Mr. Yang Mi psyche.
Speaker Change: Jackie.
Speaker Change: The small cities.
Ikeda: I'm Ikeda of Sankei newspaper. I have two questions as well. The first question is about this US tariff policy. The impact is so difficult to forecast accurately. However, Toyota has been treasuring the domestic production level of 3 million units. Is it unchanged and maintained at that level? Is that the right understanding? Or as Mr. Sato mentioned about mid to long term, prospective localization will be further promoted naturally? but in mid to long term That area... The three million unit production system in Japan, you have a relationship with your suppliers. So as to the U.S. tariffs, the parts suppliers might need to transfer the increased cost to their transaction price to you.
Speaker Change: Tonnage for our new policy is that do you think a transient onetime change.
Speaker Change: No.
Speaker Change: In the past and this year as everybody is pointing out it is.
Speaker Change: The for you are you is the business is that going to be more long lasting impact.
The future is unclear uncertain.
Speaker Change: But in this environment, what we have to do.
Speaker Change: For your business could you. Please comment on the few jobs and the second question is about 3 million units.
Speaker Change: Is to make sure we continue to produce and making happiness for all of those things.
Speaker Change: The volume to be maintained in Japan.
So maintaining $3 million in Japan.
Speaker Change: To maintain that level, how do you intend to take actions.
Speaker Change: And full operation of our overseas.
Speaker Change: And measures.
Speaker Change: <unk> is a necessary and we have to make sure we continue to produce ever better cars.
Speaker Change: To the U S. U S import means to our increased cost incurred so that maybe you you increased exports to other regions or are there still more in domestic market.
Speaker Change: Going back to the basics.
Speaker Change: And I believe.
Speaker Change: And doing what we have to do is what we will do in 2000 to 35 four.
Speaker Change: Those measures are you thinking about in order to maintain the 3 million units of production program in Japan.
Speaker Change: This year is a forecast of $3 eight trillion will be the starting point, but from here, we want to build up so that we can realize more I mentioned three eight trillion.
Yao: Thank you for your question Mr. Yao.
Yao: Let me repeat some of the point that.
Speaker Change: But terrorists, except for terrorism and exchange rate it will be one trillion that would be one trillion. So four eight trillion and earnings power.
Do that wants to be the best in town that's moved to the.
Locally based a company.
Yao: Company, So that the main actress, even though the U S tariff policy might change axis and policy will not change as I said that in the long term that the local production will go development now will be emphasized in the short term.
Ikeda: So what is the position of Toyota to deal with the supplier's request like that? The supplier's burden might be covered and accepted by TMC itself? Is that the direction? Or there could be maybe a combination of adjustment. You work together with the suppliers to further reduce the cost to cope with that situation. So including the additional burden upon the suppliers, what do you think of the U.S. tariff policy?
Speaker Change: That we can realize so how to step up from there is something about that we want to think about we want we need to create products that meet the real demand of our customers.
Speaker Change: For hybrid vehicles.
Okay.
Speaker Change: I mentioned before that real demand is very strong. So initially in 2026 5 million production.
Yao: To the actual demand the optimal response and the operation should be devised. So these are the combination of efforts will make to deal with the change on the other hand.
Speaker Change: Things that I mentioned and I talked about bringing this one forward but.
Speaker Change: After that we decided to focus on strengthening the foundation. So we stopped for a while to reorganize our development and production so for Highbridge.
Yao: Right.
Yao: Okay.
Yao: Would that be a domino was permanent.
Yoichi Miyazaki: At the beginning, as the domestic production policy and aspirations, that's my first point I'd like to mention.
Yao: We are not in a position to decide on that tax tariff policy. So what they believe the situation will change we would have to be flexible to deal with and then we will maintain our basic pillar and policy on the course, and then deal with the situation 3 million unit volume maintained in Japan.
Speaker Change: Last year as was mentioned before.
Yoichi Miyazaki: And Mr. Miyazaki will add to the substance to respond to your question. So actually domestic production has a significance here in Japan. We should never forget that. It should be unchanged. We like to maintain that level. However, because domestic production and supply chain should be ensured and protected and by continuing export, we will earn the foreign currency. And by the earned foreign currency, Japan can purchase the energy necessary for the Japanese domestic activity. for asking those questions. will continue in future initiatives. Based upon that assumption, the details can be added by Mr. Miyazaki.
Speaker Change: Plus 850000 compared to the previous years, what we realize but this year, we expect a growth of 5%.
Speaker Change: So $4 7 million is what we expected.
Yao: To do that.
So the original 2026.
Yao: As I said, we should strengthen our foundation that is a strong activity.
Speaker Change: <unk> is the plan that we had but how to fund forward that plan is something that we will continue to work on and if he wants to accumulate our earning power as we do so.
Yao: To maintain the domestic production level. The strong foundation is crucial in other words so cold.
Yao: Like us supplementary efforts.
Speaker Change: And about <unk>.
Yao: Well like Oh.
Speaker Change: One.
Yao: Booked and invest for the suppliers, but it's not that to return the money back to them, but rather in order for them to further improve the productivity and have the spare room. We just to work so closely with the suppliers. It's a work together. So we know how the high level over the production of operation in Peru.
Speaker Change: <unk>.
Speaker Change: As we have continued to decrease on cost.
Speaker Change: Other variation units I believe we'll be able to.
Speaker Change: Produces profits.
Speaker Change: I will be repeating myself, but we will do what we have to do now and me.
Speaker Change: We.
Yao: Just.
Speaker Change: Want to further strengthen our earning power.
Yao: So maybe the people in the field work.
Yao: Workplace might not have the enough energy or the spare capacity to improve further so.
I missed that.
Speaker Change: Okay.
Yoichi Miyazaki: Thank you, Mr. Ikeda, for your question. Earlier, I said that the profit structure of the TMC, so I'd like to maybe recap that. So if we can show that, I'd like to show that again to you. But anyway, right now, as from your standpoint to the left-hand side, that the 2023, in March of the 700, some 5, 6 million units, that is a consolidated figure of the sales. At the time of COVID-19, there was a situation that the 1.3 million units, the consolidated sales reduction occurred. That is why it has come down to 2.2 trillion yen of the operating income, but still achieved.
Speaker Change: No not at all.
Yao: We should keep them out there.
Speaker Change: That person was a great jacket.
Yao: Spare room in the energy and capacity so that they can work better. So we will create a good climate and environment for them to do that so it's not just a funding support for them and we've done the money back to them, but in the mid to long term. It will eventually boost productivity together and further reduce debt.
Speaker Change: My My TV told you I have a question to Mr. <unk>.
Speaker Change: Two questions one is the target to production volumes this year.
Speaker Change: The environment is getting difficult with the 10 million units have been already I mentioned six months ago. Mr. Music. The production plan has been prepared and.
Yao: <unk> incurred and then ASIC effectiveness will be improved and then eventually got total competitive edge will be further enhanced so domestic production levels should be maintained.
Speaker Change: OEM has a duty to.
Speaker Change: Study reproduced according to targets, but in a more difficult environment, Tim media units still launched what's the purpose of this 10 million unit announced do group collaboration the way you should be that's my second question, they too dangerous to seasonal talked about debt to go private.
Yao: By the prediction, we were strengthening our productivity and then competitiveness and that I think is a very important cycle really achieved thank you very much.
Yoichi Miyazaki: The right-hand side on top, you can see that the activities were launched at that time, and then the marginal profit went up to the 1.6-fold. And so this is destined to the USA. The improvement is also achieved through this effort. So as to the potential impact by the tariffs, as to the profit structure, and business structure is the basis. We are not forced to take the too hasty action. We can continue a stable policy. And the 3 million units we are talking about, as Mr. Sato mentioned, the export to the U.S. is 500,000 units. So for the customers, it might cause some problems. We have a long list of back orders.
Yao: Yes.
Speaker Change: The Toyota Group you have a policy based show cross shareholding so the way to the group's infrastructure should be the way it should be what do you think of including the potential real more about the industry going private.
Yao: Thank you very much to Michelle.
Yao: In the middle.
Yao: A third from the front row.
Yao: Among other things.
Yao: Color Gucci from Nick on cargo.
Yao: Okay.
Speaker Change: Thank you.
Yao: Except for tariff impact.
Speaker Change: For your question.
Yao: Fiscal 2025, what kind of year will it be how do you position this year.
Speaker Change: Okay.
Speaker Change: About the production.
Speaker Change: Volume 10 million units announced and what's the aspiration for that.
Yao: Major transformation in a century.
Speaker Change: Compared to the previous determine their doctor pro forma should you produce strategy and properly is that is the base is an important factor to maintain the profitability.
Yao: It's been several years since this has been discussed and diversification in localization.
Yao: You are working on these but how is business going to be this year towards 2030.
Speaker Change: Profitability. So we focused in the last one year to further strengthen our foundation.
Yao: And my second question is about earning power on the hybrid side.
Yoichi Miyazaki: So that's the current situation. So it doesn't force us to revise and look at this domestic production structure, including this government-to-government negotiation. We will see and monitor how the negotiation will take place between the two governments. In addition, vehicles cannot be produced only by us. We need the cooperation of the suppliers, the customers, the related sales, dealers, networks. So all those parties need to collaborate together to take and meet the long-term initiatives. So we are looking and monitoring the situation. We have built this good profit structure already. So without taking any hasty action, we will play it by ear and then take stable actions.
Speaker Change: As a means of the.
Speaker Change: 10 million units, we worked so hard to strengthen our foundation.
Yao: Our profitability is.
Yao: Almost equal to gasoline cars I think it was last year that Mr. Amit I mean as I can.
Speaker Change: And as the outcome results.
Speaker Change: And foods have been being in other the production has become stabilized.
Yao: You talked about a 5 million hybrid vehicles.
Yao: So does this a milestone.
Speaker Change: And the proof of produce a high quality vehicle and deliver to our users. That's a one of the important target for us and.
Yao: Is this milestone unchanged.
Yao: So.
Yao: And what about your plans for improvement for BHP.
Speaker Change: For example, about the investment.
Yao: Thank you very much for your question.
Speaker Change: The total comprehensive investment for human capital in the last several years for example.
Yao: The positioning of fiscal 2025.
Yao: As I mentioned in the presentation.
Speaker Change: The in the production line.
Speaker Change: Operation might stop sometimes you need a maintenance work has been freaking to repair it might be necessary in some of the facilities. So maybe upgrading and you.
And then the.
Yao: This year you mean.
