Toyota Motor Corp. Annual Report 2013

FY2013 Annual Report · Toyota Motor Corp.
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Annual Report 2013

Year ended March 31, 2013

True Competitiveness for Sustainable Growth

Unveiled in March 2011, the Toyota Global Vision is an articulation of the kind of company 

we want to be. It clariﬁ es our values; we want to be a company that people choose and to bring a smile to 

the face of every Toyota customer. Supported by a virtuous cycle that entails making ever-better cars, 

enriching communities, and ensuring a stable base of business, we will continue to pursue 

sustainable growth through our Global Vision.

ANNUAL REPORT 2013

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Contents

P a g e  03

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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Next

04  President’s Message

07  

Special Feature I  
Making Ever-Better Cars

17

Special Feature II  
Enriching Lives of Communities

20

Special Feature III  
Stable Base of Business

“Rewarded with a smile by exceeding your expectations,” 

The global ﬁ nancial crisis that began in 2008 reminded us once 

More than just providing transportation, the cars of the future will 

First and foremost, we strive to make ever-better cars and 

all 330,000 of us at Toyota around the world work together as 

again that the foundation of sustainable growth is making cars 

use information technology to serve a variety of functions that 

enrich communities in order to achieve sustainable growth and 

one to make ever-better cars and to contribute to society.

that customers love. We changed direction, recommitting all of 

beneﬁ t both people and society as a whole. This vision under-

a stable business foundation. This ever-growing stable busi-

our resources to making even better cars, and over the course 

pins Toyota’s commitment to enriching lives of communities. 

ness foundation, in turn, provides us with the strength to make 

of the following four years we signiﬁ cantly improved our manu-

Toyota is broadening its horizons as it seeks to improve day-to-

ever-better cars and enrich society. It is a virtuous circle.

facturing methods.

day life and to bring smiles to the faces of future generations.

05  Launching a New Structure to 

Help Fulﬁ ll the Toyota Global 
Vision

21  

Message from the Executive 
Vice President Responsible for 
Accounting

23  What Sets Toyota Apart

Cautionary Statement with Respect to Forward-Looking Statements
This document contains forward-looking statements that reﬂ ect Toyota’s plans and 
expectations. These forward-looking statements are not guarantees of future perfor-
mance and involve known and unknown risks, uncertainties and other factors that 
may cause Toyota’s actual results, performance, achievements or ﬁ nancial position 
to be materially different from any future results, performance, achievements or ﬁ nan-
cial position expressed or implied by these forward-looking statements. These 
factors include, but are not limited to:
(i) changes in economic conditions and market demand affecting, and the competi-
tive environment in, the automotive markets in Japan, North America, Europe, Asia 
and other markets in which Toyota operates; 

24   Consolidated Performance Highlights

27   Review of Operations
27  Automotive Operations
28  Financial Services Operations
29  Non-Automotive Business Operations

32   Management and Corporate Information

32  R&D and Intellectual Property
34  Corporate Philosophy
35  Corporate Governance

37  Management Team
39  Risk Factors

42   Financial Section

122   Management’s Annual Report on Internal 

Control over Financial Reporting

123   Report of Independent Registered Public 

Accounting Firm

42  Selected Financial Summary (U.S. GAAP)
44  Consolidated Segment Information
45  Consolidated Quarterly Financial Summary
46   Management’s Discussion and Analysis of 

124  Investor Information

“Toyota Global Vision” on the Front-lines

Financial Condition and Results of Operations 

The following special feature outlines how the Company engages in 

72  Consolidated Financial Statements
78  Notes to Consolidated Financial Statements

visionary management in the words of front-line personnel.

Please read from the Special Feature page or turn to the following if 
accessing from the Special Content top page.

(ii) ﬂ uctuations in currency exchange rates, particularly with respect to the value of 
the Japanese yen, the U.S. dollar, the euro, the Australian dollar, the Russian ruble, 
the Canadian dollar and the British pound, and interest rates ﬂ uctuations; 
(iii) changes in funding environment in ﬁ nancial markets and increased competition in 
the ﬁ nancial services industry; 
(iv) Toyota’s ability to market and distribute effectively; 
(v) Toyota’s ability to realize production efﬁ ciencies and to implement capital expendi-
tures at the levels and times planned by management; 
(vi) changes in the laws, regulations and government policies in the markets in which 
Toyota operates that affect Toyota’s automotive operations, particularly laws, regulations 

and government policies relating to vehicle safety including remedial measures such 
as recalls, trade, environmental protection, vehicle emissions and vehicle fuel econ-
omy, as well as changes in laws, regulations and government policies that affect 
Toyota’s other operations, including the outcome of current and future litigation and 
other legal proceedings, government proceedings and investigations; 
(vii) political and economic instability in the markets in which Toyota operates; 
(viii) Toyota’s ability to timely develop and achieve market acceptance of new prod-
ucts that meet customer demand; 
(ix) any damage to Toyota’s brand image; 
(x) Toyota’s reliance on various suppliers for the provision of supplies; 

(xi) increases in prices of raw materials; 
(xii) Toyota’s reliance on various digital and information technologies;
(xiii) fuel shortages or interruptions in electricity, transportation systems, labor strikes, 
work stoppages or other interruptions to, or difﬁ culties in, the employment of labor in 
the major markets where Toyota purchases materials, components and supplies for 
the production of its products or where its products are produced, distributed or 
sold; and
(xiv) the impact of natural calamities including the negative effect on Toyota’s vehicle 
production and sales.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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Contents

P a g e  04

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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  The last four years have also been an opportunity to reconnect with our roots and return to the things that we 

have always held dear. Toyota’s roots lie in its founding principle of contributing to society by making automo-

biles. Put simply, our goal should ever be to make ever-better cars. 

  The products that are only just beginning to roll off the lines represent the ﬁ rst results of our groupwide 

 emphasis on making ever-better cars. At the same time, we are making steady progress in reforming production 

technology and making new cars based on the Toyota New Global Architecture (TNGA). 

  Looking at the consolidated results for the ﬁ scal year ended March 31, 2013, Toyota recorded substantial 

improvements in both revenue and earnings. This upturn was largely attributable to the increase in vehicle 

sales in North America and Asia and concerted efforts by the entire Toyota Group to boost proﬁ ts. On a non-

consolidated basis, Toyota was successful in turning a proﬁ t for the ﬁ rst time in ﬁ ve years. This achievement is 

entirely attributable to the backing provided by the global Toyota team, which encompasses a wide range of 

stakeholders such as employees, sales outlets, suppliers, and, of course, customers. I am deeply grateful for 

their conﬁ dence and support.

  There is a growing sense that the business model set forth in the Toyota Global Vision is steadily becoming more 

robust. It is important, however, to remember that we have merely reached the next starting line and that every 

member of the Toyota Group needs to focus on ensuring true competitiveness—competitiveness that will support 

sustainable growth regardless of external factors. Ultimately, true competitiveness cannot be measured simply in 

terms of proﬁ t and loss, but rather represents a challenge that must be met on a groupwide basis. Our efforts to 

meet this challenge are exempliﬁ ed by our adoption of TNGA and the reorganization of our business units. 

  Toyota celebrated its 75th anniversary in November 2012. In establishing the Company all those years ago, 

Kiichiro Toyoda envisioned a strong Japanese auto industry with its roots in Japanese manufacturing traditions. 

Today, we are entering the ﬁ nal quarter of the auto industry’s ﬁ rst century. Over the next 25 years, we must set 

our gaze even further, and gain some insight into this industry’s second century. We must then use this insight to 

inform our own long-term business structure. We must always bear in mind that the sustainable growth we are 

striving to achieve will create a better society for our children and grandchildren.

True Competitiveness for 
Sustainable Growth

Firstly, I would like to express my sincere gratitude for your continued support and understanding.

  “Rewarded with a smile by exceeding your expectations,” all 330,000 of us at Toyota around the world work 

  Since 2009, Toyota has faced a series of prolonged crises. Looking back, these crises allowed us to gain invalu-

together as one to make ever-better cars and to contribute to society. We kindly request the continued support 

able experience and taught us many truths that would have remained hidden if conditions had been more settled.

and understanding of all our stakeholders.

  Particularly during the global ﬁ nancial crisis, when we fell into the red, we learned that a traditionally broad-

based auto industry, while positioned to enjoy the fruits of rapid growth, may also be vulnerable to abrupt decline 

July 2013

that could bring anxiety to a substantial number of people. We are now more attuned to the importance of 

sustainable growth and have learned the critical lesson that an increase in production does not necessarily 

equate to growth. 

Akio Toyoda

President

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Contents

P a g e  05

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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 [1 of 2]

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Launching a New Structure to Help Fulﬁ ll the Toyota Global Vision

In April 2013, Toyota optimized its organizational structure in an effort to better fulﬁ ll the Toyota Global Vision by manufacturing ever-better 

cars. Together with the four newly established units encompassing our automotive operations, the TNGA Planning Division will be respon-

sible for driving medium- to long-term technology-based product strategies under TNGA, while the Product and Business Planning Division 

will focus on generating market-based product and business strategies.

New Structure

IT & ITS

External Affairs & Public Affairs

Administration & HR

Accounting

Purchasing

Customer First Promotion

Technical Administration

R&D

Production Control

Vehicle Production Engineering & Manufacturing

Chairman/President

TNGA Planning Division

Product & Business 
Planning Division

Lexus
International

Toyota
No. 1

Toyota
No. 2

Unit
Center

North America, 
Europe, Japan

China; Asia & the Middle 
East; East Asia & Oceania; 
Africa; 
Latin America & 
the Caribbean

Development, planning, 
and production of engines 
& other unit components

(planning to 
production/sales)

(planning to 
production/sales)

Clarifying responsibility for operations and 
earnings while accelerating decision making

Toyota has split its automotive business into four units 

comprising Lexus International, which covers our Lexus 

brand; Toyota No. 1, which oversees operations in North 

America, Europe, and Japan; Toyota No. 2, which is 

responsible for business in China, Asia & the Middle East, 

East Asia & Oceania, Africa, and Latin America & the 

Caribbean; and the Unit Center, which covers all unit-

related operations. This more agile and autonomous 

management structure will enable us to clarify responsibil-

ity for operations and earnings, and will allow managers in 

the ﬁ eld to make decisions more quickly based on genchi 

genbutsu (on-site, hands-on experience). Recognizing that 

innovation is required in order to establish Lexus as a 

Japanese global luxury brand, the president has taken the 

reins of the newly formed Lexus International unit.

President Toyoda and six executive vice presidents 
(from left: Ihara, Kato, Ozawa, Kodaira, Maekawa, Sudo)

ANNUAL REPORT 2013

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P a g e  06

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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Launching a New Structure to Help Fulﬁ ll the Toyota Global Vision

Ensuring that each unit pursues the most 
appropriate business model

Under the new management structure, each business 

unit will optimize its own business model and aim for 

steady improvement, an approach that is expected to 

contribute to across-the-board growth. Toyota has thus 

Transforming the way we work

Powertrain Development and 
Production Engineering Building

(cid:2) Uniﬁ ed development ofﬁ ce

(1)  Stronger collaboration between engineering 

put in place a structure that is capable of continuously 

and production

Prototype and production 
technique development 
Performance evaluation area
2 Expeditious prototype 
  creation and evaluation

Prototype 
creation and 
production
development

Standalone evaluation

Performance evaluation

(cid:2) Comprehensive evaluation under one roof

(2) Expeditious prototype creation and evaluation

(3)  Single item and product evaluation on a vehicle 

and component basis

Unified development 
office
1 Strengthen collaboration 
  and engineering
  and production

Product development

making ever-better cars and maintaining outstanding qual-

ity and proﬁ tability while further expanding vehicle sales.

In addition to the ongoing development of the Lexus 

business as a in-house company, the Toyota business 

has been split into two business units and executive vice 

presidents appointed to assume responsibility for opera-

tions and earnings. Just as the Lexus business has its 

own business model, the Toyota brand maintains two 

clearly distinct models covering operations in developed 

and emerging markets. For the developed markets in 

(cid:3) Optimum development efﬁ ciency
(cid:3)  Challenge of developing 

which Toyota No. 1 operates, success rests on our ability 

new technologies

to capture replacement demand amid a market that is 

projected to remain stagnant in terms of scale. With this in 

mind, every effort will be channeled toward securing quali-

Vehicle and component 
evaluation area
3 Single item and product 
  evaluation on a vehicle 
  and component basis

Component evaluation

Power package evaluation

Power package evaluation 
on a vehicle basis

(Dimensions: 108m x 89m x 58m; total floor space: 101,228m2)

12F

11F

10F

9F

8F

7F

6F

5F

4F

3F

2F

1F

Powertrain Development and Production Engineering Building

tative growth by expanding sales of ever-better cars that 

regard to annual vehicle sales, goals have been set for 

business and management, it is possible that compo-

engage in face-to-face discussions with the staff respon-

incorporate advanced technologies in such ﬁ elds as the 

the Lexus, Toyota No. 1, and Toyota No. 2 units at 

nents will play an even more signiﬁ cant role. Looking 

sible for production technologies and the development of 

environment and safety. Meanwhile, the emerging 

approximately 500,000 units, 4,000,000 units, and 

ahead, it is quite possible that the fate of manufacturing 

production methods. The second is to create a system 

markets in which Toyota No. 2 operates are experiencing 

3,000,000 units, respectively.

companies will depend more on the competitiveness of 

that can evaluate all stages of development, from funda-

rapid growth. In these markets it is essential to capture 

  With the aim of bringing products to market in 

their components than that of their ﬁ nished products.

mental technologies to ﬁ nished vehicles and compo-

new customers by introducing well-timed products that 

a responsive and timely manner, the Unit Center has 

In keeping with the above, Toyota has constructed 

nents, under one roof.

ﬁ t market needs. Essentially, both Toyota No. 1 and Toyota 

been charged with developing globally competitive “unit” 

a new facility to facilitate the development of powertrains, 

  To ensure that Toyota maintains a genuine competitive 

No. 2 must work to understand the particular stage of 

components, and its purview encompasses all opera-

which are expected to play an increasingly central role in 

advantage, we will position TNGA at the heart of our 

development of their respective markets, and must 

tions from components planning to the development of 

the manufacture of ever-better cars. The facility, which 

endeavors as we engage in a comprehensive review of 

expand these markets by introducing ever-better cars. 

production technologies and functions. To secure the 

went online in February 2013, will enable us to produce 

the way we work. By making decisions in a timely 

They will also need to harness their accumulated know-

comprehensive structure these operations entail, all 

ever-better powertrains, and will play a vital role in trans-

manner and optimizing our business development strate-

how to address the concerns that come with expansion.

related component departments, including factories, 

forming the way we work and supporting the future of 

gies to suit markets, we will strive to make ever-better 

  Adopting a horizontal structure, regional headquarters 

have been consolidated under the Unit Center with an 

the company. 

cars that meet local needs the world over. The overarch-

have been established within Toyota No. 1 and Toyota 

executive vice president appointed to oversee operations 

In overall terms, there two overarching goals for transform-

ing goal of the Toyota Global Vision is achieving sustain-

No. 2 to ensure that the unique markets of each region 

as head of the Unit Center. While Toyota’s principal prod-

ing the way we work. The ﬁ rst is to create an environment in 

able growth, and this will remain our focus as we look to 

are handled in an attentive and appropriate manner. With 

ucts, its cars, are universally recognized as central to its 

which powertrain research and development staff can 

the future.

 
 
 
 
 
 
 
ANNUAL REPORT 2013

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Contents

P a g e  07

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

Next

 Making Ever-Better Cars [1 of 10]   

 Enriching Lives of Communities   

 Stable Base of Business

At Toyota, we believe we’ve worked harder than anyone else to build better cars.

  The ambition of our founder, Kiichiro Toyoda, was to establish an automobile industry in 

Japan based on Japanese technology and skill. This drive gave us the original Crown, as 

well as the ﬁ rst-generation Toyota Prius, the world’s ﬁ rst mass-produced hybrid car.

  The global ﬁ nancial crisis that began in 2008 reminded us once again that the foundation 

of sustainable growth is making cars that customers love. We changed direction, recommit-

ting all of our resources to making even better cars, and over the course of the following 

four years we signiﬁ cantly improved our manufacturing methods.

> How do we create ever-better cars that delight 
our customers?
> The deﬁ nition of a better car varies depending on 
the location.
>What is essential to building the better cars of the future?

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P a g e  08

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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Next

 Making Ever-Better Cars [2 of 10]   

 Enriching Lives of Communities   

 Stable Base of Business

How do we create ever-better cars that delight our customers?

Number of engine types

Number of 
types

Cumulative total

Engine
Engine 
series

Displacement
Displacement 
variations

Fuel
Fuel 
consumption
 and 
horse-
power 
variations

Platform
Platform, 
transmission,
drivetrain
variations

Exhaust 
Exhaust
regulation 
compliance, 
model 
variations

Source: Toyota Motor Corp.

What constitutes a better car?

dedicated to constantly delivering products and services 

  All Toyota cars share the same emphasis on quality, 

In terms of engine types, for example, this has resulted 

that always exceed the expectations of our customers. 

safety, and environmental performance. At the same 

in an increasing range of speciﬁ cations for displace-

What makes a car better? The answer to this question is 

We aim to inspire, excite, and create happiness.

time, with regard to design, handling, ride, and equip-

ment, horsepower, fuel consumption, platform, and 

different for each customer and it varies depending on 

where they are. We believe that a car that brings a smile 

to the face of a customer is without a doubt a better car. 

However, when it comes to making ever-better cars, 

there is no magic bullet, no ﬁ nish line. This is why we are 

INSIGHT The Toyota 86 reignited people’s love of cars

ment, they also have the unique characteristics that our 

drivetrain in addition to modiﬁ cations in compliance with 

customers expect from better cars. Toyota has always 

country-speciﬁ c exhaust regulations. To continue 

followed an optimized development process for each 

making ever-better cars, we must constantly reassess 

car model, and the number of models in each line has 

the way development is optimized for each car model.

expanded in tandem with increasing production volume. 

INSIGHT Each car is the product of connections between people

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P a g e  09

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

Next

 Making Ever-Better Cars [3 of 10]   

 Enriching Lives of Communities   

 Stable Base of Business

How do we create ever-better cars that delight our customers?

How to standardize parts and units

What is required of ever-better cars

Representation of vehicle volume

Zone A

Zone B

Zone C

Zone D

New concept cars

Shift to zone B in the future

Focus on interests and sensibilities 
(particularly for sports cars)

High-volume cars for individuals and 
the general public

Special-purpose vehicles, taxis, 
commercial vehicles

Next-generation vehicles
(Environment-friendly cars, 
new concept cars)

aaarsrsrsr  wittittithhh unnnnniqiqiqueeee chaahaaharacttctcteeerisistititics 
CaCCa
ddd
dududuuue e e tooototo rrregegegioioioionananaaalll opoppoptitittit mimimizazazazaz tititionononon  
annnnd didddd fferrreeentiataaa ionnn

Appealing cars

Product 
lineup

Medium- to long-term 
plans

Architecture

Toyota’s car manufacturing 
design concepts

LFA

CROR WNWWW
CROWN

HIAHH CEE WELEE CABAA
HIACE WELCAB

PRIUS

TOYOTA i-ROAD

Customer expectations

Modules and parts

Grouped planning & 
development
Compatible systems and 
parts families

Parts developed for medium- 
to long-term scenarios

• Individualistic designs
• Excitement and inspiration
• Superior driving performance
•  Emotional engagement and 

• Appealing designs
• High basic performance 
• Ease of use
• Price and affordability

sensory appeal

• Durability
• Ease of use
• Price and affordability

• New concepts
• New technologies
•  Environment-friendly/energy-

saving features

Common items: quality, safety, environmental performance

Improving basic ride, 
turning, and braking 
performance

Us

sini g hihhh gh-q---- uaalllity bbbbasiccc parrrts 
anananaa d dd shssshsharrararrinining gg thththtt ememmemm aaacrcrcrrrosososs ss
d
differeneee t vevvvv hiclcc e seeeegmgmgmg entsss

Source: Toyota Motor Corp.

