Toyota Motor Corp is forecast to report its third consecutive quarterly operating profit drop when it releases results on Friday. Analysts surveyed by Refinitiv anticipate operating profit of approximately ¥1.1 trillion, down roughly 8 percent from the same quarter a year earlier. The decline is attributed to higher raw-material and logistics costs, coupled with U.S. import tariffs on a broader range of vehicles. This comes despite record global vehicle sales of 2.95 million units during the period, driven by robust demand for the Corolla Cross and RAV4 models. Toyota’s luxury division, Lexus, also posted its highest quarterly deliveries on record, but margin pressure in North America and Europe is expected to weigh heavily on overall earnings.

Toyota plans to boost annual hybrid and plug-in hybrid vehicle output to 6.7 million units by 2028, a 30 percent increase over its 2026 target, according to the Nikkei business daily. The expansion will be supported by investments totaling ¥1 trillion in new battery production lines and expanded assembly capacity at its Takaoka and Kyushu plants. Toyota aims to introduce two new solid-state battery prototypes by 2027 and achieve per-unit battery cost reductions of 20 percent compared with current lithium-ion technology. The company expects hybrids to account for nearly 40 percent of its global sales mix by 2028, up from roughly 30 percent in 2025.