Yao: In a sense on both of them had shrunk.
Yao: Because you don't know.
Yoichi Miyazaki: And as I mentioned earlier, the automotive industry has quite an important significance and role to play in the 3 million units of production in Japan. And then we export the vehicles and earn the foreign currency of 23 yen. And then 24 trillion is the import expense we pay for energy and resources, so that we are playing an important role for Japanese economy, and we'd like to continue to play that important role in the future as well. For the suppliers, what is our care? For each supplier, we listen to their voices and requests to decide upon how to address the issues, and we will have a very detailed care and listen to their views.
Yao: It's a year where globally.
Speaker Change: Reimbursement for that is quite important and it's.
Yao: We are now seeing the speed towards electrification in each region.
Speaker Change: It's a big condition.
So the frequency of the production line had to be stocked, but no. It doesn't have to be stocked. It's a kaizen improvement which has been achieved in the last several years. So you don't have to stop the production.
Yao: So depending on the region the speed or higher.
Yao: Oh electrification will develop.
Speaker Change: Production that is a bit of efficiency of the production. So that kind of these are in advancing this meant has borne fruit and then you could have a very good quality and efficient.
Yao: We'll be clear.
Yao: In case of battery Evs in the past we discuss this on a global basis, obviously know that China is moving fast and not only electric vehicles, but intelligence plus EV is pushing forward.
Speaker Change: Efficient production, which has shown just to strengthen the foundation that is the basis and that's why we are still quite aware of this.
Yao: The mobility so.
Speaker Change: Unit target and that you need to are so important to support and protect our supply chain on desktop point do we put it as a threshold.
Speaker Change: Good luck.
Speaker Change: So our battery EV, leading edge technology will be incorporated so that we can push forward in mobility.
Yoichi Miyazaki: So manufacturing should be promoted together with the suppliers and dealers and sales network. So we have to pay due care to them. And then final wish is happiness for the customers. And then we will have to continue the operation of automobile manufacturing as well.
Speaker Change: Target and then we'd like to continue our efforts. So that we can continue to steadily produce high quality vehicles.
Speaker Change: In the case of battery. He said, we will be delving deeper into this area and for Highbridge.
Speaker Change: And second point is a collaboration amongst the group of companies.
Speaker Change: Realistically speaking.
Speaker Change: We have seen a shift to the E V, but having said that are there.
Speaker Change: And of course.
Speaker Change: We'd like to transform to a mobility company that's Glenn Amy.
Speaker Change: There are many ways to realize carbon neutrality and so I know coach yeah that combines our vehicles are with climate.
Ikeda: The second point is the operating profit forecast that you just showed us about the U.S. business is my question. The tariff burden... Will it be transferred to the vehicle prices, or will you not be thinking about it for the time being? I understand it will be difficult to make a forecast, but in the profits that you have forecast... What is the U.S. sales volume that you assumed? People are talking about reduction due to last-minute purchases in the previous year, but what is your outlook at the time being. So tell us about the relationship with the forecast.
Speaker Change: And an entire group is trying to become a mobility company.
And then that's a challenge, we'll come and challenge for all of Us.
Speaker Change: Our carbon neutrality will be very important so from the fuel side of carbon neutrality.
Speaker Change: Sure.
Speaker Change: Be prepared.
Speaker Change: The information, we need to achieve disclosing Paris.
Speaker Change: Well have to be realized it will be a very important turning point towards that so hybrid ph D V will be the pillar, but.
Speaker Change: Do you feel that is out there.
Speaker Change: Productivity and efficiencies should be.
Speaker Change: They're not just a vertical integration might be beta it's more efficient to have a vertical.
Speaker Change: In addition to that carbon neutral fuel.
Speaker Change: We'll be combined so that kind of a practical solution will be accelerated.
Speaker Change: I agree with you, but when their vision, but we aim at.
Speaker Change: Long term on user base growth I feel that.
Speaker Change: And that will be very important.
Speaker Change: The automotive industry should continue to do you track this growth.
Speaker Change: Okay.
Speaker Change: In a sense you're almost equal.
Speaker Change: The basic pillars remain unchanged, but the resolution of each element to it will be higher than before.
Speaker Change: So this is each company Regina do the group should have its own strength within the what is the strength of the company within the entire to the group and then that the significance and meaning is going to be prudent with the Vigo supplier that is a T. M C.
Speaker Change: And there is another point that we are focused on which is creating an environment or ecosystem.
Yoichi Miyazaki: I think it's a question of how to look at the sales volume, but... When we plan or do a sales plan For financial results, we look at the fiscal year, but for a business, we look at the calendar year. In April, in the United States, There was a last minute market demand going up. and there might be... Hiroyuki Ueda, Sho Nagai, Hiroyuki Ueda, Sho Nagai, Hiroyuki Ueda, Sho Nagai, Hiroyuki But as you mentioned, it is difficult to forecast the future. So depending on how things develop, we would like to take the appropriate action. And maybe I shouldn't say fortunately, but...
Speaker Change: Yes.
Speaker Change: Just pushing forward evolution of the vehicle does not lead to realization of I'm looking at battery Evs hydrogen.
Speaker Change: But the DMC Dubuque on reducer is supported by different domains and each member companies has its own the aspiration to achieve a certain cool and seal or reach a group of the group companies. I think are trying to set those goals of course I'm a few OTT.
Speaker Change: Yeah.
Requires it energy infrastructure and the legal framework.
Speaker Change: So.
Speaker Change: Mobility of cars.
Speaker Change: Alone.
Speaker Change: Mr. Toyota is a leader the chairman of the entire group and she's message an aspiration, it's the basis of workforce and we'll continue discussions.
Speaker Change: We will not allow us to push forward a mobility society and so our comprehensive approach is necessary, which means that we have to work with their energy or I T industry people.
Speaker Change: Within our group.
Speaker Change: The industry is and how it's positioned well because its original company Oh the G. M. C. So it's a very important company historically and we need the TMC goop that the severe important to do the fork lift as was engine and other businesses as well.
And we also have to work with government.
Speaker Change: To create the environment.
And that will be the foundation.
Speaker Change: And this year, we have to focus more on creating this foundation.
Yoichi Miyazaki: In the United States, Toyota cars are still popular. and the inventory level is less than 10 days worth and for our mainline hybrid is the turnover is in five days so we will look at real demand and I think we can make appropriate adjustments. With regards to sales product We think it is up to the customer. The competitive situation, real demand situation will be looked at as we did before. So far, customer demand was very strong and in the past we've raised prices when demand was high. So we will look at the situation and take the appropriate action at the appropriate timing.
Speaker Change: Scott.
Speaker Change: No, earning power will be discussed by Mr. Young he is lucky.
Speaker Change: So it's a the important run with important companies within.
Speaker Change: The group, who their position stays the same.
Speaker Change: The small cities.
Speaker Change: So.
Speaker Change: May I clarify one point 10 million units are there targets use it did no external environment is.
Speaker Change: In the past and this year as everybody is pointing out it is.
Speaker Change: Deteriorating you produce 10 million units and do you have ultra grew global economy that you can still sell these many vehicles you intend to produce maybe news to me is that you can add.
Speaker Change: The future is unclear uncertain.
Speaker Change: But in this environment, what we have to do.
Speaker Change: Is to make sure we continue to produce and making happiness for all of that.
Speaker Change: So maintaining 3 million in Japan.
Speaker Change: They are also the ultra grew global economy, we cannot define the global economic outlook. However, we do.
Speaker Change: And full operation of our overseas.
Speaker Change: Vince is a necessary and we have to make sure we continue to produce ever better cars.
Speaker Change: Do we have a regional headquarters system in each region, we have a seal and do we discuss as the global economy and the reason they come and go look to come to over answer so.
Going back to the basics.
Yoichi Miyazaki: Just because of tariff rising prices. in hastily is not the type of reaction Toyota is thinking. Thank you very much to Mr. Ikeda.
Speaker Change: And that's what we do.
Speaker Change: And doing what we have to do is what we will do in 2035 four.
Speaker Change: Our own outlook wise 10 million units.
Speaker Change: And our goal we'd like to thank you all.
Speaker Change: This year is a forecast of 3.8 trillion will be the starting point, but from here, we want to build it up so that we can realize more I mentioned 8.8 trillion.
Speaker Change: The work towards it but it's not just a target.
Yao: So we'd like to entertain next question, the person in the front row, please. Yao of Nihon Keizai Shimbun, I have two questions as well. Similar question, about the US tax policy, tariff policy. In the future, will that have impact upon your future business? As now, how do you analyze and look at that potential impact? Short term versus long and mid term, the countermeasures. But this tariff, new policy, is that, do you think, a transient one-time change? Or for your US business, is that going to be more long-lasting impact for your business? Could you please comment on the future?
Speaker Change: The basic standard sort of.
Speaker Change: Of course too.
Speaker Change: It's not really the goal or target director achieved so please understand the nature of these 10 million units.
Speaker Change: But terrorists, except for terrorism and exchange rate it will be one trillion that would be one trillion. So four eight trillion and earnings power is something that we can realize so how to step up from there is something about that and we want to think about we want we need to create products that meet the real demand of our customers.
And in the past.
Speaker Change: I already told you but.
Speaker Change: In many regions, we like to strike a good balance and a good business in each region that is a strong weapon for our company to achieve stable business improved stability. Therefore.
Speaker Change: For hybrid vehicles.
Speaker Change: Therefore in particular region.
Speaker Change: You can do it.
Speaker Change: I mentioned before that real demand is very strong. So initially in 2026 phosphonium production is something that I mentioned and I talked about bringing this going forward but.
Speaker Change: It catches a cold and maybe the remaining healthy regions, Joe can complement and supplement for each other so the engagement.
Speaker Change: They do very active region versus seek region. The vehicle demand is might not match I think E. Two regional markets and markets will collaborate among themselves and then we tried to strike the balance between supply and demand. So that this system infrastructure can be stably operated so that we'd like to work harder with our support.
Speaker Change: After that we decided to focus on serving the foundation. So we stopped it for a while to reorganize our development and production so for Highbridge.
Yao: The second question is about 3 million units of the volume to be maintained in Japan. But to maintain that level, how do you intend to take action?
Speaker Change: Last year as was mentioned before.
Speaker Change: Plus 850000 compared to the previous years, what we realized but this year, we expect a growth of 5%.
Speaker Change: Naturally.
Speaker Change: 10 million units is not the end of it we are not aiming at achieving this target we have to build a good car one by one and eventually you might achieve 10 million units. So we like to do.
