TOKYO - For Japan's auto industry, the fiscal year that ended March 31 was one to celebrate.
The industry enjoyed the highest domestic sales in five years. Exports rose, too, while a weak yen yielded more currency profit from every dollar or German mark received for Japan-built cars and trucks sold abroad.
Home-market sales rose 5.4 percent from a year earlier, to 7,287,961 units, and exports jumped 6.2 percent, to 3,847,865, the first gain in five years.
'I can safely say nothing went wrong last year,' said Shigeki Hayashi of Honda Motor Co.'s Finance Division.
BOOM YEAR FOR HONDA
That was easy for him to say: Honda's net income tripled from a year earlier, to a record $1.8 billion, on record unit sales and revenue. The company also reaped the benefits of a rich model mix in the home market, including such hot models as the StepWGN and S-MX minivans.
Toyota Motor Corp.'s profit rose 68 percent on a pretax basis and 50 percent at the bottom line. Neither were records, but they brought Toyota back to levels last seen during the years of Japan's so-called bubble economy in the late 1980s.
The figures were not as good at Mazda Motor Corp., which had lost money the prior three years.
With Mazda's exports up in both unit and value terms, the yen/dollar exchange rate kicked in about $201.6 million to the parent company's operating profit.
Mazda, however, fields an almost all-sedan lineup in Japan, where buyers increasingly are looking for minivans, sport-utilities and station wagons. The company's home-market sales slipped 8.3 percent in yen terms, erasing four-fifths of the currency gains.
On an operating basis, Mazda remained slightly in the red. The company again sold securities to bring its pretax and net results into the black.
'It's just critical that we become profitable on an operating basis,' said Gary Hexter, senior managing director in charge of corporate planning and cost planning. 'We are on track to do so in the first half. That would be a considerable breakthrough for Mazda.'
Honda's record profits pushed its gross return on sales to 4.2 percent, and Toyota's margin rose to 3.2 percent, the highest since its fiscal year that ended in June 1991.
In comparison, Chrysler Corp.'s 3.2 percent return on sales topped the U.S. Big 3 in 1996.
MAKERS TARGET COSTS
Still, the Japanese makers did not spend the year leaning back and letting the money flow in. Cost-cutting remained a mantra for all.
Indeed, cost-cutting contributed more than the weak yen to operating results at Mazda, Daihatsu Motor Co. and Fuji Heavy Industries Ltd., maker of Subaru cars.
Looking to the current fiscal year, Toyota, Honda and Mazda all predicted further profit increases. However, Honda and Mazda base their forecasts on an exchange rate of 115 yen to the dollar for the full fiscal year, even though the dollar traded below that most of last week.
Toyota assumes an average rate of 112 yen for the current year.