Speaking to Bloomberg, Kenichi Noda, executive managing officer at Toyota Boshoku, an affiliate of Toyota that makes interior parts and bumpers, said that the carmaker had won a number of price reductions over the past few years due to the strengthening of the yen, but this was unlikely to continue following its recent decline.
This claim was backed up in a recent report by two Credit Suisse auto analysts, who said that “with the yen now in decline, Toyota no longer has any real cause to sustain that pressure” on suppliers.
But a spokesman for Toyota said “analysts’ views are based on their own take of the situation, not decisions announced by Toyota”, and refused to discuss with Bloomberg talks that it is having with suppliers.
On 4 February, the yen fell to 93.18, its lowest level since May 2010 and some way below the 85.11 it averaged between November and February last year. A one yen decline in the exchange rate can add around $377m to Toyota’s operating profit.
Other Japanese auto manufacturers, including Nissan and Honda, shifted production overseas in order to try and avoid the worst effects of a strengthening yen, but it is unclear whether they may look to bring any production back.