Speaker Change: So $4 7 million is what we expected.
Yao: and Yoichi Miyazaki, Hayakawa shuntaro, Ikeda Miyazaki undercoverization on Ikedai Miyazaki and Ikeda Mihara gotta watch. Thank you very much.
Speaker Change: So the original 2026 numbers is the plan that we had but how to fund Ford that plan is something that we will continue to work on and if he wants to accumulate our earning power as we do so.
Speaker Change: Did you care to build a good quality golf with each customer and user.
Speaker Change: Okay.
Speaker Change: Thank you very much.
Yoichi Miyazaki: Thank you for your question, Mr. Yao. Let me repeat some of the points. Toyota wants to be the best in town. That's our motto, to be a locally-based company. So that the main axis is that even though the U.S. tariff policy might change, our axis and policy will not change. As I said, that in the long term, that the local production, local development will be emphasized. In the short term... to the actual demand, the optimal response and operation should be devised. So these are the combination of efforts we will make to deal with the change.
Speaker Change: Okay.
Speaker Change: And about <unk>.
Speaker Change: Well.
Speaker Change: I apologize to the people raising their hand in this venue, but we would like to take questions from people online at this juncture.
Speaker Change: Okay.
Speaker Change: One.
Speaker Change: <unk>.
Speaker Change: As we have continued to decrease on cost.
Speaker Change: And then we will come back to this thing you again later on.
Speaker Change: Other variation units I believe we'll be able to produce.
Speaker Change: Produce profits.
Speaker Change: Oh go ahead.
Speaker Change: Okay.
Speaker Change: I will be repeating myself, but we will do what we have to do now and we.
Speaker Change: Have any questions.
Online. Please just raise your hand button.
Speaker Change: <unk>.
Speaker Change: Please turn on your microphone and camera if you were called upon to speak.
Speaker Change: To further strengthen our earning power.
Speaker Change: Yes.
And even though they may start.
Speaker Change:
Speaker Change: Uh huh.
Speaker Change: Hello.
Speaker Change: Tariffs Lucky son from Best Clark.
Speaker Change: Oh no no no.
I mean, I think from them.
Speaker Change: No.
Speaker Change: That person was a great check it.
Speaker Change: Please turn on your microphone and camera before you speak.
Speaker Change: The TV Tokyo I have a question to Mr. Sato two questions. One is that the target production volume this year that the external environment is getting difficult, but the 10 million units have been already.
Yoichi Miyazaki: On the other hand... The tariffs, would that be eternal ones, permanent ones? We are not in a position to decide on the tax tariff policy. So whatever the situation will change, we have to be flexible to deal with and then we will maintain our basic pillar and policy on the course and then deal with the situation.
Ted: This is Ted a sucky from this car.
I have two questions.
Speaker Change: Slide 11.
Speaker Change: Six months ago, Mr Music should the production plan has been prepared and the OEM has a duty to.
Speaker Change: You talk about our sales volume forecast by region.
Speaker Change: [noise] terrorists and exchange rate impact was large you mentioned, one Chilean yeah, and I think but.
Speaker Change: Study reproduced according to targets, but in a more difficult environment to 10 million units were still launched what's the purpose of this 10 million unit announced do group collaboration the way you should be that's my second question, they too dangerous to seasonal talked about debt to go private so.
Yoichi Miyazaki: Three million units of volume maintained in Japan. To do that, as I said, we should strengthen our foundation. That is a strong activity. To maintain the domestic production level, that strong foundation is crucial. In other words, so-called. Oh, well, like we support and invest for the suppliers, but it's not that to return the money back to them, but rather in order for them to further improve the productivity and have the spare room, we just work so closely with the suppliers. It's a work together. So we now have the high level of the production operation in place.
Speaker Change: If you look at sales volume to the to North America.
Speaker Change: 2.94 million for next year is your forecast.
Speaker Change: The Toyota Group you have a policy based share of cross shareholdings, all the way to the group's infrastructure should be the way it should be what do you think of including the potential real more of a multitude of industry going private.
Speaker Change: Compared to this year.
Speaker Change: It is an increase of over 200000 units.
Speaker Change: Hum.
Speaker Change: Mr. Neil Zaki talked about.
Speaker Change: Thank you.
Speaker Change: For your question.
Speaker Change: Back orders.
Speaker Change: But.
Speaker Change: So about the production.
Speaker Change: Are there any other factors that lead to this increase.
Speaker Change: Volume, Tim median unit announced and what's the aspiration for that.
Speaker Change: Please tell us about the basis of this number.
Compared to the previous determined the Doctor pro forma sued you produce strategy and properly is that is the base is an important factor to maintain the profitability.
Speaker Change: That is the first question.
Yoichi Miyazaki: Just so maybe the people in the field, the workplace might not have the enough energy or the spare capacity to improve further. So we should give them the spare room and energy and capacity so that they can work better. So we will create a good climate and environment for them to do that. So it's not just a funding support for them and return the money back to them, but in the mid to long term, it will eventually boost our productivity together and further reduce the cost incurred. And then effectiveness will be improved. And then eventually the total competitive edge will be further enhanced.
Speaker Change: Maybe we should take the second question first.
Speaker Change: Can you give us the two questions together.
Speaker Change: Profitability. So we focused in the last one year to further strengthen our foundation.
Speaker Change: Now to my second question.
Speaker Change: Also on page 11.
Speaker Change: He's amines and <unk>.
Speaker Change: 10 million units, we worked so hard to strengthen our foundation.
Speaker Change:
Speaker Change: You talked about breakdown of our sales volume.
Speaker Change: And the outcome results.
Speaker Change: And our foods have deemed are being on the call.
Speaker Change: Bye.
Types of vehicles, 213% for B E S.
Speaker Change: In other words, the production has become stabilized.
Speaker Change: And the proof of produce a high quality vehicle and deliver to our users. That's a one of the important target for us and.
Speaker Change: Three.
<unk> hundred 10000 is the number that you have a this is a big forecast, but if you as of 2023.
Speaker Change: For example, about doing this meant that.
You announced the plan was the easy 1.5 million by 2026 was the number that you gave us.
Yoichi Miyazaki: So domestic production level should be maintained by the protection. We will strengthen our productivity and then competitiveness. And that, I think, is a very important cycle we'd like to achieve.
Speaker Change: The total comprehensive reimbursement for human capital in the last several years, who example.
Speaker Change: <unk>.
Speaker Change: The production line.
So in one year five times as many of them would be very difficult. It will you be reviewing your plan well. According to media reports of some people say that you have already reviewed the plan, but are you in the process of review.
Speaker Change: Operation might stop sometimes you need a maintenance work without them freaking to repair it might be necessary in some of the facilities, So maybe upgrading and.
Yoichi Miyazaki: Thank you very much.
Operator: Thank you very much to Mr. Yao in the middle.
Speaker Change: Reimbursement for that is quite important and it's a big.
Kawaguchi: third from the front row Kawaguchi from Nikkan Kogyo.
Speaker Change: Conditions are so.
Speaker Change: So the question is about the easy sales.
Speaker Change: So the frequency the production line has to be stocked and no. It doesn't have to stop it's a kaizen improvement which has been achieved in the last several years. So you don't have to stop the production that is a bit of efficiency of the production. So that kind of these are in advancing this meant has borne fruit and then.
Let's use that as my second question.
Kawaguchi: Except for tariff impact, fiscal 2025, what kind of year will it be? How do you position this year?
Tom.
Speaker Change: Thank you very much to your question is no that is again a first.
Kawaguchi: A major transformation in a century. It's been several years since this has been discussed and diversification and localization, you are working on these, but how is business going to be this year towards 2030?
Speaker Change: Our first question.
Speaker Change: And last year in North America.
As I mentioned in my presentation, the Indiana plant.
Speaker Change: You could have a very good quality and.
Speaker Change: Yes.
Okay.
Speaker Change: Efficient production, which have shown just to strengthen the foundation that is the basis and that's why we are still quite aware of this.
Speaker Change: Because of quality issues had to stop production.
For a long time, but this year.
Kawaguchi: And my second question is about earning power. On the hybrid side... Profitability is almost equal to gasoline cars. I think it was last year that Mr. Miyazaki talked about 5 million hybrid vehicles. So does this milestone, is this milestone unchanged?
Speaker Change: This factor will be gone so.
Speaker Change: Do you need to target and that junior to us we're important to support and protect our supply chain from that standpoint, do we put it as a threshold.
Speaker Change: Indiana factory production will be back to full operation and.
But who knows.
Speaker Change: The targets and then we'd like to continue our efforts. So that we can continue to steadily produce high quality vehicles.
Speaker Change: Four.
Speaker Change: Vehicles for which we have bad quarters, we'll be able to see increasing production.
Speaker Change: But as I mentioned before there may be.
Speaker Change: And second point is the collaboration among the two the group companies.
Many other changes so we may not have been able to forecast everything but at this moment. This is the numbers that we have in mind, but as the situation changes, we are intending to make adjustments as necessary.
Yoichi Miyazaki: So, um, and what about your plans for improvement for PHD? Thank you very much for your question. The Positioning of Fiscal 2025, as I mentioned in the presentation. this year. in a sense. It's a year where, globally, We are now seeing the speed towards electrification in each region. So, depending on the region, the speed, or how electrification will develop, will be a clear. In case of battery EVs, in the past we discussed this on a global basis. Obviously now that China is moving fast, and not only electric vehicles, but intelligence plus EV is pushing forward.
Speaker Change: And of course.
Speaker Change: We'd like to transform to a mobility company. That's a grant Inc. And an entire group is trying to become a mobility company.
Speaker Change: And then that's a challenge come and challenge for all of US how should we be prepared.
That's right.
So each vehicle should be sold and delivered to our customer with the attention to detail.
Speaker Change: The information, we need to achieve disclosure I personally feel that.
Speaker Change: And as.
And some of those efforts.
Speaker Change: The productivity and efficiency should be increments.
Speaker Change: Who we are hoping will lead us to achieve those numbers.
Speaker Change: We proved the not just the vertical integration might be beta it's more efficient to have a vertical integrated organization, but we aim at.
Speaker Change: Okay.
Tariffs lucky's onto your second question. This is Sato speaking there I will respond to that second question.
Speaker Change: Long term I knew that based our crews and so that the automotive industry should continue to do you track this growth.
Speaker Change: There's a whole lot about.
About the best sales plan.