Consistently delivering better cars to customers

  The Toyota New Global Architecture (TNGA) is our 

medium- to long-term product lineup and release 

toward optimizing processes in each region—for exam-

framework for making ever-better cars for a wide variety 

schedule, then grouping models within the lineup. 

ple, matching interior cabins, exterior designs, and driv-

Toyota divides the vehicles it makes into four zones: 

of customers and regions in smarter and more efﬁ cient 

Toyota intends to raise the competitiveness of basic 

ing performance to the preferences of our customers. 

exciting, high performance vehicles; appealing yet prac-

ways, with the ultimate aim of creating products that stir 

parts relating to ride, turning, and braking to world-class 

By grouping and unifying optimal driving positions and 

tical vehicles; commercial and heavy-duty vehicles; and 

our customers’ emotions.

levels, and it is now able to standardize parts and units 

hip-point heights, we are able to share common cockpit 

next-generation vehicles. In our pursuit of ever-better 

cars, we listen to our customers to understand their 

expectations regarding design, driving performance, 

ride, and equipment in each of these zones.

  Just as a road determines the cars that will be driven 

on it, collaboration between the members of marketing 

INSIGHT Our engineers always keep customer expectations ﬁ rmly in mind

Smarter and more efﬁ cient

across different models through grouped development 

modules and parts across different car models and plat-

that puts multiple models through the planning process 

forms. This, in turn, allows us to cut both the number of 

at the same time. For example, we have separately 

part variations and engineering man-hours.

standardized the parts and units for compact, mid-

  Under TNGA, Toyota is increasing standardization 

sized, and large platforms (chassis) respectively. Based 

while enhancing basic performance and product appeal 

on the new vehicle architecture, we aim for full optimiza-

above and beyond customer expectations. We expect 

and R&D teams around the world, as well as staff from 

In line with TNGA, Toyota aims to make ever-better cars 

tion by standardizing even more basic parts, including 

TNGA to result in lower basic costs and contribute to 

Japan, enables us to make cars that delight customers 

more efﬁ ciently by simultaneously cutting basic costs 

platforms and powertrains, across vehicle segments. So 

enhanced proﬁ tability. Toyota plans to start unveiling 

the world over. Toyota’s design and R&D bases in nine 

and substantially improving product appeal—which at 

far, Toyota has developed three front-wheel-drive plat-

new car models developed under TNGA from 2015.

locations outside Japan are key components of its global-

ﬁ rst glance may seem to be contradictory goals. Toyota 

forms and plans to develop several car models based 

ized and localized operations, which integrate develop-

applies a distinct planning and development process 

on each of these platforms. This streamlining has 

ment, engineering, manufacturing, sales, and services.

with each car model, ﬁ rst ﬁ nalizing the projected 

resulted in extra R&D capacity, which we are directing 

ANNUAL REPORT 2013

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Contents

P a g e  10

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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Next

 Making Ever-Better Cars [4 of 10]   

 Enriching Lives of Communities   

 Stable Base of Business

How do we create ever-better cars that delight our customers?

Bringing out our true competitiveness

  We believe that sustainable growth can only be 

  Competitiveness cannot be created overnight, nor 

achieved by focusing on areas where we are truly 

should it be regarded as a measurement derived from 

Continuing to concentrate investments in 
growth areas

Toyota has been selling automobiles around the world 

competitive over the longer term, both inside and 

short-term proﬁ ts and costs, which ﬂ uctuate depending 

With further growth in sales volume likely, Toyota is 

ever since the ﬁ rst Crown was exported to the United 

outside Japan. In Japan, for example, because of its 

on prevailing business conditions. Competitiveness is a 

working hard to improve productivity. We are placing top 

States in 1957. Today, Toyota vehicles are driven in 

long history in the country, Toyota has a robust manu-

multifaceted challenge that cannot be measured with 

priority on maximizing capacity utilization and making 

more than 170 countries and regions. In line with our 

facturing foundation replete with advanced technolo-

data or numbers; it is the sum of countless factors, such 

effective use of our existing plants and manufacturing 

policy of producing where there is demand, since the 

gies, manufacturing expertise, talented human 

as a company’s ability to nurture human resources, a 

facilities from a global perspective. Over the next three 

early 1980s Toyota has progressively increased its car 

resources, and a multilayered supply network. It is this 

corporate culture that pursues greater productivity 

years we plan to concentrate on modernizing existing 

production in countries where its vehicles are sold. From 

foundation that has supported Toyota’s global ambi-

through better quality and shorter lead times, the ability 

facilities rather than building new plants (excluding those 

2001 onward, Toyota expanded production outside 

tions. Japan is and always will be central to the 

to innovate, and marketing skills, including after-sales 

for which construction is already planned or in progress).

Japan in accordance with sharp growth in sales, and in 

Company’s ability to make competitive cars and create 

services. The current degree of our competitiveness 

  We will continue to make capital investments that are 

2007 its overseas production exceeded its production in 

innovative manufacturing technologies. To be truly 

varies by country and region. Looking at the situation 

necessary to sustain growth, and will focus on investing 

Japan for the ﬁ rst time. Toyota now has 51 manufactur-

competitive, we think it is crucial to further increase 

from both the medium- and long-term perspectives, 

more efﬁ ciently. Toyota has made signiﬁ cant progress 

ing bases in 26 countries and regions. Having learned a 

Japan’s competitiveness as a global base. Toyota has 

Toyota is poised to reﬁ ne and improve its competitive-

toward its goal of reducing the basic unit of capital 

great deal from the recent global ﬁ nancial crisis, 

been producing three million cars annually in Japan for 

ness. We have put in place groupwide systems that will 

invested in model redesigns by 40% compared to the 

however, Toyota has now begun to transition to a 

more than 30 years, and this production structure has 

enable us to continue making ever-better cars that are 

levels seen before the global ﬁ nancial crisis. While keep-

sustainable growth model, shifting its focus away from 

laid the foundation of the manufacturing competitiveness of 

proﬁ table and excel in quality.

ing total investment at an optimal level, Toyota will 

volume-driven growth.

the Toyota Group, including its network of suppliers.

INSIGHT The QC team’s job is to deliver zero defects

continue its policy of concentrating investment in regions 

that are expected to grow—particularly in emerging 

markets, where we will step up investments substantially.

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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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How do we create ever-better cars that delight our customers?

LEXUS ES 350

Toyota Motor Manufacturing Kentucky

AVALON

CROWN

INSIGHT Our teams design appealing cars that turn heads

Strengthening manufacturing competitiveness

proﬁ le of the Crown, with lines that leap forward, 

with one another to facilitate the development and engi-

ago in 1988. TMMK now produces half a million cars 

evolved out of intense discussions and collaboration 

neering processes. This facility is playing a key role in 

a year, including the Camry and Avalon, for the U.S. 

The latest Crown model, inspired by the slogan “Taking 

between designers and manufacturing technology engi-

shortening development times and standardizing 

market, and is a core manufacturing base, having 

on the challenge of innovation,” has emerged as a 

neers. These discussions led to major advances in 

designs, with the ultimate aim of creating innovations 

produced a signiﬁ cant portion of the 25 million cars 

symbol of Toyota’s “ReBORN” campaign. Representing 

design and production techniques, giving the car an 

that exceed the expectations of our customers.

made by Toyota in North America as of the end of 

the pinnacle of Japanese manufacturing, the Crown is in 

undeniable sense of presence. To create a better car, 

  We aim to strengthen our competitiveness and enable 

October 2012. In addition, the fourth-generation Avalon, 

the vanguard of our drive to make ever-better cars. 

we overhauled our previous approach of simply discard-

sustainable growth through the provision of high-quality 

which ﬁ rst rolled off the production line in October 2012, 

Sales of the new Crown surged from the start—in the 

ing aesthetic improvements on the basis that they were 

products in areas where we are truly competitive. In the 

was designed and developed entirely by U.S. teams. In 

ﬁ rst three months of its release we sold double our 

“inefﬁ cient.”

United States, for example, we continue to pursue the 

light of this enhanced competitiveness in the United 

target volume of 4,000 cars a month (the expected 

  A prime example of TNGA’s approach to development 

true competitiveness symbolized by the words “Made 

States, Toyota has decided to start making the Lexus 

average over the life of the model). The new Crown was 

process reforms can be seen at the new Powertrain 

by Toyota.” Nowhere is this commitment better demon-

ES 350 at TMMK in the summer of 2015. With the start 

created with the goal of making ever-better cars in mind, 

Development and Production Engineering Building, 

strated than at Toyota Motor Manufacturing, Kentucky, 

of ES 350 production, TMMK plans to expand its annual 

and required us to make major changes in the way 

where employees involved in the development of new 

Inc. (TMMK), which has been focusing on improving 

production capacity to 550,000 vehicles from its current 

everyone worked. For example, the distinctive side 

technologies and units are brought into close contact 

quality since it started production more than 25 years 

500,000.

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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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 Making Ever-Better Cars [6 of 10]   

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The deﬁ nition of a better car varies depending on the location.
Vios

Etios Valco

Etios

I n d i a

B r a z i l

I n d o n e s i a

(cid:129)  A cut above the rest, with an elegant design that 

T h a i l a n d

(cid:129)  Compact car developed from the ground up for emerg-

(cid:129)  Steel plates protecting the underbody of the car from 

(cid:129)  Bioethanol-compatible ﬂ ex fuel speciﬁ cations

loose rocks on rough roads

(cid:129)  Stability while driving on highways, and a comfortable 

evokes status

ing markets

(cid:129)  Beverage holder capable of carrying seven one-liter 

ride on rough roads 

(cid:129)  One-touch power windows and other extras in high 

(cid:129)  Dynamic, elegant and clean exterior; pleasant interior 

bottles

(cid:129)  Dust prooﬁ ng speciﬁ cally for customers in Brazil, where 

demand locally

offering value for money

(cid:129)  Air conditioner vents arranged side-by-side to circulate 

dust can be a problem

(cid:129)  Extremely roomy interior and plenty of storage space

(cid:129)  Optional package offering superior comfort in rear seats

cool air to the rear seats

(cid:129)  Best-in-class fuel economy with 17.6 kilometers per liter 
of gasoline (calculated according to Indian standards)

g

(

(cid:129)  Smooth ride and comfort on rough roads

(cid:129)  Best-in-class fuel economy

(cid:129)  Best-in-class fuel economy

(cid:129)  Optimizations based on 101 factors speciﬁ c to the 

s based on 101 factoototors speciﬁ c to th
izations based on 101 fac rs speciﬁ c to th
Indian market 
 markeet 

on 101 fa

Accelerating the development of compact cars in 
emerging markets

for emerging markets, with the launch of the Innovative 

and the Middle East, and as of March 2012 a cumula-

markets. The Vios is currently produced and sold in 

International Multipurpose Vehicle (IMV) series in 2004 

tive total of 5 million IMVs have been sold worldwide.

Thailand, Toyota’s largest production base in the ASEAN 

Toyota has reorganized its automotive operations into 

heralding a particularly important turning point. The IMV 

  The IMV series was developed as a globally inte-

region, and there are plans to export it to more than 80 

four business units to propel the company toward 

series was developed for sale in more than 140 coun-

grated model for all regions; however, starting in 2010 

countries.

achieving the Toyota Global Vision. The Lexus brand is 

tries, and Toyota began manufacturing ﬁ ve base models 

with the launch of the Etios compact car, Toyota began 

  Toyota’s guiding philosophy since its foundation has 

now independent, and Toyota brand operations are 

divided into those in emerging markets and those in 

in ﬁ ve countries simultaneously. A local parts procure-

to manufacture a range of cars that better reﬂ ect the 

been to contribute to communities the world over 

ment ratio of 100% was targeted, thereby keeping car 

needs of each region. With the launch of sedan and 

through localized operations. Our desire to exceed the 

North America, Europe, and Japan to reﬂ ect their mark-

body prices competitive. At present, the IMV series is 

hatchback versions of the Etios, Toyota now has a total 

expectations of each and every customer has led us to 

edly different business models and to accelerate deci-

manufactured in 12 countries and regions, with 

of eight compact cars designed for emerging markets 

promote the development of the automotive industry 

sion making in tune with local market needs.

Thailand, Indonesia, Argentina, and South Africa posi-

and plans to sell them in more than 100 countries.

around the world.

  Toyota has progressively expanded its operations in 

tioned as four global supply bases. Diesel engines are 

  Production of the Etios commenced in India (2010), 

emerging markets (especially in ASEAN countries) since 

made in Thailand, gasoline engines are made in 

followed by Brazil (2012), and most recently Indonesia 

the 1960s. In Southeast Asia, Toyota has endeavored 

Indonesia, and transmissions are made in the 

(2013), at Toyota’s second plant in Karawang. The Etios 

for years to build relationships of trust, weathering the 

Philippines and India. These components are then 

Valco hatchback has quickly become the “national car 

Asian currency crisis to steadily deliver cars that match 

supplied to the countries that make the car bodies. IMV 

of Indonesia.”

customer preferences. These efforts have culminated in 

series vehicles are sold in 170 countries and regions 

  Toyota also manufactures the Vios, a compact car 

the development of compact cars designed speciﬁ cally 

throughout Asia, Europe, Africa, Oceania, Latin America, 

designed as a step up from the Etios, in emerging 

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President’s Message

Launching a New Structure

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Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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The deﬁ nition of a better car varies depending on the location.

The increasing importance of localized R&D

Our R&D bases allow us to make ever-better cars that 

are competitive in each region. They develop car bodies 

and parts in line with local needs, optimize powertrains 

to comply with local regulations, and expand the local 

procurement of parts in cooperation with local suppliers.

  As a core base in the Asia/Oceania region, Toyota 

Motor Asia Paciﬁ c Engineering and Manufacturing Co., 

Ltd. (TMAP-EM) collaborates with nearby R&D bases to 

develop cars speciﬁ cally for emerging markets. To put 

the ﬁ nishing touches on its local development structure, 

TMAP-EM plans to add to its team of roughly 600 

employees to bolster its product planning, testing, and 

prototyping capabilities.

  Toyota Motor Engineering & Manufacturing (China) 

Co., Ltd. (TMEC), located in Changshu City, Jiangsu 

Province, conducts research and development in collab-

oration with the R&D centers of two joint ventures 

engaged primarily in the development of car bodies. To 

develop cutting-edge fundamental technologies, TMEC 

oversees the development of engines for cars produced 

in China, tests and conducts performance evaluations 

on a large-scale test course, and develops environmen-

tal technologies. Since the widespread use of eco-cars 

beneﬁ ts the environment, TMEC is working toward the 

production of eco-cars in China. At the Beijing 

International Automotive Exhibition in April 2013, TMEC 

showcased its accomplishments by exhibiting the 

Yundong Shuangqing II concept car, which features 

hybrid components that are currently in development.

Toyota’s presence in emerging markets

VIOS

Aftab Automobiles Ltd. 
(Bangladesh)
LAND CRUISER

IMC (Pakistan)
COROLLA, HILUX

TMMBC (Mexico)
TAKOMA

COROLLA

AAV (Egypt)
FORTUNER

China

S  1964
P   1999

SFTM (China)
COASTER, LAND CRUISER, LAND 
CRUISER PRADO, PRIUS

TFTM (China)
VIOS, COROLLA, 
CROWN, REIZ, RAV4

GTMC (China)
CAMRY, YARIS, HIGHLANDER, 
CAMRY HYBRID

Taiwan

S   1949
P   1986

Kuozui Motors, Ltd. 
(Taiwan)
CAMRY, COROLLA, 
WISH, VIOS, YARIS, 
INNOVA

TMV (Vietnam)
CAMRY, COROLLA, VIOS, 
INNOVA, HIACE, FORTUNER

TMP (Philippines)
INNOVA, VIOS

Legend
For each country/region:
S = Start of sales
P = Start of production

 Producer 
PPPP
(n
(name of country or region)

 Main models produced 
(as of September 2012)

Source: Toyota Motor Corp.

Yundong Shuangqing II concept car at the 12th 
Beijing International Automotive Exhibition

TDV (Venezuela)
COROLLA, FORTUNER, HILUX

AVA (Kenya)
LAND CRUISER

DYNA

Malaysia

S   1967
P   1982

ASSB (Malaysia)
HIACE, VIOS, COROLLA, 
HILUX, INNOVA, FORTUNER

Brazil

S  1958
P  1959

TDB (Brazil)
COROLLA, ETIOS

Argentina

S   1978
P   1997

TASA (Argentina)
HILUX, FORTUNER

South Africa

S  1962
P   1962

TSAM (South Africa)
COROLLA, HILUX, FORTUNER, 
DYNA, HIACE

India

S  1985
P  1999

TKM (India)
COROLLA, INNOVA, 
FORTUNER, ETIOS

AVANZA

Thailand

S  1962
P  1964

TMT (Thailand)
VIOS, COROLLA, CAMRY, 
CAMRY HYBRID, PRIUS, 
YARIS, HILUX VIGO, 
FORTUNER

Indonesia

S   1971
P   1977

HMMI (Indonesia)
DYNA

ADM (Indonesia)
AVANZA

TMCA (Australia)
CAMRY, CAMRY HYBRID

TMMIN (Indonesia)
INNOVA, FORTUNER, ETIOS 
FALCO

 
 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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What is essential to building the better cars of the future?

 Hybrid vehicle sales volume 
(Thousands of units)

(Millions of units)

(Thousands of units)

Hybrid vehicle share of Toyota product mix by region

1,800

1,500

1,200

900

600

300

0

(CY)

Lineup of hybrid vehicles in all categories

117 
months

27 
months

18 
months

14 
months

11 
months

5
million

4
million

3
million

As of August 2013, Toyota sells 23 hybrid vehicle 

models (including a plug-in hybrid) in approximately 

80 countries and regions. Toyota plans to launch 15 

new hybrid vehicle models by the end of 2015.

2
million

1
million

6

5

4

3

2

1

0

40%
680

800

600

400

200

7%
100

0

15%
350

10%
250

13%
110

5%
50

1997

1999

2001

2003

2005

2007

2009

2011

(cid:2) Annual sales   (cid:3) Cumulative sales (right scale)

2013
Jan.-Mar.
(Mar. 31, 2013)

Japan

North America

Europe

(cid:2)  2008   (cid:2)  2012

Source: Toyota Motor Corp.

