TOKYO -- Japan’s earnings season wrapped up this week on what would have been a sour note in any other auto market.
Bracing for lower sales at home and in emerging markets, five of Japan’s top six carmakers cut their sales forecasts for the current fiscal year. Only Toyota kept its outlook unchanged.
Yet, Japan’s automakers largely laughed it off. Why? Because of the tumbling yen.
Despite the lowered expectations, Nissan Motor Co. and Subaru-maker Fuji Heavy Industries actually raised their forecasts for operating profit and net income. So did Toyota Motor Corp.
Even lower-tier players such as Mitsubishi Motors Corp. and Mazda Motor Corp. kept their profit goals cemented in place, despite likewise scaling back their sales plans.
Honda Motor Co., which also cut its global sales goal by 3.7 percent, or 170,000 vehicles, was the lone outlier in revising down its projections for operating profit and net income.
But then again, Honda also plans to book a massive one-time cost to cover its millions of Takata airbag recalls.
The weaker yen coats the Japanese balance sheet in teflon.
By Dec. 31, the last day of Japan’s fiscal third quarter, the Japanese currency had plunged 14 percent against the dollar, from a year earlier. And carmakers expect it to keep falling.
Nissan, for example, upped its operating profit forecast by 6.5 percent and its net income goal by 3.7 percent after changing its exchange rate assumption for a much weaker yen. And that’s despite cutting its sales forecast by 2.8 percent.
For Subaru, which sells 60 percent of its global volume in the United States, the stakes are even higher. It is now shooting for new records in revenue, operating profit and net income.
It trimmed its unit sales target too -- to 906,1000 vehicles from 909,400. But even that still represents an all-time high.
And Toyota arguably makes out the best.
Citing a faster-than-expected falling Japanese currency, the world’s biggest automaker raised its profit and revenue forecasts to new records, for the second time this fiscal year.
Oh, what a feeling, to be surfing that slumping yen.