An increase of more than 150000, new vehicle impact can.
Speaker Change: So this is each company Regina do the group should have reached to lose strength within the what is the strength of the company we didn't get entirely to the group and then that the signature goes in meaning it's going to be prudent. We are the vehicle supplier that is a T. M C.
Speaker Change: Can be incorporated.
So there will be vehicles launched and announced it and.
Speaker Change: Outlook for those is the basis.
Yoichi Miyazaki: the mobility, so. So a battery EV leading-edge technology will be incorporated so that we can push forward mobility. In the case of battery EVs, we will be delving deeper into this area. And for hybrids... Realistically speaking... We are seeing a shift to BEVs, but having said that, there are many ways to realize carbon neutrality. So an approach that combines vehicles with carbon neutrality will be very important. So from the fuel side, carbon neutrality... will have to be realized. It will be a very important turning point towards that. So hybrid, PHEV will be the pillar. But.
Speaker Change: <unk> 5 million in 2030, or one 4 million in 2026.
Speaker Change: D G M C E W.
Speaker Change: Those are the numbers that we have announced before but.
Speaker Change: Is supported by different domains and each member companies has its own D aspiration to achieve a certain cool and seal of each group. The group companies I think are trying to set those goals.
Speaker Change: The basis of our calculation is a real demand.
So real demand, but real demand oil changes so if the peso field demand changes based on those changes. So we will be changing those reference numbers, especially PREPA.
Speaker Change: I'm the CEO and.
Speaker Change: Mr. Toyota is Oh, Anita the chairman of the entire group and he's message an aspiration, it's the basis of workforce and we'll continue discussions.
Preparation of the supply chain and investment timing.
Speaker Change: Are things that we have in mind, when we came up with these numbers.
Speaker Change: Within our group.
It was on the industries and how it's positioned well because he's the original company Oh the G. M. C. So it's a very important company historically and we need the T. M Z group the severe important to do the full grifters was aging and the other businesses as well.
Speaker Change: Battery E D.
The real demand is starting to be clearer so.
015 million is a number that will be reviewed.
Speaker Change: Thank you very much.
Yoichi Miyazaki: In addition to that, carbon neutral fuel will be combined. So that kind of practical solution will be accelerated. That will be very important. So, in a sense... The basic pillars remain unchanged, but the resolution of each element will be higher than before.
Morris.
Speaker Change: So it's a the important to run with important companies within a day.
Speaker Change: I would like to entertain another person.
Oh hi.
Speaker Change: <unk> group so the position stays the same.
Speaker Change: From new Schiavo shrunk.
Please turn on your microphone and camera.
Speaker Change: Okay.
Matt: Matt clarify one point 10 million units are there targets use it did no external environment. He said deteriorating you produce 10 million units and do how 'bout Youku global economy that you can still sell these many vehicles do you intend to produce maybe news to me is that you can add.
Josh please.
Yeah.
Speaker Change: Yes.
Speaker Change: Yeah.
I think you can you hear me well, yes. Thank you I have a question about the U S. In China I have one question to each country about each point the first point is that USA.
Yoichi Miyazaki: There is another point that we focus on, which is creating an environment or ecosystem. Just pushing forward evolution of the vehicle does not lead to realization of mobility, battery EVs, hydrogen... requires energy infrastructure and the legal framework. mobility of cars alone. will not allow us to push forward a mobility society and so a comprehensive approach is necessary which means that we have to work with energy or IT industry people. and we also have to work with government. to create the environment. and that will be the foundation.
Matt: And also the outlook for the global economy, we cannot define the global economy College however.
It's a direct question.
Matt: However, we do.
Earlier, you already mentioned that the mid to long term versus the short term how you prepare yourself to potential terrorists in the mid to long term outlook that you provided this suite of products to local customers, which are the best in town.
Do we have a regional headquarters system in each region, we have a seal and do we discuss some of the global economy and the reason that you're going to look to come to over answer so.
Speaker Change: Oh, Duke wise 10 million units.
Speaker Change: And Ah go back to.
She was a local production if the tariff rules stay permanent production capacity locally should be enhanced or you might have to build the new plants.
Speaker Change: The work towards it but it's not just the targets.
Speaker Change: The basic standard sort of.
Speaker Change: Of course too.
Speaker Change: It's not really the goal or target to achieve so please understand the nature of this 10 million units.
Speaker Change: Is it possible scenario.
My first question.
Speaker Change: The second question is question about China.
Speaker Change: And in the past.
So the training materials talking about China, you on your conversion 94, 1% there was a number but in terms of the shift in the last several years.
Speaker Change: I already told you but.
Speaker Change: In many regions, we like to strike a good balance in man and the good business in each region that is a strong weapon for our companies to achieve stable business and pushed ability.
Yoichi Miyazaki: And this year, we have to focus more on creating this foundation.
He did a logo the company is getting strong and you are having difficulty, but you will be launching emphasizing your efforts in China to recover your activity what's the strategy.
Yoichi Miyazaki: Now, earning power will be discussed by Mr. Miyazaki. In the past and this year, as everybody is pointing out, it is The future is unclear, uncertain. But in this environment, what we have to do is to make sure we continue to produce and making happiness for all. Maintaining 3 million in Japan and full operation of overseas plants is necessary and we have to make sure we continue to produce ever better cars. Going back to the basics. and doing what we have to do is what we will do in 2025 for this year's forecast 3.8 trillion will be the starting point but from here we want to build up so that we can realize more.
Speaker Change: Therefore in particular region.
Speaker Change: It catches a cold and maybe the remaining healthy regions Kim can complement or supplement for each other so the increases.
Speaker Change: Taking into account the change of environment.
Speaker Change: It did do very active region versus the seek region. The vehicle demand is might not match.
Oh, the competitiveness in Chinese market, so what's your outlook in China.
Thank you for your question.
Speaker Change: I think E two regional markets and markets will calibrate among themselves and then we tried to strike the balance between supply and demand so that the disk systems and structure can be stable. They operate it so that we'd like to work harder with our suppliers naturally.
Speaker Change: Thank you Jonas for your question the first is it.
Mid to long term outlook now.
Naturally.
Speaker Change: It's being not doing this for some time in the USA, we have U S MCA pitch.
Speaker Change: 10 million units is not the end of it all we are not aiming at achieving this target we have to build a good car one by one and eventually it might achieve 10 million units. So we like to do.
Speaker Change: Is the local production.
Do you go with the target to increase the logo of the procurement the level. According to the rule and then so local production and it'll go supply and that the logo the supply the percentage ratio should be increased steadily from PCB standpoint.
Speaker Change: Keep to do care to build a good quality golf with each customer and user.
Speaker Change: Okay.
Speaker Change: Even though some eastern a curse at the local production still possible not just vehicles or units as well.
Speaker Change: Thank you very much.
Speaker Change: Okay.
Speaker Change: Well.
Speaker Change: I apologize to the people raising their hand in this venue, but we would like to take questions from people online at this juncture.
Yoichi Miyazaki: I mentioned 3.8 trillion but tariff except for tariff and exchange rate it will be 1 trillion that will be 1 trillion so 4.8 trillion in earning power is something that we can realize so how to step up from there is something that we want to think about we want we need to create products that meet the real demand of our customers for hybrid vehicles. I mentioned before that real demand is very strong so initially in 2026 5 million production something that I mentioned and I talked about bringing this plan forward but after that we decided to focus on securing the foundation so we stopped for a while to reorganize development and production so for hybrid Last year, as was mentioned before, plus 850,000 compared to the previous year is what we realized, but this year we expect a growth of 5%, so 4.7 million is what we expect.
Local production.
Production local procurement should be further promoted we've been doing this for some time, but because of that.
Speaker Change: And then we will come back to this thing you again later on.
Speaker Change: Even though the tariffs is there its not the efforts we've been doing something we should do and then we study performed a duty that's something we intend to do as a result.
Speaker Change: Hi.
Speaker Change: Oh no.
Speaker Change: Oh go ahead.
Have any questions from online. Please just raise your hand button.
Speaker Change: Please turn on your microphone and camera if you were called upon to speak.
If the things go smoothly, we might accelerate that auction.
Speaker Change: Uh huh.
Speaker Change: As I said everything is not 100% predictable within that uncertainty yeah, we should not trade from a long way to other but we will take our study one and staying the course and make a final decision. According to this one is doing.
Ted: Ted I was lucky son from Best Clark.
Speaker Change: Mike.
Speaker Change: Please turn on your microphone and camera before you speak.
Ted: This is Ted a sucky from this call.
Yeah.
Speaker Change: As to the China, Let me respond.
Speaker Change: I have two questions.
China.
Ted: Slide 11.
Speaker Change: What are those.
Ted: You talk about our sales volume forecast by region.
Ultra cool on China, China, China is not one.
Speaker Change: Market, but rather.
The $1 4 billion population in China.
Ted: Terrorists an exchange rate impact was large you mentioned, one Chilean yeah, and I think but.
Speaker Change: Not in a position to.
Yoichi Miyazaki: So, the original 2026 numbers is the plan that we had, but how to fund forward that plan is something that we will continue to work on, and we want to accumulate our earning power as we do so, and about PHEVs, Once we, as we have continued to decrease on cost Other variation units, I believe, will be able to produce profits. I will be repeating myself, but we will do what we have to do now, and we want to further strengthen our earnings.
Take care of all those people.
Ted: If you look at sales volume to the two North America too.
This is a we are not in that position so from that standpoint, the local coastal areas.
Ted: 2.94 million for next year is your forecast.
The big cities are the population, we'd like to target.
Ted: Compared to this year.
Ted: It is an increase of over 200000 units.
Speaker Change: That is where the real focus in terms of the Sigma into Chinese market.
Ted: Okay.
Speaker Change: That sense.
Ted: Hum.
Speaker Change: Naturally.
There are local manufacturers and suppliers in China Oems are very strong in certain provinces or regions. So the Chinese market should be scrutinized by the Ah <unk>.
Ted: Mr Miyazaki talked about back orders.
Ted: But are.
Speaker Change: Are there any other factors that lead to this increase.
Speaker Change: Details by region in Russia, So we should avoid the direct competition, but there are certain and then.
Speaker Change: Please tell us about the basis of his Thunder.
Speaker Change: That is the first question.
Lots of areas, where we can co exist with the Chinese on structures. So in the Chinese situation of course, the market shares that.
Speaker Change: Maybe we should take the second question first.
Speaker Change: Can you give us the two questions together.