Hybrid vehicles are no longer “niche” products

creating ever-better cars will require us to focus our 

about 14% on a global basis. Hybrid vehicles are no 

efforts on a wide range of technological initiatives, such 

longer “niche” products, and Toyota considers hybrid 

The environment is one of Toyota’s top management 

as the development of non-hybrid eco-cars that are 

technology to be the core environmental technology of 

Impact of the widespread use of 
hybrid vehicles

priorities. We have promoted the proliferation of hybrid 

compatible with other types of fuels.

the 21st century. As a result, the Company is focusing 

As of March 31, 2013, Toyota estimates that the 

vehicles since the introduction of the original Prius in 

In March 2013, 15 years and seven months since the 

on hybrid technology, which can work in tandem with a 

1997 because we believe that the widespread use of 

ﬁ rst hybrid vehicle was launched in August 1997, the 

wide variety of fuel types and which includes all of the 

eco-cars will beneﬁ t the environment. To encourage 

number of hybrid vehicles sold by Toyota topped the ﬁ ve 

fundamental technologies necessary to make eco-cars, 

more customers to choose hybrid vehicles (the most 

million mark. As of August 2013, Toyota sells 23 hybrid 

as well as developing eco-cars other than hybrid vehicles.

popular type of eco-car on the market), we have been 

vehicles, including one plug-in hybrid, in about 80 coun-

focusing on enhancing performance, reducing costs, 

tries and regions. In 2012, hybrid vehicles accounted for 

and expanding our lineup. In addition, we believe that 

around 40% of all cars sold by Toyota in Japan, and 

combined effect of all the hybrid vehicles it has sold is an 

approximately 34 million ton reduction in CO2 emissions 

(assuming that gasoline engine cars of an equivalent 

class, size, and horsepower would have been sold 

instead). Toyota estimates that the amount of gasoline 

saved is equivalent to about 12 million kiloliters (using an 

equivalent class of gasoline engine car as a benchmark).

 
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President’s Message

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Financial Section

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What is essential to building the better cars of the future?

Measures to reduce air resistance

Unit: Coefficient of drag

Resistance to vehicle motion
when driving at 100km/h

0.55

0.50

0.45

0.40

LAND CRUISER

ROLLA
A
COROLLA

RAV4R
RAV4

EEEEE
ESESESEE TIMA
ESTIMA

0.35

RLELELELEETTTTRLET
STARLET

CELSIOR
CELSIOR

0.30

0.25

0.20

(Year)

1980

Rolling 
resistance: 
30%

Air resistance: 
about 70%

SUVs
SUVs

Minivans
Minivans

Hatchbacks
Hatchbacks

Sedans
Sedans

PRIUSS
PRIUS

[Overview of the Aerodynamics Laboratory]

Wind tunnel type:  

 Circuit, low-noise driving simula-
tion wind tunnel

Maximum wind speed:  250 km/h

Fan:  

 9m fan diameter; 
8,000kW output

Air portal dimensions:   7m wide × 4.5m high

Tunnel dimensions:  

 110m long, 52m wide, 
27m high

Aerodynamics Laboratory

1990

2000

2010

2020

Main equipment:  

 Six-component balance with 
5-belt moving belt system, 
sound analysis system, 
wide-area, three-dimensional 
ﬂ ow analysis system

Source: Toyota Motor Corp.

Vehicle testing at the Aerodynamics Laboratory

Large wind tunnel fan

Promoting the further uptake of hybrid vehicles

drag for a compact hybrid vehicle is reduced from 0.30 

Center contains a newly constructed Aerodynamics 

During the 12 years between the launch of the ﬁ rst Prius 

to 0.25 at this speed, fuel economy improves by about 

Laboratory for conducting research into reducing air 

and the launch of today’s third-generation Prius, Toyota 

Toyota aims to make hybrid vehicles more appealing to 

8%. Toyota has already achieved a high level of aerody-

resistance, improving driving performance, and reducing 

managed to reduce the cost of the hybrid system to 

a wider range of customers by improving performance, 

namic performance in its cars, with the Prius as a prime 

wind noise, all of which will enable us to develop ever-

only one-third of the original cost.

reducing costs, and expanding its lineup.

example. Nevertheless, Toyota continues to develop 

better cars.

  Toyota is improving aerodynamic performance by 

technologies to enhance aerodynamic performance 

  With regard to cost reductions, Toyota has substan-

reducing the vehicles’ air resistance. Air resistance 

even further by improving the exterior shape, vehicle 

tially reduced the cost of hybrid systems while signiﬁ -

accounts for approximately 70% of the resistance to vehi-

package, ventilation, airﬂ ow around the tires, and airﬂ ow 

cantly improving fuel economy by optimizing the hybrid 

cle motion at 100 kilometers per hour. If the coefﬁ cient of 

under the body of the car. The Head Ofﬁ ce Technical 

system with each successive generation of the Prius. 

  Toyota plans to launch 15 new hybrid vehicle models 

globally between August 2013 and December 2015.

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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

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Review of Operations

Management and 
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Financial Section

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What is essential to building the better cars of the future?

Toyota is developing a variety of next-generation eco-cars that leverage its advanced hybrid technologies.

Breakdown of mobility in the future

PHV

EV

Motor

Large-
capacity 
battery

Engine

Fuel 
tank

Motor

Large-
capacity 
battery

Fuel cell vehicles
Fuel cell vehicles

Hybrid and plug-in hybrid vehicles 
Hybrid and plug-i n hybri d vehicles 

Electric vehicles
Electri c vehi cles

Passenger cars
Passenger cars

Metropolitan buses
Metropolitan buses

Large trucks
Large trucks

High-speed railw
High-speed railway

Zero CO2 emissions over a limited range

Compact delivery 
Compact delivery
vehicles
vehicles

Short-distance 
Short-distance 
applications
applications

Vehicle size

FCV(BUS)
FCV(BUS)

HV
HV

Delivery trucks
Delivery trucks

Ordinary railway
Ordinary railway

EV
EV

FC
FCV-R
FCV-R

WinWinglet
Winglet

PHV
PHV

i series
i-series
i-series

Motorcycles
Motorcycles

Energy source

Electricity,

gasoline, diesel, biofuel, CNG, synthetic fuel, etc.

Hydrogen

Electric vehicles: short-distance applications

Hybrid vehicle and plug-in hybrid vehicles: passenger cars

Fuel cell vehicles: medium and long-distance applications

Source: Toyota Motor Corp.

Motor

Battery

Engine

Fuel 
tank

HV

FCV

Zero CO2 emissions 

Motor

Battery

FC
stack

Hydrogen 
tank

What will be the next winner among eco-cars?

prevent atmospheric pollution but also provide 

  Fuel cell vehicles (FCVs) also represent a key technol-

  Toyota is working to create compact, high-

economic beneﬁ ts in the form of lower fuel and electric-

ogy of the future. These vehicles are powered by elec-

performance fuel cell systems at lower cost with the 

Toyota believes that next-generation eco-cars will use 

ity costs. Moreover, if electricity generated by solar 

tricity generated by the chemical reaction between 

aim of introducing a sedan-type FCV around 2015 in 

plug-in hybrid technology, a new concept that combines 

power is used to recharge car batteries, CO2 emissions 

oxygen in the air and hydrogen, and have numerous 

major cities where it would be relatively easy to build 

the beneﬁ ts of hybrid and electric vehicles. The batteries 

can be reduced to signiﬁ cantly lower levels. This is why 

potential beneﬁ ts, including zero CO2 emissions while 

the necessary infrastructure.

of plug-in hybrid vehicles can be recharged directly from 

we believe that plug-in hybrid vehicles will be the winner 

driving, a range comparable to a similar gasoline-

household electrical outlets, and charging batteries 

among next-generation eco-cars. Generating, conserv-

powered car, and the fact that hydrogen can be 

allows vehicles to operate primarily in EV mode over 

ing, and storing energy at the household level will 

produced from a variety of primary energy sources. The 

short ranges. Plug-in hybrid vehicles operate as conven-

become possible through the skillful management of 

hybrid technologies honed by Toyota to date are vitally 

tional hybrid vehicles once their batteries have been 

electricity used to recharge electric or plug-in hybrid 

important to the development of FCVs. However, the 

depleted. As the driving range of electric vehicles 

vehicles and electricity used inside homes. Toyota is 

necessary infrastructure (i.e., hydrogen refueling 

increases, the amount of CO2 emitted and gasoline 

conducting R&D in this area.

stations) has yet to be put in place.

consumed decreases accordingly. This will not only help 

FCV-R concept car on display at 
the 2011 Tokyo Motor Show

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More than just providing transportation, the cars of the future will use information technology 

to serve a variety of functions that beneﬁ t both people and society as a whole. This vision 

underpins Toyota’s commitment to enriching lives of communities. In addition to supporting 

efforts aimed at realizing a low-carbon society through the development and promotion of 

eco-cars, Toyota is broadening its horizons as it seeks to improve day-to-day life and to bring 

smiles to the faces of future generations. To this end, we are engaging in the development of 

“smart communities,” environment-conscious cities featuring smart grids that link people with 

their cars and homes. We aim to help create a responsible and safe automobile society that 

emphasizes IT-based infrastructure.

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President’s Message

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How Toyota Plans to Enrich Communities

Charging the PHV PRIUS at home 

Estimates of household electric power consumption 
in Japan by application following growth in EV and 
PHV use

TVs

Lighting

Air 
conditioning

EV and PHV 
charging
33%

Water 
heaters 

Refrigerators

Other

Electric carpets

Source: Toyota Motor Corp.

TOYOTA i-ROAD, an EV concept car

Telematics service

Toyota believes that promoting the widespread use of 

  Toyota participates in testing and demonstrations 

mile” transfer needs) while offering clues to resolving 

of partner robots. To this end, we are leveraging the 

eco-cars will beneﬁ t the environment greatly. In addition, 

around the world to get closer to its goal of achieving 

inner-city transportation issues.

considerable technological know-how we have culti-

we recognize the importance of ﬁ nding new ways to link 

smart communities and a smart, high-mobility society. 

  Toyota is also contributing to society in the transporta-

vated in the industrial robotics ﬁ eld since the 1970s. 

people, the cars they drive, and the communities they 

This is why the TOYOTA i-ROAD, a twin-seater EV 

tion information ﬁ eld. Our Big Data platform, for example, 

Toyota aims to improve quality of life by developing 

live in. This includes meeting the power and recharging 

concept car designed to provide “exhilarating motion,” 

monitors trafﬁ c conditions using telematics services 

robots for nursing, medical, and home care purposes.

needs of drivers of plug-in hybrid (PHV) and electric 

is one of two EVs selected for an experimental car shar-

which gather information through in-car navigation and 

vehicles (EVs).

ing program that will provide ultra-compact EVs for 

mobile communication units. The Big Data platform 

  Enriching communities entails contributing to their 

short-distance travel in and around the city of Grenoble, 

achieved outstanding results in the aftermath of the 

INSIGHT Taking a “three are better than one” approach

development and welfare worldwide. This fundamental 

France. This project aims to determine the viability of 

Great East Japan Earthquake.

conviction has been key to Toyota’s growth over the 

providing an alternative means of transport for short 

In addition to the above, Toyota is contributing to 

years and is essential to its future sustainability.

distances of a few kilometers (often referred to as “last 

society and communities through the development 

INSIGHT We aim to make driving more fun

INSIGHT Robots can improve our quality of life

 
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 Stable Base of Business

Contributing to Society through the Manufacture of Cars

The F-Grid Concept

Energy ﬂ ow:
  Normal conditions

  Electricity 

Heat
  Emergency conditions

  Electricity 

The Kokoro Hakobu Project—
An initiative that supports disaster-stricken areas

Mobile power source 

during emergencies

The Toyota East Japan Technical Skills Academy, 
an in-house training facility established to 
strengthen manufacturing capabilities in the 
Tohoku region

Supporting the swift recovery of 
local communities during emer-
gencies using a variety of facili-
ties and devices, including solar 
panels, storage batteries, and 
satellite phones

The Toyota East 
Japan 
Technical 
Skills 
Academy

Artist’s depiction of a factory and industrial complex based 
on the F-Grid Concept

Toyota aims to be a good corporate citizen, and contrib-

the support activities carried out in the immediate after-

a major tipping point for us. The earthquake and its 

and scale, the F-Grid is expected to achieve energy 

utes to society through a range of unique projects. From 

math of the Great East Japan Earthquake. 

aftermath made us realize the considerable amount of 

savings of 20% and reduce emissions by nearly 30%. 

global perspectives, we channel our energies toward 

  Since its foundation, Toyota has worked diligently to 

time a full recovery requires, and we asked ourselves 

The project also aims to provide electricity (together with 

key ﬁ elds, such as the environment, trafﬁ c safety, and 

uphold the principle of contributing to society by making 

what we could do on a more permanent basis to work 

local power companies) to the local community during 

human resource development. In Japan, we place 

ever-better cars. In an effort to position the Tohoku 

with and support society. We realized that we could best 

emergencies. Hybrid vehicles such as the Aqua and 

considerable emphasis on society and culture and have 

region as the Company’s third major production base in 

help the region by expanding local manufacturing activi-

Prius can also generate and store power.

been recognized for our efforts. We received the 2012 

Japan after the Chubu and Kyushu regions, Toyota 

ties, which, in turn, led to the establishment of TMEJ. 

  By leveraging its manufacturing strengths, Toyota 

Mécénat Award for Supporting Hearts in recognition of 

established Toyota Motor East Japan, Inc. (TMEJ). The 

Moreover, we have launched the Factory Grid (F-Grid) 

intends to position its factories at the heart of its efforts 

our efforts under the Company’s Kokoro Hakobu Project, 

Aqua, Japan’s top-selling hybrid hatchback in ﬁ scal 

Concept, which aims to facilitate safe, responsible, and 

to reenergize communities and provide society with 

which aims to support reconstruction and revitalization 

2013, is manufactured by TMEJ. Of the approximately 

comfortable lifestyles. Spearheaded by TMEJ, the proj-

unique and innovative services. Moving forward, Toyota 

efforts in disaster-stricken areas. Organized by the 

8,700,000 vehicles produced by Toyota worldwide in 

ect will create a smart community through comprehen-

will continue to contribute to local communities though 

Association for Corporate Support of the Arts, the 

ﬁ scal 2013, around 500,000 were produced in the 

sive energy management that encompasses the entire 

conscientious manufacturing.

award presented to the Company was speciﬁ cally for 

Tohoku region, and TMEJ is becoming a major compact 

industrial area as well as the surrounding area. Under 

INSIGHT The “F-Grid” shows us what future communities could look like

INSIGHT We see the global environment as a core customer

  The Great East Japan Earthquake, which devastated 

energy self-sufﬁ ciency ratio of approximately 70%. 

INSIGHT Cars will change the lifestyles of the future

car production center and exporter.

the F-Grid Concept, efforts will be made to secure an 

INSIGHT A crisis is emerging in one of the world’s most forested countries

the Tohoku region of Japan on March 11, 2011, was 

Compared with industrial complexes of a similar size 

 
 
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President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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 Enriching Lives of Communities   

 Stable Base of Business [1 of 4]

First and foremost, we strive to make ever-better cars and enrich communities in order to 

achieve sustainable growth and a stable business foundation. This ever-growing stable busi-

ness foundation, in turn, provides us with the strength to make ever-better cars and enrich 

society. It is a virtuous circle. In 2011, we unveiled the “Toyota Global Vision.” We feel conﬁ -

dent that we are now within sight of ensuring sustainable proﬁ tability, a key tenet of the 

vision. Toyota’s business environment, however, changes from moment to moment, meaning 

that we must constantly strive to secure forward-looking human resources and improve efﬁ -

ciency. In this context, we realize that crucial intangible attributes, such as a corporate ethos 

that is conducive to innovation, cannot be ignored in our quest for sustainable growth.

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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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 Making Ever-Better Cars   

 Enriching Lives of Communities   

 Stable Base of Business [2 of 4]

Message from the Executive Vice President Responsible for Accounting

Fiscal 2013 Business Results

Consolidated Financial Forecasts for Fiscal 2014

On a consolidated basis for the ﬁ scal year ended March 31, 2013, vehicle sales 

For the ﬁ scal year ending March 31, 2014, we forecast vehicle sales of 9.1 

increased 1.519 million units to 8.871 million units compared with the previous 

million units, net revenues of ¥23.5 trillion, operating income of ¥1.8 trillion and 

ﬁ scal year. Net revenues expanded ¥3.4805 trillion to ¥22.0641 trillion, operat-

ing income grew ¥965.2 billion to ¥1.3208 trillion, and net income rose ¥678.6 

net income of ¥1.37 trillion on a consolidated basis. Our exchange rate 
assumptions are ¥90 per US$1 and ¥120 per €1.

billion to ¥962.1 billion.

In our forecast for consolidated operating income, we expect exchange-rate 

  Factors that contributed to operating income included ¥650.0 billion from 

ﬂ uctuations (¥400 billion), cost reduction efforts (¥160 billion), and marketing 

marketing efforts, ¥450.0 billion from cost reduction efforts, ¥150.0 billion due 

efforts (¥80 billion) to be contributing factors. We also expect a ¥160.8 billion 

to exchange-rate ﬂ uctuations, and ¥15.2 billion due to other factors. Factors 

rise in expenses that will negatively affect operating income. However, the 

that were detrimental to operating income included a ¥300.0 billion rise in 

expected increase will be largely attributable to forward-looking expenditures, 

expenses. With regard to marketing, the volume of sales was higher in all 

such as R&D aimed at making ever-better cars. As such, we view these 

regions owing to supply shortages in the previous ﬁ scal year caused by the 

expenses as necessary investments for future growth. Meanwhile, we will 

Great East Japan Earthquake and ﬂ ooding in Thailand. In Japan, sales 

continue working to steadily improve earnings in our daily operations, including 

increased during ﬁ scal 2013 due in part to the invigorating effect of eco-car 

through companywide value analysis (VA) activities and other cost reduction 

subsidies on the market. In North America, sales of such mainstay models as 

efforts as well as measures to promote sales efﬁ ciency.

the Corolla and Camry remained strong amid robust demand. In Asia, sales 

  We have been aiming to establish a cycle of developing cars that delight our 

volumes grew substantially as the company rode market growth in each coun-

customers and beneﬁ t society while fulﬁ lling our duty to increase sales and 

try, especially in Thailand and Indonesia. Operating income also received a 

consequently proﬁ ts that are then reinvested in developing ever-better cars. To 

signiﬁ cant boost from a drive to reduce costs undertaken together with our 

support this cycle, we aim to maintain and build on a strong earnings base 

suppliers throughout the ﬁ scal year as well as a weakening of the yen in the 

through marketing, suitable controls on ﬁ xed costs and thorough cost reductions. 

second half of the ﬁ scal year.

I believe these results have positioned the company within reach of accom-

plishing its objective of creating a strong earnings base under the Toyota Global 

Financial Strategy

Vision announced in 2011.

The three key priorities of our ﬁ nancial strategy are growth, efﬁ ciency and 

stability. 

  We believe that the balanced pursuit of these three priorities over the 

medium to long term will allow us to achieve steady and sustainable growth, as 

well as increase corporate value.

We aim to achieve 
sustainable growth by 
maintaining and 
building on a strong 
earnings base.

