Toyota Hits Global Production High With 11.52M Vehicles In 2023, Yet Daihatsu And Hino Motors Raise Red Flags
Portfolio Pulse from Nabaparna Bhattacharya
Toyota Motor Corporation (NYSE:TM) achieved a record global production of 11.52 million vehicles in 2023, an 8.6% increase from the previous year. Production in Japan rose by 18%, while production outside Japan increased by 3.6%. Total sales for the year were 11.2 million vehicles, a 7.2% year-over-year increase. Despite these positive results, governance issues at Toyota's Daihatsu and Hino Motors units have raised concerns, particularly regarding certification tests for cars and engines. Toyota Chairman Akio Toyoda has apologized for these irregularities. Additionally, Toyota has advised against driving certain vehicles in the U.S. due to the ongoing Takata airbag recalls. TM shares dropped slightly by 0.38% in premarket trading.
January 30, 2024 | 1:59 pm
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NEGATIVE IMPACT
Toyota's record production and sales figures indicate strong performance, but governance issues at Daihatsu and Hino Motors, along with the Takata airbag recall, could negatively impact the brand's reputation and investor sentiment.
The record production and sales figures are positive indicators of Toyota's performance and could lead to a favorable short-term impact on TM's stock price. However, the negative news regarding governance issues and the Takata airbag recall could overshadow these achievements and lead to a decrease in investor confidence, as evidenced by the slight premarket dip in TM shares. The impact is scored as negative due to the potential reputational damage and the immediate nature of the recall advisory.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 90