The units and volume.
Speaker Change: Now to my second question.
Speaker Change: Targets are achieved thanks to the suppliers and so forth.
Operator: The person with the gray jacket.
Speaker Change: Also on page 11.
Operator: I'm a radio TV Tokyo. I have a question to Mr. Sato. Two questions. One is that the target, the production volume of this year, that the external environment is getting difficult, but the 10 million units have been already mentioned. The group collaboration, the way it should be, that's my second question.
Speaker Change: The theaters there.
Speaker Change: You talked about breakdown of our sales volume by.
Speaker Change: Profitability in China.
Speaker Change: We've been telling you.
Speaker Change: In our Chinese business, our profitability level is highly evaluated compared to the local competitors Oh level is on par with the Chinese competitors. So that's how evaluate their Chinese business performance.
Speaker Change: Types of vehicles 213 per cent for E S.
Speaker Change: Three.
Speaker Change: 110000 is the number that you have a this is a big forecast, but if he is as of 2023.
Should we leverage further in the future.
Speaker Change: Last month at the <unk>.
Speaker Change: You announced the plan was the E V 1.5 million by 2026 was the number that you gave us.
Speaker Change: The development of structure will be enhanced in China. So the bib suitable for Chinese customers will be launched in the <unk> run through the brands will be.
Speaker Change: So in one year five times as many of them would be very difficult. It will you be reviewing your plan well. According to media reports. So some people say that you have already reviewed the plan, but are you in the process of review.
Sato: The Toyota industry is now talked about to go private. So the Toyota group, you have a policy-based cross-shareholding. So the way the Toyota group structure should be, the way it should be, what do you think of including the potential rumor about the Toyota industry going private? Thank you for your question. So about the production, the volume, 10 million units announced and what's the aspiration for that? Well, compared to the previous term that the actual performance showed, you produce steadily and properly. That is the basis and important factor to maintain the profitability. So we focused in the last one year to further strengthen the foundation.
Speaker Change: Asked and protects it.
Speaker Change: Sure.
Speaker Change: Okay.
Speaker Change: Hi, Sean.
Speaker Change: Thank you very much.
Speaker Change: Now going back to this room we.
Speaker Change: So the question is about the EV sales.
Speaker Change: We will take questions from people in this room again.
Speaker Change: She is that as for my second question.
Speaker Change: Okay.
Speaker Change: Thank you very much to your question is does that is that a first.
Speaker Change: Yeah.
Speaker Change: In the middle.
Speaker Change: My first question.
Speaker Change: And last year in North America.
Speaker Change: The person from the SEC in the second row.
Speaker Change: As I mentioned in my presentation, the Indiana plant.
Speaker Change: It comes from.
Speaker Change: Yes.
Speaker Change: I'm using my Chi from Nick on automobile.
Speaker Change: Because of quality issues had to stop production.
Speaker Change: I have a question about the Japanese market less fear there was a certification issue and CT quality issues are leading to long lead time.
Speaker Change: For a long time, but this year.
Speaker Change: This factor will be gone so.
Sato: What is the mean of the 10 million units? We worked so hard to strengthen the foundation. And as the outcome results, and food has been copped, in other words, the production has become stabilized. and produce a high quality vehicle and deliver that to our users that's one of the important targets for us. For example, the total comprehensive investment for human capital in the last several years, for example, includes in the production line the operation might stop. Sometimes you need maintenance work or sometimes frequent repair might be necessary in some of the facilities. So maybe upgrading and the investment for that is quite important and it's a big investment as well.
Speaker Change: Indiana factory.
Speaker Change: And low production, but if you look at this year.
Speaker Change: <unk> will be back to full operation and.
Speaker Change: But who knows.
Speaker Change: We have some negative numbers can you tell us about.
Speaker Change: Four.
Speaker Change: Vehicles for which we have bad quarters, we'll be able to see increase in production.
Speaker Change: The background.
And.
Speaker Change: Okay.
Speaker Change: 3 million production in Japan in order to maintain that at least half of that number should be sold in Japan, but over the medium to long term what is your outlook about the domestic market.
Speaker Change: But as I mentioned before there may be.
Speaker Change: Many other changes so we may not have been able to forecast everything but at this moment. This is the numbers that we have in mind, but as the situation changes, we are intending to make adjustments as necessary.
Speaker Change: Where do you like Sun is it just one question.
David: Thanks, David.
Yeah.
David: So each vehicle should be sold and delivered to our customer with the attention to detail.
Speaker Change:
Speaker Change: About our sales are in the Japanese market of course.
David: And as.
David: And some of those efforts.
We have a model lifecycle.
David: Who we are hoping will lead us to achieve those numbers.
Speaker Change: When you go to the peak.
Sato: So the frequency that the production line had to be stopped but now it doesn't have to be stopped. It's a Kaizen improvement which has been achieved in the last several years so you don't have to stop this production line. That is a better efficiency of the production. So that kind of this in-advance investment has borne good fruit and then you could have a very good quality and efficient production which has shown this strength in the foundation. That is the basis and that's why we are still quite aware of this unit target. And that unit is so important to support and protect our supply chain.
Speaker Change: He will be a stable period and then.
David: Dennis Lucky's onto your second question. This is Sato speaking there I will respond to that second question.
Speaker Change: There are some differences in numbers, but basically we are aiming at a $1 5 million being sold so.
Speaker Change: About the best sales plan.
There is no strong lille or background here.
Speaker Change: An increase of more than 150000, our new vehicle impact.
Speaker Change: Can be incorporated.
Speaker Change: In.
Speaker Change: So there will be vehicles launched and announced that and.
Speaker Change: Thinking about the motto life cycle, we came up with these numbers now about the medium to long term outlook.
Speaker Change: Outlook for those is the basis.
Speaker Change: It has always been said that in Japan. The population is declining and the birthrate is declining but the how to reduce the vehicle replacement cycle is something that we.
Speaker Change: People. Unfortunately in 2030 or one 5 million in 2026 are those are the numbers that we have announced before but.
Sato: From that standpoint we put it at the threshold in the target and then we like to continue our efforts so that we can continue to steadily produce high quality vehicles.
Speaker Change: The basis of our calculation is a real demand.
Speaker Change: We want to work on it to revitalize the jeopardy, smart kitchen attractive cars will have to be launched and.
Speaker Change: So real demand, but real demand oil changes so if the peso fill demand changes based on those changes. So we will be changing those reference numbers, especially.
Sato: And second point is a collaboration among the Toyota group of companies. And of course, we like to transform to a mobility company, that's our grand aim, and an entire group is trying to become a mobility company. And that's a challenge, a common challenge for all of us. How should we be prepared and what kind of information we need to achieve this goal? I personally feel that the productivity and the efficiency should be improved. Then just a vertical integration might be better. It's more efficient to have a vertical integrated organization. But we aim at the long-term annular-based growth so that the automotive industry should continue to track this growth path.
Speaker Change: In order to make them a replacement cycle and shorter we have to work more too.
Speaker Change: Sell them in a better way, so, including Kindle and other initiatives, we will continue to.
Speaker Change: Preparation of the supply chain and investment timing.
Speaker Change: Yes.
Try new effort.
Speaker Change: Are things that we have in mind, when we came up with these numbers.
Speaker Change: Let me add something thank you very much for your question. Your question was about the future of the Japanese market as Mr. Like me as I cant mentioned.
Speaker Change: Battery E D.
Speaker Change: Real demand is starting to be clearer so.
Speaker Change: How can we produce and deliver cars that people would want to buy if the vehicles are produced are based on a traditional thinking.
Speaker Change: 015 million is a number that will be reviewed.
Speaker Change: Thank you very much.
Speaker Change: Scott.
Speaker Change: Or still got that I would like to entertain another person Oh my.
Speaker Change: Now, we just launched a new crowd series, but 10 years ago, our crown was in Fr Sudan and authentic product that was the stereotype image you all see model Crown.
Speaker Change: From new Schiavo shrunk.
Speaker Change: I'm pleased to turn on your microphone and camera.
Speaker Change: Josh song please.
Sato: So in that sense, each company within the Toyota Group should have its own strength. Within the group, what is the strength of that company within the entire Toyota Group? And then the significance and meaning is quite important. We are the vehicle supplier. That is the TMC. But the TMC, the vehicle producer, is supported by different domains, and each member company has its own aspiration to achieve a certain goal. And the CEO of each group of the group companies, I think, are trying to set those goals. Of course, I'm the CEO of the TMC, Mr. Toyoda is the leader, the chairman of the entire group, and his message and aspiration is the basis of our efforts, and we will continue discussions within the group.
Speaker Change: Yes.
Speaker Change: Sure.
Speaker Change: Yeah.
Speaker Change: But.
Speaker Change: Yes.
Speaker Change: What is the significance of crown being along seller that is something that we reviewed and you're going to come up with a new product so the old.
I think you can you hear me well, yes. Thank you I have a question about the used in China I have one question to each country about each country. The first point is the USA.
Speaker Change: Rather than looking at the old framework, what is necessary now in this market is something that we have to face we are calling acre. So we need to produce cars that people would want to.
Speaker Change: It's a direct question earlier.
Speaker Change: Earlier, you already mentioned that the mid to long term versus the short term, how you prepare yourself to potential terrorists in the.
Speaker Change: Purchase in Japan.
Speaker Change: Do long term.
Speaker Change: To come up with ideas to launch there are some products that we need to solidify the foundation come up with the extra capacity. So that we can produce cars that are suitable for the local market.
Speaker Change: That you provide.
Speaker Change: <unk> two <unk>.
Speaker Change: <unk> customers.
Speaker Change: Tom.
Speaker Change: Sue is a local production if the tariff war stay permanent production capacity locally should be enhanced or you might have to build the new plants.
Speaker Change: Thank you very much to me he said lucky.
Speaker Change: Is it possible scenario and that's my first question.
Speaker Change: It's gotten much better at that.
Sato: The industries and how it's positioned. Of course, it's the original company of the TMC, so it's a very important company historically, and within the TMC group, that it's very important to do the forklift as well as the engine and other businesses as well. So it's one of the important companies within the group, so their position stays the same.
Speaker Change: Time is running short so we'd have to entertain just one last question if we may.
Speaker Change: The second question is question about China.
Speaker Change: Turning to mature you're talking about China you in your comparison ninety-four bring 1% there was a number but in terms of share in the last several years.
Speaker Change: Yeah.
Speaker Change: They have a person in the hunt.