 
 
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Launching a New Structure

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Highlights

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Management and 
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Financial Section

Investor Information

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Message from the Executive Vice President Responsible for Accounting

FY2014 Forecast: Consolidated Vehicle Sales

1.  Growth: Sustainable growth through continuous forward-looking 

growth in automotive markets, propelled by a recovery in the United States and 

(Thousands of units)
10,000

8,000

6,000

4,000

2,000

0

8,871

2,279

2,469

799
1,684

1,640

9,100

+229

2,120

-159

2,640

830

1,760

1,750

+171

+31

+76

+110

FY2013 Results

FY2014 Forecasts

Change

(cid:2) Japan    (cid:2) North America   (cid:2) Europe   (cid:2) Asia   (cid:2) Other 

investments

expansion in emerging markets. We believe that, in addition to putting crisis 

We believe that automotive markets worldwide will grow over the medium to 

measures into place, maintaining adequate liquidity is essential to the imple-

long term. As they expand, the focus of market growth is likely to shift toward 

mentation of forward-looking investment aimed at improving product appeal 

emerging markets and such fuel-efﬁ cient options as hybrid and compact vehi-

and the development of next-generation technologies as well as to the estab-

cles. We plan to invest efﬁ ciently and actively in these areas to meet structural 

lishment of global production and sales structures. We will continue to pursue 

shifts in demand and to ensure long-term sustainable growth. For example, we 

improvements in capital efﬁciency and cash ﬂow.

will prioritize the investment of management resources in the development of 

next-generation environmental technologies, such as fuel cells. We will also 

expand our lineup of hybrids and other eco-cars and sell them globally while 

Dividends and Share Acquisitions

increasing sales in emerging markets by strengthening locally produced models 

Toyota considers the enhancement of shareholder value a priority management 

and building an optimized supply structure. I believe we should work to realize 

policy and to this end is aiming for sustainable growth through corporate reor-

a balanced business structure as stated in the Toyota Global Vision, i.e., the 

ganization to increase corporate value. We aim to pay stable, ongoing divi-

FY2014 Forecast: Consolidated Financial Summary 

(Billions of yen)

“50:50 sales ratio,” with half of our sales coming from developed markets such 

dends, targeting a consolidated payout ratio of 30%, while giving due 

Net Revenues
Operating Income
Income before Income Taxes 
 and Equity in Earnings of 
Afﬁ liated Companies
Net Income Attributable to 
  Toyota Motor Corporation

FOREX Rates

Yen/US$
Yen/Euro

FY2014 Forecasts 
(Apr. 1, 2013– 
Mar. 31, 2014)
¥23,500.0
1,800.0

FY2013 Results 
(Apr. 1, 2012– 
Mar. 31, 2013)
¥22,064.1
1,320.8

1,890. 0

1,403.6

1,370.0

¥  90
120

962.1

¥  83
107

Change

¥1,435.9
479.2

486.4

407.9

¥  +7
+13

as Japan, the United States, and Europe and the other half from emerging 

consideration to such factors as performance each term, investment plans, 

markets.

and cash and cash equivalents. To succeed in this highly competitive industry, 

we plan to use retained earnings to quickly commercialize environment- and 

2. Efﬁ ciency: Improving proﬁ tability and capital efﬁ ciency

safety-related next-generation technologies, with emphasis on customer safety 

Toyota will continue its push forward with the Toyota New Global Architecture 

and peace of mind. Within this context, Toyota declared an annual dividend 

(TNGA), an initiative to overhaul the way we work with the goal of facilitating the 

payment of ¥90 per share for the ﬁscal year ended March 31, 2013.

timely launch of appealing products globally. Under TNGA, we are improving 

  Toyota did not acquire its own shares in the ﬁscal year ended March 31, 2013.

development efﬁ ciency and making ever-better cars by standardizing parts and 

  We will continue striving to further improve proﬁts and meet the expectations 

components through grouped development. Moreover, Toyota has improved its 

of our shareholders.

FY2014 Forecast: Consolidated Operating Income Analysis (vs. FY2013)

FY2013 Results

Positive 
Factors

Effects of FOREX Rates
Cost Reduction Efforts
Marketing Efforts

Financial Services

Subtotal

Increase in Expenses, etc.

Negative 
Factors

 FX Effects at Overseas Subsidiaries 
  (Translational)

Subtotal

Total
FY2014 Forecasts

(Billions of yen)

Operating Income
1,320.8
+400.0
+160.0
+80.0
-30.0
+640.0

-160.8

+60.0

-160.8

+479.2
1,800.0

ability to invest capital efﬁ ciently and is aiming to obtain the same results with 

less outlay. We will strive to further improve our earnings structure through efﬁ -

cient investment that emphasizes the areas in which we want to advance, 

including hybrids, other eco-cars, and emerging markets.

3. Stability: Maintaining a solid ﬁ nancial base

To ensure a solid ﬁnancial base, we secure sufﬁ cient liquidity and stable share-

holders’ equity. This allows us to maintain capital expenditure and R&D invest-

ment at levels conducive to future growth as well as to maintain working capital 

at a level sufﬁ cient for operations, even when business conditions are difﬁ cult 

due to such factors as steep increases in raw materials prices or volatility in 

foreign exchange rates. We plan to reﬁ ne and implement measures to improve 

business continuity planning in the event of a major disaster. Toyota anticipates 

July 2013

Nobuyori Kodaira

Executive Vice President

 
 
 
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Management and 
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What Sets Toyota Apart

Toyota has grown from a single core concept that is still 

>  The improvement process is inﬁ nite, and after-the-

 suggestions be made openly, discussed, and put into prac-

shared by the entire Group: contributing to society by 

fact improvements are in essence forward-looking 

Kaizen (Continuous Improvement)

making ever-better cars.

improvements

  Some of the values and ideas that have deﬁ ned 

These directives, which form part of Toyota’s manage-

Toyota over its 75-year history are listed below.

ment philosophy, are by no means limited to the 

INSIGHT We want to build a sense of unity

The Toyota Production System (TPS)

production front-line. They apply universally to all 

endeavors. In effect, TPS represents the building blocks 

of Toyota’s human resource development endeavors.

TPS encourages the complete elimination of waste, 

overburdening, and irregularities from the production 

Genchi Genbutsu 
(On-Site, Hands-On Experience)

process. The system, originally employed in the textile 

The genchi genbutsu principle refers to much more than 

tice to ensure continuous improvement.

INSIGHT We aim to be valued for our trustworthiness

Building “true competitiveness”

industry, is based on two fundamental concepts: jidoka, 

merely visiting a site to examine something in situ. It entails 

Representing a never-ending cycle of progress, the word 

which can be loosely translated as “automation with 

understanding and respectfully considering the opinions of 

kaizen encapsulates a spirit of striving for continuous 

a human touch,” and the Just-in-Time (JIT) principle. 

on-site individuals as well as of individuals who have exten-

improvement and a refusal to accept the idea that some-

To consistently deliver a higher level of quality and 

Under these concepts, if a problem occurs, the equip-

sive relevant knowledge. Genchi genbustu is thus a key 

thing cannot be made better. Toyota believes that acknowl-

competitive products to its customers, Toyota must 

ment immediately stops running, preventing the manu-

concept in the improvement process. Furthermore, the 

edging the possibility of continuous improvement can make 

continue to nurture a corporate culture that places the 

facture of defective products, and at each stage 

notion of “respect for people” is consistent with Toyota’s 

tasks easier and more enjoyable. From an organizational 

utmost value on quality, productivity, and cost efﬁ ciency. 

production is limited to only what is needed, when it is 

founding philosophy, and is underpinned by the concept of 

standpoint, kaizen involves the entire workforce while relying 

In addition to an unwavering commitment to JIT that 

needed, and in the amount needed.

thoroughgoing and direct communication.

on the extensive knowledge, skills, and experience of the 

underscores our commitment to the development of a 

>  Establish the facts through genchi genbutsu 

(on-site, hands-on experience)

>  Stop production lines when a problem occurs and 

implement corrective and improvement measures

The nature of the Toyota Production System

INSIGHT We continue to improve the traditional process of sintering

INSIGHT We are striving to cut energy use in half

people working directly on the process. The concept is 

short and efﬁ cient supply chain, we realize that we must 

based on individuals taking ownership of their work and 

also provide customers with a wide-ranging, compre-

focusing on what should be done rather than on what can 

hensive, and well-organized after-sales service network. 

be done. At the same time, the kaizen process is under-

From a long-term perspective, we can only stay 

pinned by thoroughgoing and direct communication. It is 

competitive if we continue to focus on developing 

essential to follow through once a decision has been 

human resources, fostering relationships of trust 

made upon thorough deliberation with the participation 

between management and labor, and ensuring that 

of all. We consider this a valuable part of our corporate 

each employee remains committed to conscientious 

culture. Taiichi Ono (1912-1990), a former Toyota executive 

manufacturing. For its part, Toyota will continue to hone 

vice president and founder of the Toyota Production 

its true competitiveness, which provides the underlying 

System, once commented that while the wisdom of 

strength for its manufacturing platform over the medium 

humankind was inﬁ nite, that wisdom tended to emerge only 

to long term. By doing so, we hope to ensure sustain-

during periods of adversity. When things are not going well 

able growth.

and a better method is discovered, it is critical that 

INSIGHT A smile from a customer is the sign of a job well done

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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

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Highlights

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Management and 
Corporate Information

Financial Section

Investor Information

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 [1 of 3]

Consolidated Performance Highlights
Consolidated Performance (U.S. GAAP)

Fiscal years ended March 31
  Net Revenues:
  Automotive
  Financial Services
  All Other

Inter-Segment Elimination

  Operating Income (Loss):

  Automotive
  Financial Services
  All Other

Inter-Segment Elimination

  Net Income (Loss) Attributable to Toyota Motor Corporation*2
  ROE
  ROA
As of March 31
  Total Assets
  Toyota Motor Corporation Shareholders’ Equity
  Short-Term Debt, Including Current Portion of Long-Term Debt
  Long-Term Debt, less Current Portion

2009

2010

¥20,529,570
18,564,723
1,377,548
1,184,947
(597,648)
(461,011)
(394,876)
(71,947)
9,913
(4,101)
(436,937)
-4.0%
-1.4%

¥29,062,037
10,061,207
6,317,184
6,301,469

¥18,950,973
17,197,428
1,245,407
947,615
(439,477)
147,516
(86,370)
246,927
(8,860)
(4,181)
209,456
2.1%
0.7%

¥30,349,287
10,359,723
5,497,997
7,015,409

Per Share Data:
  Net Income (Loss) Attributable to Toyota Motor Corporation*2
  Annual Cash Dividends
  Shareholders’ Equity
Stock Information (March 31)
  Stock Price
  Market Capitalization (Yen in millions, U.S. dollars in millions)

2009

2010

¥      (139.13)
100.00
3,208.41

¥         3,120
¥10,757,752

¥         66.79
45.00
3,303.49

¥         3,745
¥12,912,751

*1: U.S. dollar amounts have been translated at the rate of ¥94.05=US$1, the approximate current exchange rate at March 31, 2013.
*2: “Net Income attributable to Toyota Motor Corporation”, equivalent to “Net Income” up to 2009.

Millions of yen

2011

¥18,993,688
17,337,320
1,192,205
972,252
(508,089)
468,279
85,973
358,280
35,242
(11,216)
408,183
3.9%
1.4%

¥29,818,166
10,332,371
5,951,836
6,449,220

Yen

2011

¥       130.17
50.00
3,295.08

¥         3,350
¥11,550,792

2012

2013

U.S. dollars*1 in millions
2013

% change

2013 vs. 2012

¥18,583,653
16,994,546
1,100,324
1,048,915
(560,132)
355,627
21,683
306,438
42,062
(14,556)
283,559
2.7%
0.9%

¥30,650,965
10,550,261
5,963,269
6,042,277

¥22,064,192
20,419,100
1,170,670
1,066,461
(592,039)
1,320,888
944,704
315,820
53,616
6,748
962,163
8.5%
2.9%

¥35,483,317
12,148,035
6,793,956
7,337,824

$234,601
217,109
12,447
11,339
(6,294)
14,045
10,045
3,358
570
72
10,230
—
—

$377,281
129,166
72,237
78,020

+18.7
+20.2
+6.4
+1.7
—
+271.4
+4,256.9
+3.1
+27.5
—
+239.3
—
—

+15.8
+15.1
+13.9
+21.4

2012

2013

U.S. dollars*1
2013

% change

2013 vs. 2012

¥         90.21
50.00
3,331.51

¥         3,570
¥12,309,351

¥       303.82
90.00
3,835.30

¥         4,860
¥16,757,268

$      3.23
0.96
40.78

$    51.67
$178,174

+236.8
+80.0
+15.1

+36.1
+36.1

 
 
 
 
 
 
 
 
 
 
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Toyota Global Vision

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Consolidated Performance Highlights
Consolidated Performance (U.S. GAAP)

Net Revenues

Operating Income (Loss)/
Operating Income Ratio

(¥ Billion)
25,000

20,000

15,000

10,000

5,000

0

(cid:2)(cid:2) Operating Income (Loss)
(cid:3)(cid:3) Operating Income Ratio
(¥ Billion)
1,500

1,000

500

0

-500

Net Income (Loss) Attributable to 
Toyota Motor Corporation/ROE
(cid:2)(cid:2) Net Income (Loss) Attributable 
       to Toyota Motor Corporation   
(cid:3)(cid:3) ROE

(cid:2) Net Revenues: 

(cid:2) Operating Income 

¥22,064.1 billion  (  +18.7%)

1,320.8 billion  (+271.4%)

(cid:2) Net Income Attributable to Toyota Motor Corporation 

962.1 billion  (+239.3%)

(%)
15

10

5

0

-5

(¥ Billion)
1,000

750

500

250

0

-250

-500

(%)
20

15

10

5

0

-5

-10

Analysis of Net Income Attributable to Toyota Motor Corporation
(¥ Billion)

Net Income Attributable to Toyota Motor Corporation (+678.6)

Operating Income (965.2)
Excluding Valuation Gains/Losses from Interest Rate Swaps (+952.3)

FY

’09 ’10 ’11 ’12 ’13

FY

’09 ’10 ’11 ’12 ’13

FY

’09 ’10 ’11 ’12 ’13

R&D Expenses/Capital Expenditures 
for Property, Plant and Equipment 
(excluding vehicles and equipment 
operating leases)
(cid:2)(cid:2) R&D Expenses
(cid:2)(cid:2) Capital Expenditures for Property, Plant and Equipment
(¥ Billion)
1,500

Marketing 
Efforts
+650.0

Total Assets/ROA

(cid:2)(cid:2) Total Assets
(cid:3)(cid:3) ROA
(¥ Billion)
40,000

30,000

20,000

10,000

0

-10,000

(%)
8

6

4

2

0

-2

Note: “Net Income Attributable to Toyota Motor 
Corporation,” equivalent to “Net Income” up to 2009.

Toyota Motor Corporation
Shareholders’ Equity/
Shareholders’ Equity to 
Total Assets
(cid:2)(cid:2) Toyota Motor Corporation Shareholders’ Equity
(cid:3)(cid:3) Shareholders’ Equity to Total Assets
(¥ Billion)
15,000

(%)
50

12,000

9,000

6,000

3,000

0

40

30

20

10

0

283.5

0

FY2012

Cost 
Reduction 
Efforts
+450.0

Effects of 
FOREX 
Rates
+150.0

Increase in 
Expenses, 
etc.
-300.0

Other
+15.2

Non-
Operating 
Income
+5.5

Equity in 
Earnings of 
Affiliated 
Companies
+33.8

Income 
Taxes,
 etc.
-325.9

962.1

FY2013

’09 ’10 ’11 ’12 ’13

FY

’09 ’10 ’11 ’12 ’13

FY

’09 ’10 ’11 ’12 ’13

Net Revenues by Region

Japan

North America

Europe

Asia

Other Regions

Operating Income by Region
(¥ Billion)

576.3

* Figures for North America exclude valuation gains/losses from interest rate swaps.

+783.3

+28.7

+8.6

+119.2

+24.9

160.2*

188.9*

’13

’12

’13

17.7

’12

26.4

’13

256.7

’12

376.0

’13

108.8

’12

133.7

’13

’12

-207.0

’09 ’10 ’11 ’12 ’13

’09 ’10 ’11 ’12 ’13

’09 ’10 ’11 ’12 ’13

’09 ’10 ’11 ’12 ’13

’09 ’10 ’11 ’12 ’13

Japan

North America

Europe

Asia

Central and South America, 
Oceania and Africa

Note: Fiscal years ended March 31

1,200

900

600

300

0

FY

(¥ Billion)
15,000

12,000

9,000

6,000

3,000

0

FY

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 [3 of 3]

Consolidated Performance Highlights
Consolidated Vehicle Production and Sales

Thousands of units

2012

3,940
3,495
1,275
383
1,441
152
93
151
7,435

2,071
5,281
1,872
798
1,327
289
223
214
550
8
7,352

2011

3,721
3,448
1,338
372
1,344
148
113
133
7,169

1,913
5,395
2,031
796
1,255
281
248
209
569
6
7,308

Vehicle Sales

Fiscal years ended March 31
Vehicle Production by Region:
  Japan
  Overseas Total

  North America
  Europe
  Asia
  Central and South America
  Oceania
  Africa

Consolidated Total
Vehicle Sales by Region:
  Japan
  Overseas Total

  North America
  Europe
  Asia
  Central and South America
  Oceania
  Africa
  Middle East
  Other

Consolidated Total

2009

4,255
2,796
919
482
947
151
130
167
7,051

1,945
5,622
2,212
1,062
905
279
261
289
606
8
7,567

2010

3,956
2,853
1,042
433
1,021
146
106
105
6,809

2,163
5,074
2,098
858
979
231
251
184
466
7
7,237

[Reference] Vehicle Sales
>  Consolidated vehicle unit sales in Japan and overseas came to 8,871,000 
in the ﬁ scal year ended March 31, 2013, up 1,519,000, or 20.7%, com-
pared with the previous ﬁ scal year.

>  Consolidated vehicle unit sales in Japan were 2,279,000, an increase of 
208,000, or 10.1%, year on year. Excluding mini-vehicles, Toyota and 
Lexus vehicle unit sales (retail) was 1,612,000, up 162,000, or 11.2%, rep-
resenting a record market share of 48.4%.

>  Total vehicle unit sales (retail), including the Daihatsu and Hino brands, was 

also a historic high, reaching 9,692,000, a year-on-year increase of 
1,358,000, or 16.3%.

>  Consolidated Lexus vehicle unit sales came to approximately 500,000, around 
85,000, or 20.6%, higher than the previous ﬁ scal year. By geographic region, 
Lexus vehicle unit sales in Japan, North America, Europe, Asia, and other were 
about 42,000, 270,000, 43,000, 92,000, and 49,000, respectively.

* There are certain exceptional cases that do not follow the aforementioned ﬂ ow.

2013

4,276
4,422
1,677
368
1,924
205
100
148
8,698

2,279
6,592
2,469
799
1,684
364
271
259
741
5
8,871

% change

2013 vs. 2012

Vehicle Production by Region

+8.5
+26.5
+31.5
-3.9
+33.5
+34.9
+7.5
-2.0
+17.0

+10.0
+24.8
+31.9
+0.1
+26.9
+26.0
+21.5
+21.0
+34.7
-37.5
+20.7

(cid:2) Japan   (cid:2) Overseas Total

(Thousands of units)
10,000

8,000

6,000

4,000

2,000

0

FY

’09 ’10 ’11 ’12 ’13

Vehicle Sales by Region

(cid:2) Japan   (cid:2) Overseas Total

(Thousands of units)
10,000

8,000

6,000

4,000

2,000

0

FY

’09 ’10 ’11 ’12 ’13

Breakdown of Vehicle 
Production by Region
(cid:2) Japan   (cid:2) North America   (cid:2) Europe   
(cid:2) Asia   (cid:2) Other Regions

Consolidated Total: 

8,698 thousand units

5.2 %

22.1%

4.2%

FY2013

49.2%

19.3%

Breakdown of Vehicle Sales 
by Region

(cid:2) Japan   (cid:2) North America   (cid:2) Europe   
(cid:2) Asia   (cid:2) Other Regions

Consolidated Total: 

8,871 thousand units

18.5%

25.7%

FY2013

19.0%

27.8%

9.0%

 
 
 
 
 
 
 
 
 
 
 
 
 
 
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P a g e  27

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

Next

 Automotive Operations   

 Financial Services Operations   

 Non-Automotive Business Operations

Looking at conditions in the automotive market, 

Vehicle Sales by Principal Markets

Automotive Operations

The Company works diligently to produce ever-
better cars that exceed expectations in order to 
deliver products that bring smiles to the faces of 
people who choose Toyota.

