Associated Press
Saturday, August 4, 2007

TOKYO, Aug. 3 -- Booming sales of fuel-efficient cars helped lift Toyota to its biggest quarterly profit ever and kept the maker of the Prius hybrid on a pace to pass General Motors as the world's No. 1 automaker this year.

Despite concerns in the industry about sluggish auto sales in the United States and Japan, Toyota got help from a weak yen and cost cuts in its first fiscal quarter. Japan's biggest automaker posted a 32.3 percent increase in profit, to $4.1 billion, for the quarter ended June 30.

[In Detroit, private-equity firm Cerberus Capital Management took control of Chrysler Group on Friday in a $7.4 billion deal. DaimlerChrysler of Germany, which also builds Mercedes-Benz luxury cars, agreed in May to transfer an 80.1 percent stake in Chrysler to Cerberus. Daimler kept a 19.9 percent interest.]

[Chrysler LLC, as the new company will be called, said it would run a "New Chrysler" ad campaign through this year. The company plans to unveil its new logo, an updated version of its five-sided star, on Monday.]

High gasoline prices have helped Toyota as drivers flock to its fuel-efficient models, including the Camry, the best-selling model in the United States, and the Prius gas-electric hybrid.

Even in North America, a tough market recently, Toyota sold 762,000 vehicles in April, May and June, an increase of 15,000 from the comparable period a year earlier. Sales were helped by the introduction of the Tundra truck and Lexus LS.

"The results are fantastic," said Tsuyoshi Mochimaru, auto analyst with Lehman Brothers in Japan. Overseas sales are strong, and the weak yen, which raises the value of overseas earnings, is improving earnings as Toyota's exports grow, Mochimaru said.

Quarterly sales rose 15.7 percent, to $54.7 billion. At current exchange rates, that's more than General Motors' record quarterly sales of $54.5 billion set in the second quarter of 2006.

But Toyota kept what some analysts called a conservative forecast for the full fiscal year through March 2008, projecting profit to rise just 0.4 percent, to $13.85 billion on sales of $209.78 billion.

It also maintained its vehicle sales target for the full fiscal year at 8.89 million.

"We posted substantial increases in both revenue and profit, our highest-ever quarterly results," said Takeshi Suzuki, Toyota senior managing director.

Toyota surpassed GM in global vehicle sales for the first half of the calendar year, 4.72 million to 4.67 million. Many analysts expect Toyota to beat GM for the full year in both sales and production.

The title of world's biggest automaker, which GM has held for 76 years, typically is determined by worldwide vehicle production numbers. For the first six months of the year, Toyota built 4.71 million vehicles worldwide, while GM estimates that it made 4.75 million vehicles.