Speaker Change: Six of them almost all of our freedoms. So John list earlier in the presentation, you talked about the multi pathway strategy, which will be unchanged.
Speaker Change: Did the local companies getting strong and you are having difficulty.
Speaker Change: It is a strong area, it's doing quite well on the other hand positive as opposed to covert the BPH B is not really not growing as you expect it's hydrogen vehicle.
You will be launching emphasizing your efforts in China to recover your activity what's the strategy.
Yoichi Miyazaki: May I clarify one point? 10 million units, the target you said, the now external environment is deteriorating. You produce 10 million units, and do you have outlook of global economy that you can still sell these many vehicles you intend to produce? Maybe Mr. Miyazaki can add. The outlook of the global economy, we cannot define the global economic outlook. However, we have a regional headquarter system, and in each region we have a CEO, and we discuss the global economy and regional economic outlook to come to our overall outlook. So our own outlook wise, 10 million units, aim, a goal, we'd like to work toward.
Speaker Change: Taking into account the change of environment.
Speaker Change: A sofa you a boost.
Speaker Change: Of the competitiveness in Chinese market, so what's your outlook in China.
Speaker Change: Spirit, but maybe just there's a toning down about the hydrogen vehicles.
Speaker Change: Thank you for your question.
Speaker Change: But.
Jonas: Thank you Jonas for your question. The first is a mid to long term outlook now.
Speaker Change: I feel so hydrogen engine might be applied to motor sports and it's been five years since you apply that and then that towards the end of the year. If we do 24 hour race. This a hydrogen vehicle is to.
Speaker Change: Naturally.
Speaker Change: It's being not doing this for some time in the USA, we have U S. M C H, which is the local production.
Speaker Change: Do you participate at that time you Mr. Sutton was a prisoner to launch the hydrogen engine for the Motorsports, what's the progress to date of the hydrogen engine. Another question.
Do you go with the target to increase the local procurement the level. According to the rule and then so local production and it'll go supply and that the logo the supply percentage ratio should be increased steadily from DCP standpoint.
Speaker Change: Are you talking about just a group of Google strategy, you are supplying just a suitable car to each region on the other hand.
Speaker Change: The enjoyable.
Speaker Change: Even though some eastern a curse at the local production still possible not just vehicles or units as well.
Yoichi Miyazaki: But it's not just a target, it's like the basic standard sort of. Of course, it's not really the goal or target we'd like to achieve, so please understand the nature of these 10 million units. In the past, I already told you, but... In many regions, we like to strike a good balance and good business in each region. That is a strong weapon for a company to achieve the stable business and profitability. Therefore, in a particular region, if it catches a cold, maybe the remaining healthy regions can complement and supplement for each other. So in case the very active region versus the sick region, the vehicle demand might not match, then I think each regional market and markets will collaborate among themselves.
Speaker Change: Experience at a wow experience that got that kind of car that the Mr satellites Wow experience to give them buy a car.
Speaker Change: The logo D D.
Production local procurement should be further promoted we've been doing this for some time, but because of that.
Speaker Change: So it's sort of like this.
Speaker Change: Lately, we don't really see menu new models developed by us, which is suitable for that Oh Wow experience.
Speaker Change: Okay.
Speaker Change: Even though the tariffs is there its not the efforts we've been doing something you should do and then we study performed a duty that's something.
Speaker Change: About demand the pathways strategy, yes, we will maintain that.
Speaker Change: Our strategy.
Speaker Change: And as a result of this the extra.
Speaker Change: D C.
Speaker Change: She will be further advanced and then the hybrid system will become more efficient and then we will continue these technologies you Bergman for smaller compact car with a higher efficiency and those are the output to the characteristics should be further enhanced that technology is being promoted so that's a powertrain evolution.
Speaker Change: Things go smoothly, we might accelerate that auction.
Speaker Change: Everything is not 100% predictable we deemed that uncertainty yeah, we should not trade from a long way to other but we will take our study one and staying the course and make a final decision. According to this one is doing.
Speaker Change: It should be driven and we'd like to continue that effort in that area on the other hand.
Speaker Change: Understood the China, let me respond on China.
Yoichi Miyazaki: And then we try to strike the balance between the supply and demand so that this system and structure can be stably operated, so that we like to work harder with the suppliers naturally. Ten million units is not the end of it, or we are not aiming at achieving this target. We like to build a good car, one by one, and eventually it might achieve ten million units. So we like to give due care to build a good quality car for each customer and user.
Speaker Change: In a way Shaw and energy Mike.
Speaker Change: I don't know what it looks like Oh, just on China.
Speaker Change: Does it make a difference in terms of where we emphasize the or the pathway towards the equivalent of origination. So the energy availability might make a difference I feel especially of hydrogen.
Speaker Change: Chinese China is not the ones on the market, but rather.
Speaker Change: The $1 4 billion population in China.
The major challenge for hydrogen is the hydrogen itself.
We are not in a position to.
Speaker Change: They take care of all of those people.
Speaker Change: We are picky about its origin and hydrogen becomes such an expensive energy source energy cost is so expensive, it's too expensive to put it otherwise.
Speaker Change: This is a we are not in that position so from that standpoint, the local coastal areas that.
Speaker Change: The big cities are the population, we'd like to target.
Operator: Thank you very much.
Speaker Change: That is fair that the real focus in terms of the Sigma into Chinese market so in that sense.
Speaker Change: It's a barrier for preparing musician so in order for us to promote that.
Operator: I apologize to the people raising their hand in this venue, but we would like to take questions from people online at this juncture. And then we will come back to this venue again later on. So, if you have any questions from online, please use the raise hand button. Please turn on your microphone and camera if you are called upon to speak.
Speaker Change: The hydrogen use should be increased first that is an initiative, we first have to take.
Speaker Change: Naturally.
Speaker Change: Now there are local manufacturers and suppliers in China Oems are very strong in certain provinces or regions. So the Chinese market should be scrutinized by the meeting.
Speaker Change: Oh for the passenger car a reward, but six two times or more on the.
Speaker Change: Sensitivity for the commercial vehicle one the heavy duty truck versus the small passenger cars the size or the.
Speaker Change: Details by region in Russia, So we should avoid the direct competition, but there are certain and then.
So the areas, where we can co exist with the Chinese on structures. So in that the Chinese situation of course, the market shares that.
Speaker Change: Scale is 64 different so that we are trying to make efforts in commercial vehicles as well. So the cost reduction efforts should be made they've finally, the technology or the hydrogen engine could become quite useful.
Terasaki: Terasaki-san from this car. Please turn on your microphone and camera before you speak.
Speaker Change: The units and volume.
Speaker Change: Targets are achieved thanks to the suppliers and also.
Speaker Change: Engineers' combustion.
Speaker Change: So the data is there and so the profitability in China, if you've ever been telling you.
Speaker Change: Control is already in our in house technology, So efficiencies one challenge and another one.
Terasaki: This is Terasaki from BISCAR. I have two questions. Slide 11. You talk about a sales volume forecast by region. tariff and exchange rate impact was large. You mentioned 1 trillion yen, I think, but if you look at sales volume to North America, 2.94 million for next year is your forecast. compared to this year. It is an increase of over 200,000 units. Representative, Masahiro Yamamoto, Yoichi Miyazaki, Hayakawa shuntaro, Ikeda Miyo, Akio Toyoda, Sho Nagai, Sugito Ouchi, Toyota Mr. Miyazaki talked about, um, backwaters. but are there any other factors that lead to this increase? Please tell us about the basis of this number.
Speaker Change: In our Chinese business and improved stability level.
Speaker Change: The combustion of the hydrogen.
Speaker Change: Heidi you probably did compare to the local competitors Oh level is on par with the Chinese competitors. So that's how you voted their Chinese business performance.
Speaker Change: Issue, because the food I see that it's a.
Speaker Change: The combustion efficiency could be may be enhanced by the beta hydrogen combustion.
Speaker Change: Biofuels, if you're already there but it.
Speaker Change: Things should be limited further in the future, we announced last month that the.
Speaker Change: In the engine to go just because we do realize 100 technology, we have benefit to enjoy it.
Speaker Change: The development of structure will be enhanced in China. So the bib suitable for Chinese customers will be launched and it makes us run through the brands will be enhanced and protects it further.
Speaker Change: But that acuity technologies, so hydro and he gave us a good starting point, but eventually it will give us the synergy to really lead us to the multi pathway development. So standard on hydrogen shall not be scrutinized, but that's the starting point to lead us to dis synergy a multi pathway.
Speaker Change: Yes.
Speaker Change: Yes.
Speaker Change: Cash time.
Speaker Change: Thank you very much.
Speaker Change: Yeah.
Speaker Change: Now going back to this room.
Speaker Change: And so I think we now are seeing the physical site. So hydrogen is it just a kickoff of course liquid hydrogen is one area of how we work toward and work harder and I Hope you will continue to support us our China food is driving the car itself a hydrogen vehicle and she is a leading figure.
Speaker Change: We will take questions from people in this room again.
Speaker Change: Yeah.
Speaker Change: Yeah.
Speaker Change: Yeah.
Speaker Change: But.
Speaker Change: Yeah.
Speaker Change: In the middle.
Speaker Change: The person from the sick in the second row.
Terasaki: That is the first question.
Speaker Change: To promote the hydrogen society.
Speaker Change: He comes home section.
Speaker Change: So reed.
I'm using my T from Nissan automobile.
Terasaki: Maybe we should take the second question first. Can you give us the two questions together, now to my second question. also on page 11. You talked about breakdown of sales volume by types of vehicle, 213% for BEVs, three. Hiroyuki Ueda, Yoichi Miyazaki, Hayakawa shuntaro, Ikeda Mio, Akio Toyoda, Sho Nagai, Sugito Your announced plan was BEV 1.5 million by 2026 was the number that you gave us. So in one year, five times as many would be very difficult. Will you be reviewing your plan? Well, according to media reports, some people say that you have already reviewed the plan.
Speaker Change: We like to realize the hydrogen society and multiple or the simultaneous efforts are needed. So we will never give up to do that and we like to reassert our strong determination.
Speaker Change: I have a question about the Japanese market less fear there was a certification issue and a quote quality issues are leading to long lead time.
Speaker Change: The second point.
Speaker Change: And low production, but if you look at this year.
Speaker Change: Coffee induces allows spirit.
I appreciate your question.
Speaker Change: We have some negative numbers can you tell us about.
Speaker Change: Yes, I agree too exciting.