In the ﬁ scal year under review, net revenues 
from automotive operations totaled ¥20,419.1 
billion, an increase of ¥3,424.5 billion, or 20.2%, 
compared with the previous ﬁ scal year. Operating 
income also climbed by ¥923.0 billion, year on 
year to ¥944.7 billion.

Net Revenues

(¥ Billion)
25,000

20,000

15,000

10,000

5,000

0

FY

’09

’10

’11

’12

’13

Operating Income (Loss)

(¥ Billion)
1,000

800

600

400

200

0

-200

-400

FY

trends mainly in the United States and emerging 

regions including Asia were ﬁ rm. Against this back-

drop, Toyota aggressively introduced new products in 

Japan and successfully expanded sales thanks to the 

efforts of dealers nationwide. Outside Japan, the 

Company boosted vehicle sales across all regions.

  The ﬁ scal year ended March 31, 2013 marked the 

15th anniversary since the launch of the Prius, 

Toyota’s initial foray into the hybrid market. During the 

ﬁ scal year under review, the Company broke through 

the 1,000,000 barrier in annual global vehicle sales 

for hybrid cars with cumulative sales exceeding 

5,000,000.

Source: Toyota Motor Corp.
Note: Market deﬁ nitions are as follows:
  Europe:   Germany, France, the United Kingdom, Italy, Spain, the Netherlands, 

Belgium, Portugal, Denmark, Greece, Ireland, Sweden, Austria, 
Finland, Switzerland, Norway, Poland, Hungary, and the Czech 
Republic
 Indonesia, Thailand, the Philippines, Malaysia, Singapore, Vietnam, 
Taiwan, South Korea, and Brunei Darussalam
  Mini-vehicles excluded

  Asia: 

  Japan: 

Consolidated Vehicle Sales
(Thousands of units)
10,000

8,000

6,000

7,352

2,071

4,000

1,872 

2,000

0

FY

798

1,327

1,284

’12

8,871

+1,519

2,279

+208

2,469

+597

799

1,684

+1

+357

1,640

+356

’13

Change

Japan
(Thousands of units)

(cid:2)(cid:2) Total market sales (excluding mini-vehicles)
(cid:3)(cid:3) Toyota market share

(%)
60

North America
(Thousands of units)
20,000

(cid:2)(cid:2) Total market sales
(cid:3)(cid:3) Toyota market share

4,000

3,000

2,000

1,000

0

FY

’09

’10

’11

’12

’13

Europe    
(Thousands of units)
25,000

(cid:2)(cid:2) Total market sales
(cid:3)(cid:3) Toyota market share

20,000

15,000

10,000

5,000

0

CY

’08

’09

’10

’11

’12

15,000

10,000

5,000

0

CY

’08

’09

’10

’11

’12

Asia
(Thousands of units)
10,000

(cid:2)(cid:2) Total market sales
(cid:3)(cid:3) Toyota market share

45

30

15

0

(%)
10

8

6

4

2

0

8,000

6,000

4,000

2,000

0

CY

Millions of yen

’08

’09

’10

’11

’12

2009

2010

2011

2012 

2013 

¥12,186,737  ¥11,220,303  ¥10,986,246  ¥11,167,319  ¥12,821,018 
6,284,425 
2,083,113 
4,385,476 
2,094,265 

4,751,886 
1,993,946 
3,334,274 
1,760,175 

5,429,136 
1,981,497 
3,374,534 
1,809,116 

6,222,914 
3,013,128 
2,719,329 
1,882,900 

5,670,526 
2,147,049 
2,655,327 
1,673,861 

(%)
40

30

20

10

0

(%)
25

20

15

10

5

0

% change

 2013 vs. 
2012 

+14.8 
+32.3 
 +4.5 
+31.5 
+19.0 

(4,416,093)

(4,586,841)

(4,423,947)

(5,604,105)

—

¥(225,242)
85,490 
(32,955)
203,527 
115,574 

¥(362,396)
339,503 
13,148 
312,977 
160,129 

¥(207,040)
186,409 
17,796 
256,790 
108,814 

¥576,335 
221,925 
26,462 
376,055 
133,744 

— 
+19.1 
+48.7 
+46.4 
+22.9 

For the years ended 
March 31
Net Revenues by Region:
  Japan
  North America
  Europe
  Asia
  Other*
Intersegment elimination/
  unallocated amount

(5,495,438)

Operating income (loss):
  Japan
  North America
  Europe
  Asia
  Other*
Intersegment elimination/
  unallocated amount

¥(237,531)
(390,192)
(143,233)
176,060 
87,648 

’09

’10

’11

’12

’13

 Japan　(cid:4) North America　(cid:4)  Europe　(cid:4) Asia　

(cid:4) Other*

46,237 

1,122 

4,918 

(7,142)

(13,633)

—

Note: Fiscal years ended March 31

* Central and South America, Oceania, Africa and the Middle East, etc.

 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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Next

 Automotive Operations   

 Financial Services Operations   

 Non-Automotive Business Operations

Financial Services Operations

handled by Toyota Financial Services Corporation 

Bangalore, Delhi, and Mumbai.

Toyota’s ﬁ nancial services operations are primarily 

expanded its business in such major cities as 

Toyota offers automotive ﬁ nancing and a variety 
of other ﬁ nancial services for total support of 
customer lifestyles.

In the ﬁ scal year ended March 31, 2013, net 

revenues from ﬁ nancial service operations 
amounted to ¥1,170.6 billion, up ¥70.3 billion, or 
6.4%, compared with the previous ﬁ scal year. 
From a proﬁ t perspective, operating income 
climbed ¥9.3 billion, or 3.1%, year on year to 
¥315.8 billion. This upswing in operating income 
was largely attributable to the increase in ﬁ nanc-
ing volume.

(TFS), which has overall control of ﬁ nancial services 

In such major markets as Europe and the United 

subsidiaries worldwide. TFS provides ﬁ nancial 

States, TFS aims to ensure stable earnings by work-

services primarily for vehicle purchases and leases to 

ing to secure margins and achieve thorough low-cost 

approximately 9.0 million customers in 34 countries 

operations with consideration for vehicle sales 

and regions worldwide.

support and the balancing of business risks.

  During the period under review, we continued with 

  To respond to dramatic changes in the business 

last year’s efforts to strengthen regional strategies by 

environment, TFS will strengthen groupwide compli-

enhancing our relationships with distributors through the 

ance and risk management structures while focusing 

provision of ﬁ nancial products and services meeting vari-

on enhancements to its business platform, such as IT 

ous national and regional customer characteristics.

platform development and human resource cultivation 

  TFS continued to broaden its connections with 

in management.

customers in Japan, responding to their needs by 

offering ready access to sound ﬁ nancial services 

such as credit cards and housing loans in addition to 

automotive ﬁ nancing.

  Overseas, the Company took proactive steps to 

develop business in emerging markets. After estab-

Total assets

Net revenues

Operating income

Overview  of  Toyota’s  Financial  Services  Operations

¥16,231.4 billion

¥1,170.6 billion

¥315.8 billion

34 countries and regions 
worldwide

lishing a local subsidiary in India in May 2011, 

Operating areas

 operations commenced in earnest from June 2012. 

In the ensuing period, TFS has successfully 

Number of employees

approx. 9,000

(As of March 31, 2013)

Net Revenues

(¥ Billion)
1,500

1,200

900

600

300

0

FY

’09

’10

’11

’12

’13

Operating Income

(¥ Billion)
400

Financial Services Operations Organization

Total Assets
(cid:2)(cid:2) Toyota (Consolidated)　(cid:2)(cid:2) TFS
(¥ Trillion)
35

300

200

100

0

-100

FY

’09

’10

’11

’12

’13

30

25

20

15

10

5

0

FY

’09

’10

’11

’12

’13

Note: Fiscal years ended March 31

Note: Fiscal years ended March 31

 
 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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Next

 Automotive Operations   

 Financial Services Operations   

 Non-Automotive Business Operations [1 of 3]

Non-Automotive Business Operations

Non-automotive business operations include 
Intelligent Transport Systems (ITS), information 
technology and telecommunications, e-TOYOTA, 
housing, marine, and biotechnology and affores-
tation businesses. In each of these operations we 
are fostering a workplace culture that encourages 
creativity and entrepreneurship. Also, we are 
seeking ideas for new businesses outside the 
Toyota group of companies as another key aspect 
in the creation of future core businesses.

In the ﬁ scal year under review, net revenues 
from non-automotive business operations were 
¥1,066.4 billion, ¥17.5 billion, or 1.7%, higher than 
the previous ﬁ scal year. Operating income also 
improved ¥11.5 billion, or 27.5%, year on year to 
¥53.6 billion.

Net Revenues

(¥ Billion)
1,200

1,000

800

600

400

200

0

FY

(cid:2) Intelligent Transport Systems

(cid:2)  Information Technology and 

Telecommunications

(cid:2) e-TOYOTA

Toyota is involved in the planning and development of 

Toyota dealers also serve as sales points for mobile 

Toyota is developing e-TOYOTA business operations 

products and services for Intelligent Transport 

phones and point-to-point telecommunications 

to facilitate the integration of IT services and automo-

Systems (ITS). We view this technology as a valuable 

services provided by KDDI Corporation at more than 

biles. We designed and developed the GAZOO 

way to link motor vehicles and transportation infra-

7,000 sales outlets (vehicle dealers, parts dealers, 

members-only automobile portal site, a three- 

structures, thereby contributing to sustainable 

rental ofﬁ ces, and L&F ofﬁ ces) throughout Japan.

dimensional virtual city called METAPOLIS and other 

economic development.

  Toyota is has also been engaged in the promotion 

services. In the ﬁ eld of telematics, we are developing 

In 2009, we helped create a practical vehicle-

of functions and services that link cars and mobile 

G-BOOK/G-Link, an information service for onboard 

infrastructure cooperative system for safe driving that 

phones, such as hands-free telephones and G-BOOK 

terminals, with other telematics services planned for 

prevents trafﬁ c accidents more effectively than 

services, and in 2012 launched the eCONNECT for 

China and other countries.

current safety technologies. In conjunction with this, 

the new Prius PHV and the Toyota Friend service. 

(cid:3) Read more

Toyota developed an onboard communications 

  Toyota’s information technology and telecommuni-

device, mainly for expressway use, compatible with 

cations business will come to play an even more 

the ITS Spot Service. Also, in 2011 Toyota commer-

important role as we develop smart grids that link 

cialized the Driving Safety Support System (DSSS), 

people, cars and homes.

’09

’10

’11

’12

’13

equipped with this device.

an onboard navigation system for public highways. 

We will continue to increase the number of models 

  Toyota is also engaging in R&D for vehicle infra-

structure cooperative systems, such as actively 

participating in public and private sector ﬁ eld trials, so 

as to bring them into use as soon as possible.

(cid:3) Read more

Operating Income

(¥ Billion)

60

50

40

30

20

10

0

-10

FY

’09

’10

’11

’12

’13

Note: Fiscal years ended March 31

TOPICS
New “Big Data Trafﬁ c Information Service”

Toyota developed the “Big Data Trafﬁ c Information Service,” 
a new kind of service utilizing big data that collects and 
stores trafﬁ c information via telematics services. Based on 
such data, trafﬁ c information, statistics, and other related 
information can be provided to local governments and busi-
nesses to aid trafﬁ c ﬂ ow improvement, provide map informa-
tion services, and assist disaster relief measures.
  At the same time, Toyota upgraded its existing “smart 
G-BOOK” telematics service for smartphones to allow private 
users access to “Big Data Trafﬁ c Information Service” content. 
The upgraded service features full support for a range of mobility 
options, from driving to walking, and features “T-Probe” trafﬁ c 
information (available for the ﬁ rst time on systems other than ofﬁ -
cial Toyota on-board navigation systems) that enables tailored 

route calculation taking trafﬁ c 
congestion into account.

In disaster situations, information on roads that remain 
open as well as evacuation sites, shelters, and other facilities 
can be accessed at any time free of charge. Moving forward, 
Toyota is committed to providing increasingly convenient 
total life services by promoting the widespread use of its “Big 
Data Trafﬁ c Information Service” as well as such linked 
services as the new “smart G-BOOK.” The Company is dedi-
cated to building safe communities while supporting infra-
structure that is resilient to disasters.

(cid:3) Read more

 
 
 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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Next

 Automotive Operations   

 Financial Services Operations   

 Non-Automotive Business Operations [2 of 3]

(cid:2) Housing

(cid:2) Marine

(cid:2)Biotechnology and Afforestation

Since Toyota entered the housing business in 1975, 

Toyota manufactures and sells pleasure boats, marine 

Toyota is making every effort to contribute to the 

Toyota Housing Corporation has expanded to provide 

engines and a variety of marine components. All 

creation of a resource recycling society through our 

homes under the name Toyota Home, offering high 

products take full advantage of our engine technolo-

afforestation activities, as well as our horticultural, 

durability and earthquake resistance, as well as excel-

gies and other advanced technologies cultivated 

environmental greening and agricultural biomass 

lent security, health and environmental features. 

during years of automotive manufacturing. The 

operations.

Toyota Housing Corporation offers environment-

PONAM-35, which was launched in September 

  Following previous afforestation and forestry devel-

friendly homes that conserve and create energy while 

2011, was voted Japan’s 2011 Boat of the Year, and 

opment projects in Australia and the Philippines, we 

having the durability to last for many years, and in 

won the 2011 Good Design Award.

are engaging in a forest restoration model project in 

November 2011, we began selling “smart houses,” 

(cid:3) Read more

comfortable and economical homes that combine 

Toyota technologies to link homes and cars. At the 

same time, Toyota is engaging in leading-edge devel-

opment in a variety of ﬁ elds, such as the operational 

testing of smart grids.

Note:  Effective October 1, 2010, all housing operation produc-

tion and technical development functions were trans-
ferred from Toyota Motor Corporation to Toyota Housing 
Corporation.

(cid:3) Read more

the town of Odaicho, located in Japan’s Mie 

Prefecture. In our Greeniﬁ cation Business, to counter-

act the urban heat-island phenomenon we offer 

Smart Green Parking, which provides greening in 

parking areas, and Smart Green Wall for wall green-

ing. We have established a sales subsidiary in China 

for this business. In our agricultural biomass opera-

tions, we added to our lineup of ResQ Series manure 

composting facility deodorizers.

(cid:3) Read more

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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

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Next

 Automotive Operations   

 Financial Services Operations   

 Non-Automotive Business Operations [3 of 3]

TOPICS
Promoting the Fun of Automobiles

Toyota is developing a range of activities to make cars more fun for dedicated motorsports fans as well as for a broader range of car enthusiasts.

Activities for dedicated motorsports fans

Activities for car fans and enthusiasts

Aimed at broadening the appeal of car racing and foster-
ing more car enthusiasts, Toyota is striving through 
GAZOO Racing* to make ever-better cars that satisfy 
drivers and promote the joy of cars in ways that tran-
scend the role of a typical car manufacturer.
  As a part of its unwavering commitment to making 
ever-better cars, every year Toyota participates in the 
ADAC 24h Rennen Nürburgring, a 24-hour endurance 
race in Germany. Employees take part both as drivers and 
mechanics. In addition to helping develop human 
resources well-versed in the making of cars, Toyota 
places considerable emphasis on promoting efforts aimed 
at commercializing models that deliver the fun of driving in 
the GRMN (GAZOO Racing tuned by MN) and G (G Sports) 
categories. Furthermore, in striving to promote the joy of 

cars, the Company holds circuit driving programs 
throughout Japan to allow individuals with no racing 
experience to easily enjoy the thrills of circuit driving in a 
safe environment. The TOYOTAGAZOO Racing FESTIVAL 
is one initiative that strives to broaden opportunities in 
which car fans and enthusiasts can interact.

*  A vehicle-development and motor-sports support program created 
by GAZOO for people to experience the fun of cars. GAZOO gives 
Toyota test drivers chances to race, and helps in our goal of 
making ever-better cars through vehicle development, while 
promoting the allure of cars through grassroots motor sports.

(cid:3) Read more

WEC
WEC

NASNASNASNASNAA CARCARCARCARARC RR
NASCAR

SUPER GT
SUPSUPSUPPPUPSUPEREREREREREREERE GTGTGTGTGTTG

SUPER FORMULA
SUPSUPSUPSUPUPPU ERERERERE FORFORFORORFOOOF MULMULMULMULUULLLAAAAAAA

In 2012, Toyota continued its ongoing involvement in the SUPER GT and SUPER 
FORMULA series in Japan as well as the NASCAR Nationwide Series of races in the United 
States. At the same time, the Company not only participated in the FIA World Endurance 
Championship for hybrid vehicles, it won several of the series’ races. Toyota has thus had 
the opportunity to provide enjoyment and excitement to a great many people. In 2013, the 
Company will work diligently to provide even more opportunities for people to enjoy the 
world of racing.

(cid:3) Read more

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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 R&D and Intellectual Property [1 of 2]   

 Corporate Philosophy   

 Corporate Governance   

 Management Team   

 Risk Factors

Next

R&D and Intellectual Property

Toyota R&D is dedicated to the development of 

attractive, affordable, high-quality products for 

customers worldwide. The intellectual property 

that R&D generates is a vital management 

resource that Toyota utilizes and protects to 

maximize its corporate value.

R&D Guiding Principles
(cid:2)  Providing clean and safe products and 

(cid:2) R&D Activities
The overriding goal of Toyota’s technology and product 

3.7% of consolidated net revenues. We worked 

closely with suppliers to develop components and 

(cid:2) R&D Organization
Toyota operates a global R&D organization with the 

development activities is to minimize the negative aspects 

products more efﬁ ciently and took steps to reduce our 

primary goal of building automobiles that precisely meet 

of driving, such as trafﬁ c accidents and the burden that 

automobiles have on the environment, and maximize the 

positive aspects, such as driving pleasure, comfort, and 

convenience. By achieving these sometimes conﬂ icting 

goals to a high degree, we want to open the door to the 

automobile society of the future.

own R&D expenses. At the same time, we plan to 

continue making substantial investments in R&D 

involving forward-looking, leading-edge technologies 

and the development of products associated with the 

environment, energy, and safety. These investments 

are essential to preserving our competitive edge in 

  To ensure efﬁ cient progress in R&D activities, we 

terms of technologies and products.

the needs of customers in every region of the world.

In Japan, R&D operations are led by Toyota Central 

Research & Development Laboratories, Inc., which works 

closely with Daihatsu Motor Co., Ltd., Hino Motors, Ltd., 

Toyota Auto Body Co., Ltd., Toyota Motor East Japan, 

Inc., and many other Toyota Group companies. Overseas, 

we have a worldwide network of technical centers as well 

coordinate and integrate all phases, from basic 

(cid:3) Read more about “History of Technological Development”

as design and motorsports R&D centers.

research to forward-looking technology and product 

enhancing the quality of life of people every-

development. With respect to such basic research 

issues as energy, the environment, information tech-

(cid:2) Domestic and Overseas R&D Bases
Activities
Facility Name 

Location

where through all our activities.

(cid:2)  Pursuing advanced technological develop-

ment in a wide range of ﬁ elds, we pledge to 

provide attractive products and services that 

respond to the needs of customers worldwide.

R&D Expenses

(¥ Billion)
1,000

800

600

400

200

0

FY

nology, telecommunications, and materials, projects 

Japan

are regularly reviewed and evaluated in consultation 

with outside experts to achieve efﬁ cient R&D cost 

control.

  And with respect to forward-looking, leading-edge 

technology and product development, we establish 

cost-performance benchmarks on a project-by-project 

basis to ensure efﬁ cient development investment.

Head Ofﬁ ce Toyota Technical Center

Higashi-Fuji Technical Center
Tokyo Design Research & Laboratory
Shibetsu Proving Ground
Toyota Central Research & Development 
Laboratories, Inc.

