Toyota Motor Corp. (7203.TO) President Akio Toyoda said the automaker will maintain domestic vehicle production level at 3 million unit per year despite the negative impact of the strong yen.
“The current exchange rate is very severe for manufacturers like us,” Mr. Toyoda said in response to shareholder queries about the company’s competitiveness.
“[But] the Japanese auto industry won’t give up on Japan-based manufacturing and will appeal to the government for help in defending this last bastion,” of the country’s industrial base, he said.
A couple of shareholders expressed worries about the ability of Toyota to keep its promise to preserve production of 3 million vehicles in Japan.
“Can you really sell 3 million cars in Japan?” demanded a shareholder who identified himself only by his surname Suzuki.
Toyota executive Atsushi Niimi said Toyota plans to sell half of that in Japan and export the rest.
Officials acknowledged that it would be better to sell more in Japan because of the strong yen that puts Toyota at a disadvantage in the U.S. and other markets against Volkswagen and Hyundai.
In 2011, Toyota sold 1.2 million units in Japan with a market share of 44.4 percent.
Toyota’s domestic market share peaked at 48.5 percent in 2010, when the company sold around 1.56 million units in Japan on the back of the government’s subsidy program and tax breaks for environmentally friendly vehicles.
Vehicle demand in Japan in 2011 totaled 4.2 million vehicles, down 15 percent from the previous year, but is expected to grow 19 percent to 5 million vehicles this year, according to the Japan Automobile Manufacturers Association (JAMA).