Speaker Change: Exciting vehicles is necessary the cost should be enjoyable.
Speaker Change: The background.
Speaker Change: And almost six months.
Speaker Change: Nick.
Speaker Change: Otherwise the car is not the car you don't just turn into quantity. So we have a determination that the car should never be looked at as a commodity. So the function was in logical thinking wasn't done based upon the left side of the brain.
Speaker Change: 3 million production in Japan in order to maintain that at least half of that number should be sold in Japan, but over the medium to long term what is your outlook about the domestic market.
Speaker Change: You cannot sell their products based upon the capital the vehicles you just.
Speaker Change: Okay.
Speaker Change: Where do you like Sun is it just one question.
Speaker Change: So nearly change doesn't know Murdo I'm, a research and have a new design or the engine. It won't sell anymore. So how passionate you are to produce a call feature triggered the essential burwell.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change:
Speaker Change: About our sales are in the Japanese market of course.
Speaker Change: We have a muddle lifecycle.
Speaker Change: Of course that of course, you have to the sharp shooting to have a PD.
Terasaki: But are you in the process of review? So the question is about BEV sales strategy. That is my second question.
Speaker Change: When you go to the peak.
Speaker Change: It's not a just a sports car for the ordinary cost as well.
Speaker Change: He will be a stable period and then.
Speaker Change:
Speaker Change: There are some differences in numbers, but basically we are aiming at a $1 5 million being sold so.
Speaker Change: Is still your passion to appeal to the customer to their heart.
Yoichi Miyazaki: Thank you very much for your question, Mr. Terasaki. First, your first question. Last year in North America, As I mentioned in my presentation, the Indiana plant Because of quality issues, I had to stop production for a long time. But this year, this factor will be gone. Indiana factory production will be back to full operation and For vehicles for which we have back orders, we'll be able to see an increase in production. But as I mentioned before, there may be... many other changes so we may not have been able to forecast everything but at this moment this these are the numbers that we have in mind but as the situation changes we intend to make adjustments as necessary So each vehicle should be sold and delivered to our customer with attention to detail and the sum of those efforts we are hoping will lead us to achieve those numbers.
Each project teams should share that says and I'm encouraging all of the projects team members to build such a car.
Speaker Change: There is no strong lille or background here.
Speaker Change: Really encouraging and Thats the way T M. She should be.
Yeah.
Speaker Change: In.
Speaker Change: Thinking about a muddle life cycle, we came up with these numbers now about the medium to long term outlook.
Speaker Change: That's my passion.
Speaker Change: And in this fiscal year, we'd like to work hard to achieve this goal.
Speaker Change: It has always been said that.
Speaker Change: Sure.
Speaker Change: To your question and you are thinking about the model.
Speaker Change: In Japan, the population is declining and the birthrate is declining but the how to reduce the vehicle replacement cycle is something that we.
Speaker Change: Great.
Speaker Change: As time is right, we will disclose that the new model to you, but I cannot disclose the name right now today at the brisk conference.
Speaker Change: We want to work on that to revitalize the Japanese market.
Speaker Change: So I've got another occasion.
Speaker Change: Attractive cars will have to be launched and.
Speaker Change: We could be ready to tell you in a nutshell this new exciting.
Speaker Change: In order to make the replacement cycle is shorter we have to work more too.
Yes.
Yamamoto: Thank you very much change to Yamamoto.
Speaker Change: No.
Speaker Change: Sell them in a better way, so, including Kindle and other initiatives, we will continue to.
Speaker Change: It is time, so that does conclude our Q&A session I would like to ask the three gentlemen to stand up.
Try new efforts.
Speaker Change: Thank you very much.
Let me add something thank you very much for your question. Your question was about the future of the Japanese market as Mr. Mike, Yes, I can't mentioned.
Speaker Change: Okay.
Speaker Change: I think for that night.
Speaker Change: Yeah.
Speaker Change: Yes.
Speaker Change: How can we produce and deliver cars that people would want to buy if the vehicles are produced are based on a traditional thinking.
Speaker Change: We conclude the financial results meeting for <unk>.
Speaker Change: Fiscal 2025, thank you very much for watching incoming.
Sato: Terasaki-san to your second question. This is Sato speaking. I will respond to that second question. about the Bez sales plan. In an increase of more than 150,000, a new vehicle impact can be incorporated. So there will be vehicles launched and announced, and the outlook for those is the basis. 3.5 million in 2030 or 1.5 million in 2026, those are the numbers that we have announced before but The basis of our calculation is real demand. So real demand, but real demand will change. So if the pace of real demand changes, based on those changes, we will be changing those reference numbers, especially preparation of the supply chain and investment timing.
Speaker Change: Now are we just launched a new crowd series, but 10 years ago. Our crown was in Fr Sudan, and authentic product that was the stereotype in nature of the model Crown.
Speaker Change: But.
Speaker Change: What is the significance of crown being along seller that is something that we reviewed and you're going to come up with a new product so the old.
Speaker Change: Rather than looking at the old framework, what is necessary now in this market is something that we have to face we are a car maker.
Speaker Change: So we need to produce cars that people would want to.
Speaker Change: Purchase in Japan.
Speaker Change: To come up with ideas to launch those products that we need to solidify the foundation come up with the extra capacity. So that we can produce cars that are suitable for the local market.
Speaker Change: Thank you very much to me send me some LNG.
Sato: are things that we have in mind when we came up with these numbers. Battery, EV, real demand is starting to be clear, so 1.5 million is a number that will be reviewed. Thank you very much.
Speaker Change: How much can they thought even time is running short so we don't go into things just one last question.
Speaker Change: If we may.
Speaker Change: They have a person in the hunt.
Speaker Change: Sam almost all of our freedoms. So John list earlier in the presentation, you talked about the multi pathway strategy, which will be unchanged.
Kiyadashi: I would like to entertain another person online, from NewsPix, Kiyadashi-san. Please turn on your microphone and camera. Can we hear a nice song, please? Thank you. Can you hear me well? Yes. Thank you.
Speaker Change: <unk> is a strong area, it's doing quite well.
Speaker Change: And frankly it was a perfect example.
Speaker Change: P. H b is not really not growing as you would expect if hydrogen vehicle.
Speaker Change: A sofa.
Speaker Change: You are trying to boost our spirit, but maybe that the disappointing down about T. A hydrogen vehicles.
Speaker Change: I feel so hydrogen engine might be applied to motor sports and it's been five years since you apply that AR and then towards the end of the year. If we do 24 hour race. This a hydrogen vehicle.
Kiyadashi: I have a question about the U.S. and China. I have one question to each country, about each country. The first point is the U.S.A. It's a direct question, but earlier you already mentioned that the mid to long term versus the short term, how you prepare yourself to potential tariffs, but in the mid to long term, that you will provide this product to the local customers. It's the best in town, through the local production, if the tariff will stay permanently, that the production capacity locally should be enhanced, or you might have to build a new plant.
Speaker Change: Do you participate at that time.
Speaker Change: Mr. Sato is a prisoner to launch the hydrogen engine for the motor sports. So what's the progress to date of the hydrogen engine. Another question.
Speaker Change: You're talking about is a group of Google strategy, you are supplying just a suitable car to each region on the other hand.
Speaker Change: The enjoyable experience.
Speaker Change: Experience that a wow experience that got that kind of caused that Mr satellites Wow experience to the <unk> com.
Kiyadashi: Is it a possible scenario? That's my first question.
Speaker Change: So it's sort of like about this.
Speaker Change: Lately, we don't really see many new models are developed by us which is suitable for that they'll all experience.
Kiyadashi: The second question is a question about China. I saw that in the material you talked about China, when you compare it to 94.1%, there was a number. But in terms of share, in the last several years, the local companies are getting strong and you are having difficulty. But you will be emphasizing your effort in China to recover your activity. What's the strategy? Taking into account the change of environment, of the competitiveness in the Chinese market. So what's your outlook in China?
Speaker Change: About the Mt. Two pathways strategy, yes, we will maintain that.
Speaker Change: So tissue.
Speaker Change: Yeah.
Speaker Change: Thank you.
Speaker Change: D C will be further advanced and then the hybrid system will become more efficient and then we will continue this technology development. So smaller compact car with a higher efficiency and those are the output to the characteristics should be further enhanced that technology is being promoted so that's a powertrain.
Sato: Thank you for your question. But thank you, Kiara-san, for your question. The first is to meet the long-term outlook, naturally. It's been doing this for some time. In the USA, we have USMCA, which is the local production, the target to increase the local procurement level according to the rule. And then so local production, local supply, and that the local supply percentage ratio should be increased steadily from BCP standpoint. If some incident occurs that the local production is still possible, not just vehicles, but units as well, that the local production, local procurement should be further promoted.
Speaker Change: Evolution, it should be driven and we'd like to continue that effort in that area on the other hand.
Speaker Change: In a way schuh and energy Mike.
Speaker Change: Does it make a difference in terms of where we emphasize the or the pathway toward the equipment on origination. So the energy availability might make a difference I feel especially of hydrogen.
Speaker Change: The major challenge for hydrogen is just hydrogen itself.
Speaker Change: Please go ahead.
Speaker Change: We are picky about its origin and hydrogen becomes such an expensive energy source energy cost is so expensive, it's too expensive to put it otherwise.
Speaker Change: It's a barrier who prefer organization so in order for us to promote that.
Speaker Change: The hydrogen use should be increased first that is an initiative. We first have to take and then O D for the passenger car a reward.
Sato: We've been doing this for some time. But because of that, Even though the tariff is there, it's not effort. We've been doing something we should do, and then we steadily perform our duty. That's something we intend to do. As a result, if things go smoothly, we might accelerate that action. But as I said, everything is not 100% predictable. Within that uncertainty, we should not sway from one way to another, but we will take a steady run and stay in the course, and make a final decision according to this monitoring.
Speaker Change: But 60 times some more.
Speaker Change: Sensitivity for the commercial vehicle one the heavy duty truck versus small passenger car decides to.
Speaker Change: Scale is 64 different so that the real time to make efforts in commercial vehicle as well so that the cost reduction efforts should be made they've finally, the technology of the hydrogen engine could become quite useful.
Speaker Change: N genius combustion.
Speaker Change: <unk> is already in our in house technology, So efficiencies one challenge and another one that does the combustion of the hydrogen.