Product Planning, Design, Vehicle 
Engineering and Evaluation
Advanced Engineering
Research of Advanced Styling Designs
Vehicle Testing and Evaluation

Toyota City, Aichi Prefecture

Susono City, Shizuoka Prefecture
Hachioji City, Tokyo
Shibetsu City, Hokkaido

Basic Research

Nagakute City, Aichi Prefecture

Basic research

Technological 
breakthroughs 
related to 
components 
and systems

Product 
development

Development theme discovery
Research on basic vehicle-related technology
Forward-looking and leading-edge 
  technology development

Head Ofﬁ ce 
Toyota Technical Center

Higashi-Fuji 
Technical Center

Tokyo Design 
Research & Laboratory

Shibetsu Proving Ground

Toyota Central 
Research & Development 
Laboratories, Inc.

Development of leading-edge components 
  and systems ahead of competitors

Facility Name 

USA

Activities

Location

Primary responsibility for new model 
  development
Development of all-new models and 
  existing-model upgrades

Toyota Motor Engineering & Manufacturing 
North America, Inc.

Product Planning, Vehicle Engineering and 
Evaluation, Basic Research

Michigan, California, Arizona, Washington DC

Calty Design Research, Inc. 

Design

Newport Beach, California
Ann Arbor, Michigan

’09

’10

’11

’12

’13

up 3.5% from the previous ﬁ scal year, representing 

Toyota Motor Engineering & 
Manufacturing North America, Inc.

Calty Design Research, Inc.

(cid:2) R&D Expenditures
In ﬁ scal 2013, R&D expenses totaled ¥807.4 billion, 

 
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R&D and Intellectual Property

Facility Name 

Europe

Toyota Motor Europe NV/SA
Toyota Europe Design Development

Toyota Motorsport GmbH (TMG)

Vehicle Engineering and Evaluation
Design
Development for Motorsport Vehicles, 
Advanced Engineering

Brussels, Belgium; Derby, U.K.
Nice, France

Cologne, Germany

Activities

Location

(cid:2) Intellectual Property

(cid:2) Intellectual Property Strategies
Toyota carefully analyzes patents and the need for 

Intellectual Property Guiding Principle

patents in each area of research to formulate more 

(cid:2)  Securing greater corporate ﬂ exibility and 

maximizing corporate value through the 

appropriate acquisition and utilization of 

intellectual property.

(cid:2) Intellectual Property Activities
Toyota’s competitiveness springs from the forward-

effective R&D strategies. We identify R&D projects in 

which Toyota should acquire patents, and ﬁ le relevant 

applications as necessary to help build a strong global 

patent portfolio. In addition, we want to contribute to 

sustainable mobility by promoting the spread of tech-

nologies with environmental and safety beneﬁ ts. This 

is why we take an open stance to patent licensing and 

grant licenses when appropriate terms are met. 

looking R&D stance that is instrumental to core 

A good example of this policy is the licensing to other 

strengths associated with products and technologies. 

companies of patents in the area of hybrid technology, 

Underlying each new product that emerges from R&D, 

which is one of our core technologies involving envi-

there are always intellectual properties such as inven-

ronmental energy.

tions and expertise that we value as important 

management resources.

(cid:2) Intellectual Property Systems
R&D and intellectual property activities are organiza-

tionally linked to enable us to focus on selected devel-

opment themes and build a strong patent portfolio. 

We have established an Intellectual Property 

Committee made up of individuals involved with 

management, R&D, and intellectual property. This 

committee acquires and utilizes important intellectual 

property that contributes to business operations and 

helps determine policies for management risks associ-

ated with intellectual property.

Toyota Motor Europe NV/SA

Toyota Europe Design Development

Toyota Motorsport GmbH (TMG)

Facility Name 

China

Activities

Location

Toyota Motor Engineering and Manufacturing (China) 
Co., Ltd.
Tianjin FAW Toyota Motor Co., Ltd. FAW Toyota R&D 
Center
GAC Toyota Motor Co., Ltd. R&D Center

Basic Research, Technical Research 
and Vehicle Evaluation

Jiangsu

Vehicle Engineering and Evaluation

Tianjin

Vehicle Engineering and Evaluation

Guangdong

Toyota Motor Engineering and 
Manufacturing (China) Co., Ltd.

FAW Toyota Research & Development 
Co., Ltd.

GAC Toyota Motor Co., Ltd. R&D Center

Facility Name 

Asia Paciﬁ c

Activities

Location

Toyota Motor Asia Paciﬁ c Engineering and 
Manufacturing Co., Ltd.
Toyota Technical Center Asia Paciﬁ c Australia Pty., Ltd.

Vehicle Engineering and Evaluation

Samutprakarn Province, Thailand

Vehicle Engineering and Evaluation

Melbourne, Australia

Toyota Motor Asia Paciﬁ c Engineering 
and Manufacturing Co., Ltd.

Toyota Technical Center Asia Paciﬁ c 
Australia Pty., Ltd.

(cid:3) See Domestic and Overseas R&D Bases

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(cid:4)  Seeking Harmony between People, Society and the Global Environment, and Sustainable Development of 

Society through Manufacturing

(cid:4)  The Spirit of the Toyoda Precepts, Passed down since Toyota’s Founding

Since its foundation, Toyota has continuously strived 

energy. The pillars of our social contribution are “envi-

The Toyoda Precepts represent the essential philosophy of the founder of the Toyota group of companies, Sakichi 

to contribute to the sustainable development of soci-

ronment,” “trafﬁ c safety,” and “human resources 

Toyoda, and are a source of spiritual support for Toyota employees.

ety through the manufacturing and provision of innova-

development.” Toyota seeks to be of value to commu-

tive, high-quality products and services that lead the 

nities and to society through our main lines of busi-

times. The automobile is a wonderful machine that 

ness, and to bring smiles to people’s faces. Toyota’s 

provides freedom of movement. Nevertheless, auto-

basic Corporate Social Responsibility (CSR) policy is 

The Toyoda Precepts

• Always be faithful to your duties, thereby contributing to the company and to the overall good.

mobiles have an impact on the environment and soci-

to contribute to the sustainable development of soci-

• Always be studious and creative, striving to stay ahead of the times.

ety. This is something we at Toyota always keep in 

ety. This phrase embodies the spirit of the Toyota 

mind, and we try to create harmony among people, 

Guiding Principles, and clariﬁ es our CSR stance for 

societies and the environment by listening to what our 

our stakeholders, both within and outside the 

customers and local communities have to say. Our 

company. Toyota subsidiaries and suppliers share this 

operations are aimed at creating a sustainable society 

CSR policy, and we expect them to adhere to the spirit 

through monozukuri (conscientious manufacturing). 

of the policy in their operations.

• Always be practical and avoid frivolousness.

• Always strive to build a homelike atmosphere at work that is warm and friendly.

• Always have respect for spiritual matters, and remember to be grateful at all times.

Toyota develops and produces environment-friendly 

  Toyota also participated in the formulation of the 

vehicles such as hybrid vehicles, and we also offer 

Charter of Corporate Behavior of the Nippon 

(cid:4)  Toyota Guiding Principles

superior accident prevention and collision safety 

Keidanren (Japan Business Federation), which is an 

The Toyota Guiding Principles (adopted in 1992 and revised in 1997) reﬂ ect the kind of company that Toyota seeks to 

features. In addition, Toyota is involved in new busi-

alliance of Japanese leading corporations, and 

be in light of the unique management philosophy, values, and methods that it has embraced since its foundation. 

nesses, such as biotech, afforestation and renewable 

observes the standards outlined therein.

Toyota, along with its consolidated subsidiaries, seeks to contribute to the continuous development of human society 

and of the planet through its businesses based on understanding and sharing the Toyota Guiding Principles.

Positioning of the CSR Policy

Overview of Toyota’s CSR Activities

1
0
0
2

y
a
W
a
t
o
y
o
T

1.  Honor the language and spirit of the law of every nation and undertake open and fair business activities 

to be a good corporate citizen of the world.

2.  Respect the culture and customs of every nation and contribute to economic and social development 

Safety

Environment

through corporate activities in their respective communities.

3.  Dedicate our business to providing clean and safe products and to enhancing the quality of life every-

Social 
Aspect

Environmental 
Aspect

where through all of our activities.

Comfort 
and 
Convenience

Economic 
Aspect 

Resources/
Energy
Sources

4.  Create and develop advanced technologies and provide outstanding products and services that fulﬁ ll 

the needs of customers worldwide.

5.  Foster a corporate culture that enhances both individual creativity and the value of teamwork, while 

honoring mutual trust and respect between labor and management.

6. Pursue growth through harmony with the global community via innovative management.

7.  Work with business partners in research and manufacture to achieve stable, long-term growth and 

mutual beneﬁ ts, while keeping ourselves open to new partnerships.

     Toyota’s Social Contribution Activities

     Societal Issues

(cid:3) Read more

 
 
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(cid:4) Toyota’s Basic Policy on Corporate Governance

(cid:4) Corporate Governance System

  Additionally, in order to achieve sustainable growth 

  Toyota has an “International Advisory Board” 

through the continuous development of even-better 

consisting of advisors from each region overseas, and, 

cars that exceed customer expectations around the 

as appropriate, receives advice on a wide range of 

Toyota has positioned the stable long-term growth of 

In March 2011, Toyota announced the “Toyota Global 

world, and realize the Toyota Global Vision, the TNGA 

management issues from a global perspective. In 

corporate value as a top-priority management issue. 

Vision” and commenced “Visionary Management.” 

Planning Division, an organization directly under 

addition, the Company has a wide variety of confer-

We believe that in carrying this out, it is essential that 

This is based on values that have guided Toyota since 

Toyota’s top management, was established in order to 

ences and committees for deliberations and the moni-

we achieve long-term and stable growth by building 

its founding, such as the “Guiding Principles at Toyota” 

rapidly promote the implementation of the “Toyota 

toring of management and corporate activities that 

positive relationships with all stakeholders, including 

and the “Toyota Way,” which aim to exceed customer 

New Global Architecture (TNGA).”

reﬂ ect the views of various stakeholders, including the 

“Labor-Management Council, the Joint Labor-

Management Round Table Conference,” and the 

“Toyota Environment Committee.” In order to manage 

and implement important activities for fulﬁ lling social 

responsibilities, TMC has established the “CSR 

Committee,” at the core consisting of directors at the 

executive vice president level and above as well as 

representatives of the Audit & Supervisory Board.

shareholders and customers as well as business part-

expectations by the development of ever-better cars 

ners, local communities, and employees, and by 

and enriching the lives of societies, and to be 

supplying products that will satisfy our customers. This 

rewarded with a smile that ultimately leads to a stable 

position is reﬂ ected in the “Guiding Principles at 

base of business.

(cid:4) Management Transparency

Toyota,” which is a statement of Toyota’s fundamental 

  Toyota’s current management structure is based on 

business policies. Also, Toyota adopted and presented 

the structure introduced in April 2011. In order to fulﬁ ll 

the CSR Policy “Contribution towards Sustainable 

the Toyota Global Vision, Toyota reduced the Board of 

Development,” an interpretation of the “Guiding 

Directors and decision-making layers, and has 

With respect to our system regarding directors, we 

believe that it is important to elect individuals that 

comprehend and engage in our strengths, including 

commitment to manufacturing, with an emphasis on 

Principles at Toyota” that organizes the relationships 

endeavored to swiftly communicate the views of 

front-line operations and problem solving based on the 

with its stakeholders. We are working to enhance 

customers and information from operations on-ground 

actual on-site situation (genchi genbutsu). At the 

corporate governance through a variety of measures 

to management and facilitate rapid management deci-

designed to further increase our competitiveness as a 

sion making.

109th Ordinary General Shareholders’ Meeting held in 

June 2013, three Outside Directors were appointed in 

global company.

In April 2013, Toyota made organizational changes 

order to further reﬂ ect the opinions of those from 

  We believe it is important to put in place a system 

with the aim of further increasing the speed of decision 

outside the Company in management’s decision-

that enables customer opinions and on-site informa-

making by clarifying responsibilities for operations and 

making process. While Toyota currently does not have 

tion to be swiftly communicated to management in 

earnings, speciﬁ cally by dividing the automotive busi-

its own standard or policy on independence in 

order to make a prompt management decision, and 

ness into the following four units—Lexus International 

enables us to review whether such management deci-

(Lexus business); Toyota No. 1 (North America, Europe 

sions are accepted by our customers and society. We 

and Japan); Toyota No. 2 (China, Asia & the Middle 

appointing Outside Directors, the Company believes 

that such appointments are appropriate since various 

rules on independence, such as stock exchange regu-

believe that our current system, involving the supervi-

East, East Asia & Oceania; Africa, Latin America & the 

lations, are used as references in making such 

sion and auditing of the execution of business by our 

Caribbean); and Unit Center (engine, transmission, 

appointments. We believe our Outside Directors will 

Board of Directors (including Outside Directors) and 

and other “unit”-related operations)—and an Executive 

advise us in our management decision-making 

Audit & Supervisory Board Members (including 

Vice President was put in charge of the operations of 

process based on their broad experience and insight 

Outside Audit & Supervisory Board Members), is the 

each unit in order to realize organizational change that 

in their respective ﬁ elds of expertise.

most appropriate system for us.

supports operations and earnings responsibility.

 
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(cid:4) Compliance

Toyota currently does not have its own standard or 

policy on independence in appointing Outside Audit & 

Supervisory Board Members, the Company believes 

(cid:4) Accountability

 extraordinary committee meetings from time to time 

whenever necessary.

The CSR Committee reviews important issues relating 

that such appointments are appropriate since various 

Toyota has engaged in timely and fair disclosure of 

to corporate ethics, legal compliance, risk manage-

rules on independence, such as stock exchange regu-

corporate and ﬁ nancial information as stated in the 

(cid:4)  Basic Policy Regarding the System to Secure

the Appropriateness of Business

ment, and social contribution and also develops action 

lations, are used as references in making such 

CSR Policy “Contribution towards Sustainable 

plans concerning these issues. In addition, Toyota has 

appointments. The state of internal controls and inter-

Development.” In order to ensure the accurate, fair, 

Toyota, together with its subsidiaries, has created and 

created a number of facilities for employees to make 

nal audits are reported to Audit & Supervisory Board 

and timely disclosure of information, Toyota has estab-

maintained a sound corporate climate based on the 

inquiries concerning compliance matters, including the 

Members (including Outside Audit & Supervisory 

lished the Disclosure Committee chaired by an ofﬁ cer 

“Guiding Principles at Toyota” and the “Toyota Code of 

Compliance Hotline, which enables them to consult 

Board Members) through the Audit & Supervisory 

of the Accounting Division. The Committee holds 

Conduct.” Toyota integrates the principles of problem 

with an outside attorney, and takes measures to 

Board and the “CSR Committee,” and the status of 

regular meetings for the purpose of preparing, report-

identiﬁ cation and continuous improvement into its 

ensure that Toyota is aware of signiﬁ cant information 

accounting audits is reported by independent External 

ing, and assessing its annual securities report, quar-

business operation process and makes continuous 

concerning legal compliance as quickly as possible. 

Auditors to the Audit & Supervisory Board Members 

terly report under the Financial Instruments and 

efforts to train employees who will put these principles 

Toyota will continue to promote the “Toyota Code of 

(including Outside Audit & Supervisory Board 

Exchange Law of Japan, and Form 20-F under the 

into practice.

Conduct” which is a guideline for the behavior and 

Members) through the Audit & Supervisory Board. To 

U.S. Securities Exchange Act, and also holds 

conduct of employees of Toyota and its consolidated 

enhance the system for internal audits, a specialized 

subsidiaries (together “Toyota”) all around the world. 

organization made  independent of direct control by 

Toyota’s Corporate Governance

Emphasizing Front-line Operations + 
Multidirectional Monitoring

Toyota will work to advance corporate ethics through 

the management evaluates the effectiveness of the 

training and education at all levels and in all departments.

system to secure the appropriateness of documents 

  Toyota has adopted an auditor system. Seven Audit 

regarding ﬁ nancial calculation and other information in 

& Supervisory Board Members (including four Outside 

accordance with Section 404 of the U.S. Sarbanes-

Audit & Supervisory Board Members) play a role in 

Oxley Act and Article 24-4-4 (1) of the Financial 

Toyota’s corporate governance efforts by undertaking 

Instruments and Exchange Law of Japan. In order to 

audits in accordance with the audit policies and plans 

enhance the reliability of the ﬁ nancial reporting of 

determined by the Audit & Supervisory Board. In 

Toyota, the three auditing functions—audit by Audit & 

 addition, Toyota has secured the personnel and frame-

Supervisory Board Members, internal audit, and 

work supporting the audit by Audit & Supervisory 

accounting audit by Independent External Auditors—

Board Members. The Outside Audit & Supervisory 

aid in conducting an effective and efﬁ cient audit 

Board Members advise Toyota from a fair and neutral 

through meetings held periodically and as necessary 

perspective, based on their broad experience and 

to share information and come to understanding 

insight in their respective ﬁ elds of expertise. While 

through discussion on audit plans and results.

(cid:3) Read more

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Management Team (As of June 14, 2013)
Board of Directors

Chairman of the Board

President, Member of the Board

Executive Vice President, Member of the Board

Takeshi Uchiyamada
’69   Joined Toyota Motor Corporation 

(“TMC”)
’98  Director
’01  Managing Director
’03 
 Senior Managing Director
’05   Executive Vice President
’12   Vice Chairman

Executive Vice President, Member of the Board

Mitsuhisa Kato
’75  Joined TMC
’04  Managing Ofﬁ cer 
’06  Advisor 
’10  Senior Managing Director 
’11  Senior Managing Ofﬁ cer
’12  Executive Vice President 

Akio Toyoda
’84  Joined TMC
’00  Director 
’02  Managing Director 
’03  Senior Managing Director 
’05  Executive Vice President 
’09  President 

Masamoto Maekawa
’73  Joined Toyota Motor Sales Co., Ltd.
’03  Managing Ofﬁ cer of TMC
’07   President of Toyota Administa 

Corporation
’07  Advisor to TMC
’09 Senior Managing Director
’11  Senior Managing Ofﬁ cer 
’12  Executive Vice President 

Satoshi Ozawa
’74  Joined Toyota Motor Sales Co., Ltd.
’03  Managing Ofﬁ cer 
’07  Senior Managing Director 
’10  Executive Vice President 

Yasumori Ihara
’75  Joined Toyota Motor Sales Co., Ltd.
’04  Managing Ofﬁ cer 
’07  Advisor 
’09  Senior Managing Director 
’11   Director and Senior Managing Ofﬁ cer 

Nobuyori Kodaira
’72   Joined Ministry of International Trade 

and Industry

’04   Director-General, Agency for Natural 

Resources and Energy
’06   Retired from the same
’08   Advisor to TMC
’09  Managing Ofﬁ cer 
’10  Senior Managing Director 
’11   Director and Senior Managing Ofﬁ cer 
’12  Executive Vice President 

Seiichi Sudo
’74  Joined TMC
’03  Managing Ofﬁ cer 
’08  Advisor 
’12  Senior Managing Ofﬁ cer 

Member of the Board

Senior Managing Ofﬁ cer, Member of the Board

Senior Managing Ofﬁ cer, Member of the Board

Senior Managing Ofﬁ cer, Member of the Board

Mamoru Furuhashi
’73  Joined TMC
’03  Managing Ofﬁ cer 
’07  Senior Managing Director 
’11   Director and Senior Managing Ofﬁ cer 

Kiyotaka Ise
’80  Joined TMC
’07  Managing Ofﬁ cer 
’13  Senior Managing Ofﬁ cer 

Koei Saga
’77  Joined TMC
’08  Managing Ofﬁ cer 
’12  Senior Managing Ofﬁ cer 

Shigeki Terashi
’80  Joined TMC
’08  Managing Ofﬁ cer 
’13  Senior Managing Ofﬁ cer 

Member of the Board

Member of the Board

Member of the Board

Member of the Board

Yoshimasa Ishii
’76  Joined Toyota Motor Sales Co., Ltd.
’05  Managing Ofﬁ cer of TMC
’09  Senior Managing Director
’11  Senior Managing Ofﬁ cer

Ikuo Uno*
’59  Joined Nippon Life Insurance Company
’97   President and Representative Director 

of the same

’05   Chairman and Representative Director 

of the same

’11   Advisor to the same

Haruhiko Kato*
’75  Joined Ministry of Finance (Japan)
’09   Director-General of National Tax 

Administration Agency

’11   President and CEO of Japan Securities 

Depository Center, Inc.

