In the luxury automotive sector, Bentley issued a warning last week that it may no longer experience the same level of success it had in the post-Covid era. The company stated that it is unlikely to repeat last year’s record-breaking earnings due to a decline in orders during the first half of the year. Deliveries dropped by 4% to 7,096 units.
On the other hand, Toyota reported a significant surge in sales during the first three months of its fiscal year, with a rise of almost a quarter. This increase was driven by strong demand, allowing the company to raise prices and achieve an operating profit of 1.1 trillion yen (£6 trillion) for the period. As a result, Toyota’s shares reached a record high, valuing the company at 39.9 trillion yen.
Analysts at Bloomberg anticipate a nearly 20% increase in Japanese car sales in both Japan and the US. However, China poses a challenge as foreign carmakers face competition from domestic players and struggle to maintain their market share.
Despite being one of the slowest adopters of pure electric power for cars, Toyota is now targeting the highly competitive Chinese electric car market. The company is partnering with suppliers Denso and Aisin to expedite the development of new parts for electric models and advanced interiors that cater to the demands of Chinese buyers. This marks a significant ramp-up in Toyota’s electrification efforts, without abandoning its other technologies.
Meanwhile, one of the largest electric car leasing companies in the UK is up for sale as investor Legal & General has declined to provide additional funding. Sky News reported that Onto will either be sold or seek alternative financing options. Leasing electric cars has become a tax-efficient method of driving these vehicles, especially through long-term hire schemes such as salary sacrifice initiatives.
Legal & General injected millions of pounds of financing in May and June, but decided to halt further liquidity support last month. The volatile pricing of electric cars has negatively impacted some lenders, as the price war initiated by Tesla has spread to other carmakers, reducing the value of their vehicle inventory. Rising interest rates have also squeezed margins for large fleet owners, and the nascent second-hand electric car market has led to price depreciation for certain models. L&G declined to comment on the matter.
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