Sato: As to China, let me respond on China. Our outlook on China, China is not one market, but rather 1.4 billion population in China. We are not in a position to take care of all those people by our business. We are not in that position. So from that standpoint, the local coastal areas, the big cities, the population we like to target, that is where the real focus in terms of the segment of Chinese market. So in that sense, Naturally, there are local manufacturers and suppliers in China. OEMs are very strong in certain provinces or regions. So Chinese markets should be scrutinized in detail by region and region.
Speaker Change: He took issue because the food I C E.
Speaker Change: Combustion efficiency.
Speaker Change: Could be may be enhanced by the beta hydrogen combustion of Biofuels, if you will today or support it.
Speaker Change: In the engine to go to us because we do realize the hundred technology, we have benefit to be enjoyed.
Speaker Change: But that acuity technology, so hydro and he gave us a good starting point, but eventually it will give you saw D S.
Speaker Change: Synergy to really lead us to the multi pathway development. So standalone hydrogen should not be scrutinized, but that's the starting point to lead us to this a synergy or multi pathway. So did you.
Speaker Change: So I think we now are seeing the physical site. So hydrogen is it just a kickoff of course liquid hydrogen is one area of how we work toward and work hard and I Hope you will continue to support us our chairman food that is driving the car itself a hydrogen vehicle and she is a leading figure to a promo.
Sato: So we should avoid the direct competition. But there are certain areas where we can coexist with the Chinese manufacturers. So in that Chinese situation, of course, as the market shares, the units and volume, the targets were achieved thanks to these suppliers and also the dealers there. And so the profitability in China, which we've been telling you, in a Chinese business, our profitability level is highly evaluated compared to the local competitors. Our level is on par with the Chinese competitors. So that's how we evaluate our Chinese business performance. So our strength should be leveraged further in the future.
Speaker Change: The hydrogen society.
Speaker Change: So we.
Speaker Change: Well actually realize the hydrogen society and multiple the simultaneous efforts are needed. So we will never give up to do that and we like to reassert our strong determination.
Speaker Change: The second point.
Speaker Change: Cough, it induces a while with spirit.
Speaker Change: I appreciate your question.
Speaker Change: Yes, I agree to you exciting vehicles isn't necessarily the cost should be enjoyable.
Speaker Change: Otherwise it is not the comp if you just turn into quantity. So we have a determination that the car should never be looked at as commodity so that the function of lives and logical thinking was and then based upon the left side of the brain you cannot sell their products based upon pickup a little the vehicles you just some yearly change doesn't Nomura.
Sato: We announced last month that the development structure will be enhanced in China so that BEV, suitable for Chinese customers, will be launched and the Lexus brand, Toyota brand will be enhanced and protected further.
Speaker Change: I'm going to switch and has a new design onto engine it won't sell anymore. So how passionate you are to produce a call feature on this.
Speaker Change: Triga Dicenso bow Wow.
Operator: Thank you very much.
Of course that of course, you have to the shop fitting to have a PD.
Mizumachi: Now going back to this room, we will take questions from people in this room again. In the middle... person in the second row.
Speaker Change: It's not just a sports car for the ordinary costs as well.
Speaker Change: You have to.
Speaker Change: Is still your passion to appeal to the customer to their heart. So that I think the each project teams should share that says and I'm encouraging all of the projects team members to build such a car.
Speaker Change: Really encouraging and that's the way T M. She should be and that's my passion.
Mizumachi: I'm Mizumachi from Nikon Automobile. I have a question about the Japanese market. Last year there was a certification issue and quality issues leading to long lead time and low production. But if you look at this year... We have some negative numbers. Can you tell us about the background? 3 million production in Japan. In order to maintain that, at least half of that number should be sold in Japan. But over the medium to long term, what is your outlook about the domestic market? Mizumachi-san, is it just one question? About sales in the Japanese market, of course.
Speaker Change: And in the Cisco you, we'd like to work hard to achieve this goal.
So.
Speaker Change: To your question and you are thinking about the model.
Speaker Change: Yes.
Speaker Change: As time is right, we will disclose at the new modal to you, but I cannot disclose the name right now today at the press conference.
Speaker Change: So I've got another occasion or who could be ready to tell you in a nutshell. This a new exciting.
Yamamoto: Thank you very much change to Yamamoto.
Speaker Change: No.
Speaker Change: It is time, so that does conclude the Q&A session I would like to ask the gentleman to stand up.
Speaker Change: Okay.
Speaker Change: Thank you very much.
Speaker Change: Yes.
Speaker Change: Thank you.
Speaker Change: With this we conclude the financial results meeting for.
Mizumachi: We have a model life cycle, so when you go to the peak... There will be a stable period, and then there are some differences in numbers, but basically we are aiming at 1.5 million being sold. There is no strong will or background here. In thinking about the model life cycle, we came up with these numbers. Now, about the medium to long-term outlook... It has always been said that in Japan the population is declining and the birth rate is declining but how to reduce the vehicle replacement cycle is something that we want to work on to revitalize the Japanese market.
Speaker Change: Fiscal 2025, so thank you very much for watching game coming.
Yoichi Miyazaki: Attractive cars will have to be launched and in order to make the replacement cycle shorter we have to work more to sell them in a better way. So including Kinto and other initiatives we will continue to try new efforts. Let me add something. Thank you very much for your question.
Sato: Your question was about the future of the Japanese market. As Mr. Miyazaki mentioned, how can we produce and deliver cars that people would want to buy? If the vehicles are produced based on traditional thinking... We just launched a new Crown series, but 10 years ago, the Crown was an FR sedan, an authentic product, that was the stereotype image of the model Crown, but but What is the significance of Crown being a long seller? That is something that we reviewed anew to come up with a new product. So, rather than looking at the old framework, what is necessary now in this market is something that we have to face.
Sato: We are a car maker, so we need to produce cars that people would want to purchase in Japan. We have to come up with ideas to launch those products. We need to solidify the foundation, come up with extra capacity so that we can produce cars that are suitable for the local market. Thank you very much to Mr. Mizumachi.
Yamamoto: Time is running short, so we'd like to entertain just one last question, if we may. There's a person in the front section. Yamamoto, a freelance journalist. Earlier in the presentation, he talked about the multi-pathway strategy, which will be unchanged. But hybrid is a strong area. It's doing quite well. On the other hand, the practical value at the PHB is not really growing, as you expect. It's a hydrogen vehicle. So far you are trying to boost the spirit, but maybe there's a toning down about the hydrogen vehicles. I feel so. Hydrogen engine might be applied to motor sports and it's been five years since you applied that.
Yamamoto: And then toward the end of the year, the Fuji 24-hour race that this hydrogen vehicle is to participate. At that time, Mr. Sato was the president to launch the hydrogen engine for the motor sports.
Yamamoto: So what's the progress state of the hydrogen engine?
Yamamoto: Another question, earlier you told about this group strategy, you supply this suitable car to each region on the other hand. The enjoyable, the experience, like the wow experience, like that kind of car that Mr. Sato likes, wow experience to be given by a car. So it's sort of like, but definitely lately, we don't really see many new models that are developed by you, which is suitable for that WOW experience. Well, about the multi-pathway strategy, yes, we will maintain that strategy. The ICE will be further advanced, and then the hybrid system will become more efficient. And then we will continue this technology development, so smaller, compact car with a higher efficiency, and also the output, the characteristics should be further enhanced.
Yamamoto: That technology development is being promoted, so that's a powertrain evolution which should be driven, and we'd like to continue that effort in that area. On the other hand... In a way, fuel and energy might make a difference in terms of where we emphasize or the pathway toward the popularization. So the energy availability might make a difference, I feel, especially hydrogen. The major challenge for hydrogen is that hydrogen itself... We are so picky about its origin. And hydrogen becomes such an expensive energy source. Energy cost is so expensive. It's too expensive to popularize. It's a barrier for popularization.
Yamamoto: So in order for us to promote that, the hydrogen use should be increased first. That is an initiative we first have to take. And then for the passenger car, we will do our part. But 60 times more sensitivity for the commercial vehicle. One, the heavy duty truck versus small passenger car, the size or the scale is 60-fold difference. So that we are trying to make efforts in commercial vehicle as well, so that cost reduction efforts should be made. Then finally, the technology of the hydrogen engine could become quite useful. Because hydrogen engine is combustion to control.
Yamamoto: It's already in-house technology. So efficiency is one challenge. And another one, the combustion of the hydrogen is an issue. Because for the ICE, the combustion efficiency could be maybe enhanced by the better hydrogen combustion. Biofuel, e-fuel, if they are supplied. In the engine technology, because we develop the hydrogen technology, we have benefit to be enjoyed. by the accumulated technology. So hydrogen gave us a clue, starting point, but eventually it will give us the synergy to really lead us to the multi-pathway development. So standard of hydrogen should not be just scrutinized, but that's the starting point to lead us to this synergy of multi-pathway strategy.
Yamamoto: So I think we now are seeing the visible sign, so hydrogen is just a kick-off. Of course, liquid hydrogen is one area where we will work toward and work harder, and I hope you continue to support us. Our chairman, Toyoda, is driving the car itself, a hydrogen vehicle, and he's a leading figure to promote the hydrogen society. We would like to realize the hydrogen society and multiple simultaneous efforts are needed. So we will never give up to do that, and we would like to reaffirm our strong determination.
Yamamoto: The second point, the car, which induces a wow spirit, I appreciate your question. Yes, I agree to you. An exciting vehicle is necessary. The car should be enjoyable. Otherwise, the car is not a car. It will just turn into a commodity. So we have a determination that the car should never be looked at as a commodity. So that the function-wise and logical thinking-wise and based upon the left side of the brain, you cannot sell this product based upon the catalog of the vehicle. Of course, you have to have a sharp feeling to have an appealing car.
Yamamoto: It's not just a sports car. For the ordinary cars as well, you have to instill your passion to appeal to the customer, to their heart. So that I think each project team should share that sense. And I'm encouraging all the project team members to build such a car. And we are really encouraging. And that's the way TMC should be. And that's my passion. And in this fiscal year, we'd like to work hard to achieve this goal.
Yamamoto: So, to your question, and you are thinking about the model? As time is ripe, we will disclose the new model to you. I cannot disclose the name right now today at the press conference. So, at another occasion, we hope we could be ready to tell you and announce you this new exciting Thank you very much to Mr. Yamamoto.
Operator: It is time, so let us conclude the Q&A session, so I would like to ask the three gentlemen to stand up. Thank you very much. Thank you.
Operator: With this, we conclude the financial results meeting for Fiscal 2025. Thank you very much for watching and coming.