Mark. T. Hogan*
’73  Joined General Motors Corporation
’02   Vice President of General Motors 

Group

’04  President of Magna International Inc.
’08   President and CEO of The Vehicle 

Production Group LLC

’10  President of Dewey Investments LLC

* Outside Director

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Management Team (As of June 14, 2013)
Outside Audit & Supervisory Board Members

Full-Time Audit & Supervisory Board Member

Yoichiro Ichimaru
’71  Joined Toyota Motor Sales Co., Ltd.
’01  Director of TMC
’03  Managing Ofﬁ cer 
’05  Senior Managing Director 
’09  Executive Vice President 
’11   Audit & Supervisory Board Member 

Masaki Nakatsugawa
’76  Joined Toyota Motor Sales Co., Ltd.
’06   Audit & Supervisory Board Member 

of TMC

Masahiro Kato
’75  Joined TMC
’09  Managing Ofﬁ cer 
’11   Audit & Supervisory Board Member 

Outside Audit & Supervisory Board Member

Yoichi Morishita
’57   Joined Matsushita Electric Industrial 

Co., Ltd.

’93  President of the same
’00  Chairman of the same
’06   Outside Audit & Supervisory Board 

Member of TMC

’06   Executive Advisor to Matsushita 
Electric Industrial Co., Ltd.
’12   Special Corporate Advisor to 
Panasonic Corporation

Akishige Okada
’63  Joined Mitsui Bank, Ltd.
’97  President of Sakura Bank, Ltd.
’01   Chairman of Sumitomo Mitsui Banking 

Corporation

’02   Chairman of Sumitomo Mitsui Financial 

Group Inc.

’05   Special Advisor to Sumitomo Mitsui 

Banking Corporation

’06   Outside Audit & Supervisory Board 

Member of TMC

’10   Honorary Advisor to Sumitomo Mitsui 

Banking Corporation

Kunihiro Matsuo
’68   Prosecutor of Tokyo District Public 

Prosecutors Ofﬁ ce

’04   Prosecutor General of Supreme Public 

Prosecutors Ofﬁ ce
’06  Registered as attorney
’07   Outside Audit & Supervisory Board 

Member of TMC

Yoko Wake
’70  Joined The Fuji Bank, Limited
’93   Professor of Faculty of Business and 

Commerce of Keio University
’11   Outside Audit & Supervisory Board 

Member of TMC

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Operational and other risks faced by Toyota that 

fuel economy, the amount of time required for innova-

consumer spending. However, in Europe, the 

customer demand with respect to quality, safety and 

could signiﬁ cantly inﬂ uence the decisions of inves-

tion and development, pricing, customer service and 

economic environment continues to remain stagnant 

reliability. The timely introduction of new vehicle 

tors are set out below. However, the following 

ﬁ nancing terms. Increased competition may lead to 

due to the ongoing sovereign debt crisis, and the rate 

models, at competitive prices, meeting rapidly chang-

does not encompass all risks related to the opera-

lower vehicle unit sales, which may result in a further 

of economic growth is slowing down in emerging 

ing customer preferences and demand is more funda-

tions of Toyota. There are risk factors other than 

downward price pressure and adversely affect 

economies. Such shifts in demand for automobiles is 

mental to Toyota’s success than ever, as the 

those given below. Any such risk factors could 

Toyota’s ﬁ nancial condition and results of operations. 

continuing, and it is unclear how this situation will tran-

automotive market is rapidly transforming in light of the 

inﬂ uence the decisions of investors. The forward-

Toyota’s ability to adequately respond to the recent 

sition in the future. Toyota’s ﬁ nancial condition and 

changing global economy. There is no assurance, 

looking statements included below are based on 

rapid changes in the automotive market and to main-

results of operations may be adversely affected if the 

however, that Toyota will adequately and appropriately 

information available as of June 24, 2013, the ﬁ ling 

tain its competitiveness will be fundamental to its 

shifts in demand for automobiles continues or 

respond to changing customer preferences and 

date of Form 20-F.

future success in existing and new markets and to 

progresses further. Demand may also be affected by 

demand with respect to quality, safety, reliability, styling 

(cid:4) Industry and Business Risks 

maintain its market share. There can be no assurances 

factors directly impacting vehicle price or the cost of 

and other features in a timely manner. Even if Toyota 

that Toyota will be able to compete successfully in 

purchasing and operating vehicles such as sales and 

succeeds in perceiving customer preferences and 

the future. 

ﬁ nancing incentives, prices of raw materials and parts 

demand, there is no assurance that Toyota will be 

and components, cost of fuel and governmental regu-

capable of developing and manufacturing new, price 

The worldwide automotive market is 

The worldwide automotive industry is highly volatile. 

lations (including tariffs, import regulation and other 

competitive products in a timely manner with its avail-

highly competitive. 

Each of the markets in which Toyota competes has 

taxes). Volatility in demand may lead to lower vehicle 

able technology, intellectual property, sources of raw 

The worldwide automotive market is highly competi-

been subject to considerable volatility in demand. 

unit sales, which may result in downward price pres-

materials and parts and components, and production 

tive. Toyota faces intense competition from automotive 

Demand for vehicles depends to a large extent on 

sure and adversely affect Toyota’s ﬁ nancial condition 

capacity, including cost reduction capacity. Further, 

manufacturers in the markets in which it operates. 

social, political and economic conditions in a given 

and results of operations. 

there is no assurance that Toyota will be able to imple-

Although the global economy is gradually recovering, 

market and the introduction of new vehicles and tech-

ment capital expenditures at the level and times 

competition in the automotive industry has further 

nologies. As Toyota’s revenues are derived from sales 

Toyota’s future success depends on its ability to 

planned by management. Toyota’s inability to develop 

intensiﬁ ed amidst difﬁ cult overall market conditions. In 

in markets worldwide, economic conditions in such 

offer new innovative competitively priced products 

and offer products that meet customers’ preferences 

addition, competition is likely to further intensify in light 

markets are particularly important to Toyota. In Japan, 

that meet customer demand on a timely basis. 

and demand with respect to quality, safety, reliability, 

of further continuing globalization in the worldwide 

while there continues to be some signs of weakness, 

Meeting customer demand by introducing attractive 

styling and other features in a timely manner could 

automotive industry, possibly resulting in further indus-

the economic environment is gradually recovering. In 

new vehicles and reducing the amount of time 

result in a lower market share and reduced sales 

try reorganization. Factors affecting competition 

the United States, economic conditions are moder-

required for product development are critical to auto-

volumes and margins, and may adversely affect 

include product quality and features, safety, reliability, 

ately recovering due to factors such as increased 

motive manufacturers. In particular, it is critical to meet 

Toyota’s ﬁ nancial condition and results of operations.

 
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P a g e  40

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

Risk Factors

 R&D and Intellectual Property   

 Corporate Philosophy   

 Corporate Governance   

 Management Team   

 Risk Factors [2 of 3]

Next

Toyota’s ability to market and distribute effectively 

may decrease, adversely affecting its ﬁ nancial condi-

Toyota’s production and deliveries, which could have 

various digital and information technologies, including 

is an integral part of Toyota’s successful sales. 

tion and results of operations. 

an adverse effect on Toyota’s ﬁ nancial condition and 

information service and driving assistance functions. 

Toyota’s success in the sale of vehicles depends on its 

results of operations. 

Despite security measures, Toyota’s digital and infor-

ability to market and distribute effectively based on 

Toyota relies on suppliers for the provision of 

mation technology networks and systems may be 

distribution networks and sales techniques tailored to 

certain supplies including parts, components and 

The worldwide ﬁ nancial services industry is highly 

vulnerable to damage, disruptions or shutdowns due 

the needs of its customers. There is no assurance that 

raw materials. 

competitive. 

to attacks by hackers, computer viruses, breaches 

Toyota will be able to develop sales techniques and 

Toyota purchases supplies including parts, compo-

The worldwide ﬁ nancial services industry is highly 

due to unauthorized use, errors or malfeasance by 

distribution networks that effectively adapt to changing 

nents and raw materials from a number of external 

competitive. Increased competition in automobile 

employees and others who have or gain access to the 

customer preferences or changes in the regulatory 

suppliers located around the world. For some 

ﬁ nancing may lead to decreased margins. A decline in 

networks and systems Toyota depends on, service 

environment in the major markets in which it operates. 

supplies, Toyota relies on a single supplier or a limited 

Toyota’s vehicle unit sales, an increase in residual 

failures or bankruptcy of third parties such as software 

Toyota’s inability to maintain well-developed sales 

number of suppliers, whose replacement with another 

value risk due to lower used vehicle price, an increase 

development or cloud computing vendors, power 

techniques and distribution networks may result in 

supplier may be difﬁ cult. Inability to obtain supplies 

in the ratio of credit losses and increased funding 

shortages and outages, and utility failures or other 

decreased sales and market share and may adversely 

from a single or limited source supplier may result in 

costs are factors which may impact Toyota’s ﬁ nancial 

catastrophic events like natural disasters. Such 

affect its ﬁ nancial condition and results of operations. 

difﬁ culty obtaining supplies and may restrict Toyota’s 

services operations. If Toyota is unable to adequately 

 incidents could materially disrupt critical operations, 

ability to produce vehicles. Furthermore, even if Toyota 

respond to the changes and competition in automo-

disclose sensitive data, interfere with information 

Toyota’s success is signiﬁ cantly impacted by its 

were to rely on a large number of suppliers, ﬁ rst-tier 

bile ﬁ nancing, Toyota’s ﬁ nancial services operations 

services and driving assistance functions in Toyota’s 

ability to maintain and develop its brand image. 

suppliers with whom Toyota directly transacts may in 

may adversely affect its ﬁ nancial condition and results 

vehicles, and/or give rise to legal claims or proceed-

In the highly competitive automotive industry, it is criti-

turn rely on a single second-tier supplier or limited 

of operations. 

ings, liability or regulatory penalties under applicable 

cal to maintain and develop a brand image. In order to 

second-tier suppliers. Toyota’s ability to continue to 

laws, which could have an adverse effect on Toyota’s 

maintain and develop a brand image, it is necessary to 

obtain supplies from its suppliers in a timely and cost-

Toyota’s operations and vehicles rely on various 

brand image and its ﬁ nancial condition and results 

further increase customers’ conﬁ dence by providing 

effective manner is subject to a number of factors, 

digital and information technologies. 

of operations. 

safe, high-quality products that meet customer prefer-

some of which are not within Toyota’s control. These 

Toyota depends on various information technology 

ences and demand. If Toyota is unable to effectively 

factors include the ability of Toyota’s suppliers to 

networks and systems, some of which are managed 

(cid:4) Financial Market and Economic Risks

maintain and develop its brand image as a result of its 

provide a continued source of supply, and Toyota’s 

by third parties, to process, transmit and store elec-

inability to provide safe, high-quality products or as a 

ability to effectively compete and obtain competitive 

tronic information, including sensitive data, and to 

Toyota’s operations are subject to currency and 

result of the failure to promptly implement safety 

prices from suppliers. A loss of any single or limited 

manage or support a variety of business processes 

interest rate ﬂ uctuations. 

measures such as recalls when necessary, vehicle unit 

source supplier or inability to obtain supplies from 

and activities, including manufacturing, research and 

Toyota is sensitive to ﬂ uctuations in foreign currency 

sales and/or sale prices may decrease, and as a result 

suppliers in a timely and cost-effective manner could 

development, supply chain management, sales and 

exchange rates and is principally exposed to ﬂ uctua-

revenues and proﬁ ts may not increase as expected or 

lead to increased costs or delays or suspensions in 

accounting. In addition, Toyota’s vehicles may rely on 

tions in the value of the Japanese yen, the U.S. dollar 

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P a g e  41

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

Risk Factors

 R&D and Intellectual Property   

 Corporate Philosophy   

 Corporate Governance   

 Management Team   

 Risk Factors [3 of 3]

Next

and the euro and, to a lesser extent, the Australian 

metals, non-ferrous alloys including aluminum, and 

such as Toyota are required to implement safety 

legal proceedings brought by its shareholders and 

dollar, the Russian ruble, the Canadian dollar and the 

plastic parts, may lead to higher production costs for 

measures such as recalls for vehicles that do not or 

governmental proceedings and investigations. Toyota 

British pound. Toyota’s consolidated ﬁ nancial state-

parts and components. This could, in turn, negatively 

may not comply with the safety standards of laws and 

is in fact currently subject to a number of pending legal 

ments, which are presented in Japanese yen, are 

impact Toyota’s future proﬁ tability because Toyota may 

governmental regulations. In addition, Toyota may, in 

proceedings and government investigations. A nega-

affected by foreign currency exchange ﬂ uctuations 

not be able to pass all those costs on to its customers 

order to reassure its customers of the safety of 

tive outcome in one or more of these pending legal 

through translation risk, and changes in foreign 

or require its suppliers to absorb such costs. 

Toyota’s vehicles, decide to voluntarily implement 

proceedings could adversely affect Toyota’s ﬁ nancial 

currency exchange rates may also affect the price of 

recalls or other safety measures even if the vehicle 

condition and results of operations. 

products sold and materials purchased by Toyota in 

The downturn in the ﬁ nancial markets could 

complies with the safety standards of relevant laws 

foreign currencies through transaction risk. In particu-

adversely affect Toyota’s ability to raise capital. 

and governmental regulations. Many governments 

Toyota may be adversely affected by natural 

lar, strengthening of the Japanese yen against the U.S. 

Should the world economy suddenly deteriorate, a 

also impose tariffs and other trade barriers, taxes and 

calamities, political and economic instability, fuel 

dollar can have an adverse effect on Toyota’s 

number of ﬁ nancial institutions and investors will face 

levies, or enact price or exchange controls. Toyota has 

shortages or interruptions in social infrastructure, 

 operating results. 

difﬁ culties in providing capital to the ﬁ nancial markets at 

incurred, and expects to incur in the future, signiﬁ cant 

wars, terrorism and labor strikes. 

  Toyota believes that its use of certain derivative 

levels corresponding to their own ﬁ nancial capacity, 

costs in complying with these regulations. If Toyota 

Toyota is subject to various risks associated with 

ﬁ nancial instruments including foreign exchange 

and, as a result, there is a risk that companies may not 

launches products that result in safety measures such 

conducting business worldwide. These risks include 

forward contracts and interest rate swaps and 

be able to raise capital under terms that they would 

as recalls, Toyota may incur various costs including 

natural calamities; political and economic instability; 

increased localized production of its products have 

expect to receive with their creditworthiness. If Toyota is 

signiﬁ cant costs for free repairs. Furthermore, new 

fuel shortages; interruption in social infrastructure 

reduced, but not eliminated, the effects of interest rate 

unable to raise the necessary capital under appropriate 

legislation or changes in existing legislation may also 

including energy supply, transportation systems, gas, 

and foreign currency exchange rate ﬂ uctuations. 

conditions on a timely basis, Toyota’s ﬁ nancial condition 

subject Toyota to additional expenses in the future. If 

water, or communication systems resulting from natu-

Nonetheless, a negative impact resulting from ﬂ uctua-

and results of operations may be adversely affected. 

Toyota incurs signiﬁ cant costs related to implementing 

ral hazards or technological hazards; wars; terrorism; 

tions in foreign currency exchange rates and changes 

in interest rates may adversely affect Toyota’s ﬁ nancial 

condition and results of operations. 

(cid:4) Political, Regulatory, Legal and Other Risks 

safety measures or meeting laws and governmental 

labor strikes; and work stoppages. Should the major 

regulations, Toyota’s ﬁ nancial condition and results of 

markets in which Toyota purchases materials, parts 

operations may be adversely affected. 

and components and supplies for the manufacture of 

The automotive industry is subject to various 

Toyota products or in which Toyota’s products are 

High prices of raw materials and strong pressure 

governmental regulations. 

Toyota may become subject to various legal 

produced, distributed or sold be affected by any of 

on Toyota’s suppliers could negatively impact 

The worldwide automotive industry is subject to vari-

proceedings. 

these events, it may result in disruptions and delays in 

Toyota’s proﬁ tability. 

ous laws and governmental regulations including 

As an automotive manufacturer, Toyota may become 

the operations of Toyota’s business. Should signiﬁ cant 

Increases in prices for raw materials that Toyota and 

those related to vehicle safety and environmental 

subject to legal proceedings in respect of various 

or prolonged disruptions or delays related to Toyota’s 

Toyota’s suppliers use in manufacturing their products 

matters such as emission levels, fuel economy, noise 

issues, including product liability and infringement of 

business operations occur, it may adversely affect 

or parts and components such as steel, precious 

and pollution. In particular, automotive manufacturers 

intellectual property. Toyota may also be subject to 

Toyota’s ﬁ nancial condition and results of operations. 

