Japanese carmaker Toyota is facing a period of turmoil in its main international markets. The group's global sales fell for the sixth consecutive month in July, amid rising fuel prices — which have dampened demand for internal combustion engine cars — and geopolitical and competitive pressures in China and the Middle East. However, Western markets' growing appetite for hybrid powertrains and a weaker yen are keeping the automaker's financial outlook at a record high.
The Japanese automaker's global sales, which include the results of its subsidiary Daihatsu Motor, fell 5.3% in July compared to the same period last year, reaching 912,683 vehicles. At the same time, the brand's global production decreased by 1.4%, with 934,953 vehicles assembled.
The main factor behind this slowdown is the increase in fuel prices, a situation that directly affected consumers' purchasing decisions in the segment of vehicles equipped exclusively with internal combustion engines.
Toyota's global performance reflects a sharp differentiation between regions:
● China: Combined sales of Toyota and Lexus brands fell 24% in July compared to July last year. The Japanese manufacturer is losing ground to local manufacturers, which are rapidly launching cheap and highly advanced electric vehicles in terms of software systems.
● Middle East: Deliveries fell by almost 45%. Toyota exports between 500,000 and 600,000 cars to this region annually, but the company had warned in May that about half of this volume would be negatively affected by the escalation of regional conflicts and logistical disruptions.
● North America: Sales remained stable.
● Japan and Europe: They recorded sustainable increases in deliveries, supported almost entirely by a strong return to interest in gasoline-electric hybrid vehicles.
Despite the volume declines, the company's financial health remains extremely robust. Toyota raised its profit forecast for the fiscal year ending March 2027 to 3.4 trillion yen (about $23 billion).
This revision represents a significant change in direction from the initial forecast, which anticipated an unusual decline in profitability due to the explosion in raw material costs generated by geopolitical tensions. The positive reorientation is based on two pillars:
1. Massive demand for hybrids in the US, where buyers are hesitant about 100% electric cars due to infrastructure.
2. Exchange rate developments, with the weakness of the yen providing a major advantage in repatriating income earned in dollars.
Globally, Toyota is on track to surpass 5 million hybrid vehicles sold in a single calendar year for the first time in history, confirming its long-term strategy of gradually transitioning to mixed electrification technologies.
While markets like China penalize the lack of purely electric models in the Japanese portfolio, the situation in Romania offers a diametrically opposite picture, transforming our country into one of the brand's successful European bastions.
Toyota firmly holds the position of the best-selling imported car brand in Romania, being surpassed overall only by the national manufacturer Dacia. The Japanese manufacturer holds a market share of over 9% of total new car registrations, consistently delivering between 15,000 and 16,000 units per year.
Local success factors:
● Dominance of the Full-Hybrid segment: In Romania, models such as the Toyota Corolla, Yaris Cross and C-HR dominate the sales charts of plug-in hybrid cars. The Corolla model has been the best-selling hybrid car in the country for years.
● The optimal alternative to the increase in fuel prices: In the context of the increase in the price of gasoline and diesel, customers in Romania – both individuals and companies with large fleets – have massively migrated to Toyota's self-charging systems, due to the very low consumption in urban environments.
● Evolution of the Rabla program and reluctance towards electric vehicles: Given that the national network of charging stations is still under development, and the funds for the Rabla Plus Program (intended for 100% electric cars) have undergone changes, Romanians prefer the safety offered by a classic hybrid.
● Resale value and reliability: The perception of long-term reliability and high value on the second-hand market keep demand high, both for new unit purchases and in the fleet management segment.