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P a g e  42

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

Next

 Selected Financial Summary (U.S. GAAP) [1 of 2]   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Report of Independent Registered Public Accounting Firm

 Consolidated Quarterly Financial Summary   

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Selected Financial Summary (U.S. GAAP)

Toyota Motor Corporation
Fiscal years ended March 31

For the Year:
  Net Revenues:

  Sales of Products
  Financing Operations

  Total

  Costs and Expenses:

  Cost of Products Sold
  Cost of Financing Operations
  Selling, General and Administrative

  Total

  Operating Income (Loss)
  % of Net Revenues
Income (Loss) before Income Taxes and Equity in Earnings of Afﬁ liated Companies

  Provision for Income Taxes
  Net Income (Loss) Attributable to Toyota Motor Corporation
  ROE
  Net Cash Provided by Operating Activities
  Net Cash Used in Investing Activities
  Net Cash Provided by (Used in) Financing Activities
  R&D Expenses
  Capital Expenditures for Property, Plant and Equipment*
  Depreciation
At Year-End:
  Toyota Motor Corporation Shareholders’ Equity
  Total Assets
  Long-Term Debt
  Cash and Cash Equivalents
  Ratio of Toyota Motor Corporation Shareholders’ Equity

Per Share Data:
  Net Income (Loss) Attributable to Toyota Motor Corporation (Basic)
  Annual Cash Dividends
  Toyota Motor Corporation Shareholders’ Equity
Stock Information (March 31):
  Stock Price
  Market Capitalization (Yen in millions)
  Number of Shares Issued (shares)

* Excluding vehicles and equipment of operating leases

2004

2005

¥16,578,033
716,727
¥17,294,760

¥13,506,337
364,177
1,757,356
¥15,627,870
¥  1,666,890
9.6%
1,765,793
681,304
1,162,098
15.2%
¥  2,186,734
(2,216,495)
242,223
682,279
945,803
969,904

¥  8,178,567
22,040,228
4,247,266
1,729,776
37.1%

¥17,790,862
760,664
¥18,551,526

¥14,500,282
369,844
2,009,213
¥16,879,339
¥  1,672,187
9.0%
1,754,637
657,910
1,171,260
13.6%
¥  2,370,940
(3,061,196)
419,384
755,147
1,068,287
997,713

¥  9,044,950
24,335,011
5,014,925
1,483,753
37.2%

2004

2005

¥       342.90
45
2,456.08

¥         3,880
¥14,006,790
3,609,997,492

¥       355.35
65
2,767.67

¥         3,990
¥14,403,890
3,609,997,492

Yen in millions
2006

¥20,059,493
977,416
¥21,036,909

¥16,335,312
609,632
2,213,623
¥19,158,567
¥  1,878,342
8.9%
2,087,360
795,153
1,372,180
14.0%
¥  2,515,480
(3,375,500)
876,911
812,648
1,523,459
1,211,178

¥10,560,449
28,731,595
5,640,490
1,569,387
36.8%

Yen
2006

¥       421.76
90
3,257.63

¥         6,430
¥23,212,284
3,609,997,492

2007

2008

¥22,670,097
1,277,994
¥23,948,091

¥18,356,255
872,138
2,481,015
¥21,709,408
¥  2,238,683
9.3%
2,382,516
898,312
1,644,032
14.7%
¥  3,238,173
(3,814,378)
881,768
890,782
1,425,814
1,382,594

¥11,836,092
32,574,779
6,263,585
1,900,379
36.3%

¥24,820,510
1,468,730
¥26,289,240

¥20,452,338
1,068,015
2,498,512
¥24,018,865
¥  2,270,375
8.6%
2,437,222
911,495
1,717,879
14.5%
¥  2,981,624
(3,874,886)
706,189
958,882
1,480,570
1,491,135

¥11,869,527
32,458,320
5,981,931
1,628,547
36.6%

2007

2008

¥       512.09
120
3,701.17

¥         7,550
¥27,255,481
3,609,997,492

¥       540.65
140
3,768.97

¥         4,970
¥17,136,548
3,447,997,492

 
 
 
 
 
 
 
 
 
 
 
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Contents

P a g e  43

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

Next

 Selected Financial Summary (U.S. GAAP) [2 of 2]   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Report of Independent Registered Public Accounting Firm

 Consolidated Quarterly Financial Summary   

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Selected Financial Summary (U.S. GAAP)

Toyota Motor Corporation
Fiscal years ended March 31

For the Year:
  Net Revenues:

  Sales of Products
  Financing Operations

  Total

  Costs and Expenses:

  Cost of Products Sold
  Cost of Financing Operations
  Selling, General and Administrative

  Total

  Operating Income (Loss)
  % of Net Revenues
Income (Loss) before Income Taxes and Equity in Earnings of Afﬁ liated Companies

  Provision for Income Taxes
  Net Income (Loss) Attributable to Toyota Motor Corporation
  ROE
  Net Cash Provided by Operating Activities
  Net Cash Used in Investing Activities
  Net Cash Provided by (Used in) Financing Activities
  R&D Expenses
  Capital Expenditures for Property, Plant and Equipment*
  Depreciation
At Year-End:
  Toyota Motor Corporation Shareholders’ Equity
  Total Assets
  Long-Term Debt
  Cash and Cash Equivalents
  Ratio of Toyota Motor Corporation Shareholders’ Equity

Per Share Data:
  Net Income (Loss) Attributable to Toyota Motor Corporation (Basic)
  Annual Cash Dividends
  Toyota Motor Corporation Shareholders’ Equity
Stock Information (March 31):
  Stock Price
  Market Capitalization (Yen in millions)
  Number of Shares Issued (shares)

* Excluding vehicles and equipment of operating leases

2009

2010

Yen in millions
2011

2012

2013

% change
2013 vs. 2012

¥19,173,720
1,355,850
¥20,529,570

¥17,468,416
987,384
2,534,781
¥20,990,581
¥    (461,011)
-2.2%
(560,381)
(56,442)
(436,937)
-4.0%
¥  1,476,905
(1,230,220)
698,841
904,075
1,364,582
1,495,170

¥10,061,207
29,062,037
6,301,469
2,444,280
34.6%

¥17,724,729
1,226,244
¥18,950,973

¥15,971,496
712,301
2,119,660
¥18,803,457
¥     147,516
0.8%
291,468
92,664
209,456
2.1%
¥  2,558,530
(2,850,184)
(277,982)
725,345
604,536
1,414,569

¥10,359,723
30,349,287
7,015,409
1,865,746
34.1%

2009

2010

¥      (139.13)
100
3,208.41

¥         3,120
¥10,757,752
3,447,997,492

¥         66.79
45
3,303.49

¥         3,745
¥12,912,751
3,447,997,492

¥17,820,520
1,173,168
¥18,993,688

¥15,985,783
629,543
1,910,083
¥18,525,409
¥     468,279
2.5%
563,290
312,821
408,183
3.9%
¥  2,024,009
(2,116,344)
434,327
730,340
629,326
1,175,573

¥10,332,371
29,818,166
6,449,220
2,080,709
34.7%

Yen
2011

¥       130.17
50
3,295.08

¥         3,350
¥11,550,792
3,447,997,492

¥17,511,916
1,071,737
¥18,583,653

¥15,795,918
592,646
1,839,462
¥18,228,026
¥     355,627
1.9%
432,873
262,272
283,559
2.7%
¥  1,452,435
(1,442,658)
(355,347)
779,806
723,537
1,067,830

¥10,550,261
30,650,965
6,042,277
1,679,200
34.4%

¥20,914,150 
1,150,042 
¥22,064,192 

¥18,010,569 
630,426 
2,102,309 
¥20,743,304 
¥  1,320,888 
6.0%
1,403,649 
551,686 
962,163 
8.5%
¥  2,451,316 
(3,027,312)
477,242 
807,454 
854,561
1,105,109 

¥12,148,035 
35,483,317 
7,337,824 
1,718,297 
34.2%

2012

2013

¥         90.21
50
3,331.51

¥         3,570
¥12,309,351
3,447,997,492

¥       303.82
90
3,835.30

¥         4,860
¥16,757,268 
3,447,997,492 

+19.4 
+7.3 
+18.7 

+14.0 
+6.4 
+14.3 
+13.8 
+271.4 
—
+224.3 
+110.3 
+239.3 
—
+68.8 
—
—
+3.5 
+18.1 
+3.5 

+15.1 
+15.8 
+21.4 
+2.3 
—

% change
2013 vs. 2012

+236.8 
+80.0
+15.1 

+36.1
+36.1 
—

 
 
 
 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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Contents

P a g e  44

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Consolidated Segment Information

Toyota Motor Corporation
Fiscal years ended March 31

Business Segment:
  Net Revenues:
  Automotive
  Financial Services
  All Other

Intersegment Elimination
  Consolidated

  Operating Income (Loss):

  Automotive
  Financial Services
  All Other

Intersegment Elimination
  Consolidated
Geographic Information:
  Net Revenues:

  Japan
  North America
  Europe
  Asia
  Other

Intersegment Elimination
  Consolidated

  Operating Income (Loss):

  Japan
  North America
  Europe
  Asia
  Other

Intersegment Elimination
  Consolidated

2008

2009

2010

2011

2012

2013

Yen in millions

% change
2013 vs. 2012

¥24,177,306
1,498,354
1,346,955
(733,375)
¥26,289,240

¥  2,171,905
86,494
33,080
(21,104)
¥  2,270,375

¥15,315,812
9,423,258
3,993,434
3,120,826
2,294,137
(7,858,227)
¥26,289,240

¥  1,440,286
305,352 
141,571
256,356
143,978
(17,168)
¥  2,270,375

¥18,564,723
1,377,548
1,184,947
(597,648)
¥20,529,570

¥    (394,876)
(71,947)
9,913
(4,101)
¥    (461,011)

¥12,186,737
6,222,914
3,013,128
2,719,329
1,882,900
(5,495,438)
¥20,529,570

¥    (237,531)
(390,192)
(143,233)
176,060
87,648
46,237 
¥    (461,011)

¥17,197,428
1,245,407
947,615
(439,477)
¥18,950,973

¥      (86,370)
246,927
(8,860)
(4,181)
¥     147,516

¥11,220,303
5,670,526
2,147,049
2,655,327
1,673,861
(4,416,093)
¥18,950,973

¥    (225,242)
85,490 
(32,955)
203,527
115,574
1,122 
¥     147,516

¥17,337,320
1,192,205
972,252
(508,089)
¥18,993,688

¥       85,973
358,280
35,242
(11,216)
¥     468,279 

¥10,986,246
5,429,136
1,981,497
3,374,534
1,809,116
(4,586,841)
¥18,993,688

¥    (362,396)
339,503 
13,148
312,977
160,129
4,918 
¥     468,279

 ¥16,994,546
1,100,324
1,048,915
(560,132)
¥18,583,653

¥       21,683
306,438
42,062
(14,556)
¥     355,627

¥11,167,319
4,751,886
1,993,946
3,334,274
1,760,175
(4,423,947)
¥18,583,653

¥    (207,040) 
186,409 
17,796
256,790
108,814
(7,142)
¥     355,627

 ¥20,419,100
1,170,670
1,066,461
(592,039)
¥22,064,192

¥     944,704
315,820
53,616
6,748
¥  1,320,888

¥12,821,018
6,284,425
2,083,113
4,385,476
2,094,265
(5,604,105)
¥22,064,192

¥     576,335
221,925 
26,462
376,055
133,744
(13,633)
¥  1,320,888

+20.2
+6.4
+1.7
—
+18.7

+4,256.9
+3.1
+27.5
—
+271.4

+14.8
+32.3
+4.5
+31.5 
+19.0 
—
+18.7 

—
+19.1 
+48.7 
+46.4
+22.9
—
+271.4

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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Contents

P a g e  45

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Consolidated Quarterly Financial Summary

Toyota Motor Corporation
Fiscal years ended March 31

Net Revenues
  % Change
Operating Income (Loss)
  % Change
  Operating Income Margin
Income (Loss) before Income Taxes and Equity in Earnings of Afﬁ liated Companies
  % Change
Net Income Attributable to Toyota Motor Corporation
  % Change
Business Segment:
  Net Revenues:
  Automotive
  Financial Services
  All Other

Intersegment Elimination
  Consolidated

  Operating Income (Loss):

  Automotive
  Financial Services
  All Other

Intersegment Elimination
  Consolidated
Geographic Information:
  Net Revenues:

  Japan
  North America
  Europe
  Asia
  Other

Intersegment Elimination
  Consolidated

  Operating Income (Loss):

  Japan
  North America
  Europe
  Asia
  Other

Intersegment Elimination
  Consolidated

2012

2013

Yen in billions

First Quarter
¥3,441.0
-29.4%
(108.0)
—%
-3.1%
(80.5)
—%
1.1
-99.4%

¥3,060.8
285.8
190.5
(96.1)
¥3,441.0

¥  (202.5)
94.6
(2.0)
1.9 
¥  (108.0)

¥1,784.5
853.5
459.9
700.0
368.8
(725.7)
¥3,441.0

¥  (206.6)
28.9
(7.5)
60.1
21.0
(3.9)
¥  (108.0)

Second Quarter
¥4,574.9
-4.8%
75.4 
-32.4%
1.6%
79.1 
-38.7%
80.4
-18.5%

¥4,183.1
271.0
255.2
(134.4)
¥4,574.9

¥      (7.5)
76.4
9.9 
(3.4)
¥     75.4

¥2,869.0
1,085.7
499.2
827.3
455.3
(1,161.6)
¥4,574.9

¥    (69.3)
32.5
5.6 
70.4
37.1
(0.9)
¥     75.4

Third Quarter
 ¥4,865.2
4.1%
149.6 
51.1%
3.1%
198.6 
53.2%
80.9
-13.5%

¥4,471.4
271.5
272.2
(149.9)
 ¥4,865.2

¥     57.1
83.5
15.3 
(6.3)
¥   149.6

¥3,024.2
1,379.5
527.0
704.2
460.2
(1,229.9)
¥4,865.2

¥    (30.5)
90.3
10.4 
40.5
37.9
1.0 
¥   149.6

Fourth Quarter
¥5,702.5
22.8%
238.5 
417.5%
4.2%
235.6 
467.2%
121.0
376.5%

First Quarter
¥5,501.5
59.9%
353.1 
—%
6.4%
415.2 
—%
290.3 
24,929.9%

Second Quarter
¥5,406.7
18.2%
340.6 
351.8%
6.3%
379.3 
379.4%
257.9 
220.7%

¥5,279.0
272.0
331.0
(179.6)
¥5,702.5

¥   174.5
51.9
18.8 
(6.7)
 ¥   238.5

¥3,489.6
1,432.9
507.8
1,102.9
475.9
(1,306.7)
¥5,702.5

¥     99.4
34.5
9.2 
85.7
12.8
(3.3)
¥   238.5

¥5,120.1
274.4 
243.2 
(136.2)
¥5,501.5

¥   258.6 
86.7 
9.3 
(1.6)
¥   353.1 

¥3,242.2 
1,592.8 
512.0 
1,073.6 
483.4 
(1,402.7)
¥5,501.5 

¥   107.1 
117.6 
3.4 
101.5 
27.1 
(3.7)
¥   353.1 

¥5,008.7
272.0 
252.6 
(126.6)
¥5,406.7

¥   239.3 
87.7 
13.1 
0.3 
¥   340.6 

¥3,163.9 
1,450.9 
497.5 
1,088.2 
500.8 
(1,294.8)
¥5,406.7 

¥   143.7 
64.9 
8.6 
92.9 
31.5 
(1.2)
¥   340.6 

Third Quarter
 ¥5,318.7
9.3%
124.7 
-16.7%
2.3%
131.2 
-33.9%
99.9 
23.4%

¥4,889.2
301.3 
262.0 
(133.8)
¥5,318.7

¥     43.7 
69.0 
15.4 
(3.4)
¥   124.7 

¥2,976.2 
1,525.0 
508.3 
1,112.5 
530.3 
(1,333.8)
¥5,318.7 

¥     15.6 
(17.1)
9.2 
91.7 
32.3 
(7.1)
¥   124.7 

Fourth Quarter
¥5,837.0
2.4%
502.3 
110.6%
8.6%
477.8 
102.8%
313.9 
159.4%

¥5,401.0
322.8 
308.4 
(195.2)
¥5,837.0

¥   402.9 
72.2 
15.7 
11.4 
¥   502.3 

¥3,438.5 
1,715.6 
565.1 
1,110.9 
579.5 
(1,572.7)
¥5,837.0 

¥   309.8 
56.4 
5.1 
89.7 
42.6 
(1.4)
¥   502.3 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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Contents

P a g e  46

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [1 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

All ﬁ nancial information discussed in this section is derived from Toyota’s consolidated 

Consolidated Vehicle Sales

ﬁ nancial statements that appear elsewhere in this annual report. The ﬁ nancial statements 

have been prepared in conformity with generally accepted accounting principles in the 

(Thousands of units)
10,000

United States of America.

Overview

The business segments of Toyota include auto-

affected by a number of factors including social, 

motive operations, ﬁ nancial services operations 

political and general economic conditions; introduc-

8,000

6,000

4,000

2,000

0

  Toyota’s share of total vehicle unit sales in each 

market is inﬂ uenced by the quality, safety, reliability, 

price, design, performance, economy and utility of 

Toyota’s vehicles compared with those offered by 

other manufacturers. The timely introduction of new 

or redesigned vehicles is also an important factor in 

satisfying customer needs. Toyota’s ability to satisfy 

changing customer preferences can affect its reve-

nues and earnings signiﬁ cantly.

  The proﬁ tability of Toyota’s automotive operations 

and all other operations. Automotive operations 

tion of new vehicles and technologies; and costs 

FY

’09

’10

’11

’12

’13

is affected by many factors. These factors include:

are Toyota’s most signiﬁ cant business segment, 

incurred by customers to purchase or operate vehi-

  (cid:129) vehicle unit sales volumes,

accounting for 90% of Toyota’s total revenues 

cles. These factors can cause consumer demand to 

  During ﬁ scal 2013 and 2012, Toyota’s consolidat-

  (cid:129) the mix of vehicle models and options sold,

before the elimination of intersegment revenues for 

vary substantially in different geographic markets 

ed vehicle unit sales in Japan increased as com-

  (cid:129) the level of parts and service sales,

ﬁ scal 2013. Toyota’s primary markets based on 

and for different types of automobiles.

pared with each prior ﬁ scal year, primarily as a result 

  (cid:129)  the levels of price discounts and other sales 

vehicle unit sales for ﬁ scal 2013 were: Japan (26%), 

  For the automobile industry, markets have pro-

of the active introduction of new products and the 

incentives and marketing costs,

North America (28%), Europe (9%) and Asia (19%).

gressed in a steady manner, especially in the U.S. 

efforts of dealers nationwide. Toyota and Lexus 

  (cid:129)   the cost of customer warranty claims and other 

  Automotive Market Environment

for products with advanced green technology has 

48.4% for ﬁ scal 2013, representing a record high, 

  (cid:129)   the cost of research and development and 

The worldwide automotive market is highly competi-

remained strong throughout all markets worldwide.

and market share (including Daihatsu and Hino 

other ﬁ xed costs,

and emerging countries such as Asia. The demand 

brands’ market share excluding mini-vehicles was 

customer satisfaction actions,

tive and volatile. The demand for automobiles is 

brands) including mini-vehicles remained at a high 

  (cid:129)   the prices of raw materials,

level of 44.3% following the prior ﬁ scal year. Overseas 

  (cid:129)   the ability to control costs,

consolidated vehicle unit sales decreased during 

  (cid:129)   the efﬁ cient use of production capacity,

  The following table sets forth Toyota’s consolidated vehicle unit sales by geographic market based on loca-

 ﬁ scal 2012, whereas they increased during ﬁ scal 

  (cid:129)   the adverse effect on production due to the 

tion of customers for the past three ﬁ scal years.

2013. During ﬁ scal 2012, total overseas vehicle unit 

reliance on various suppliers for the provision 

Japan
North America
Europe
Asia
Other*
Overseas total
  Total

Thousands of units
Years Ended March 31,
2012
2,071
1,872
798
1,327
1,284
5,281
7,352

2013
2,279
2,469
799
1,684
1,640
6,592
8,871

2011
1,913
2,031
796
1,255
1,313
5,395
7,308

sales decreased, particularly in North America due 

of supplies,

to impact of the Great East Japan Earthquake and 

  (cid:129)   the adverse effect on market, sales and pro-

the ﬂ ood in Thailand, although an increase in Asia 

ductions of natural calamities and interruptions 

resulted from steady demand in spite of the ﬂ ood in 

of social infrastructure, and

Thailand. During ﬁ scal 2013, total overseas vehicle 

  (cid:129)   changes in the value of the Japanese yen and 

unit sales increased in every region.

other currencies in which Toyota conducts 

business.

* “Other” consists of Central and South America, Oceania, Africa and the Middle East, etc.

 
 
ANNUAL REPORT 2013

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P a g e  47

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [2 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

  Changes in laws, regulations, policies and other 

2009, Toyota announced a safety campaign in 

trend in the automotive markets. As competition 

governmental actions can also materially impact the 

North America for certain models of Toyota and 

increases, margins on ﬁ nancing transactions may 

proﬁ tability of Toyota’s automotive operations. 

Lexus brands’ vehicles related to ﬂ oor mat entrap-

decrease and market share may also decline as 

These laws, regulations and policies include those 

ment of accelerator pedals, and later expanded it to 

customers obtain ﬁ nancing for Toyota vehicles from 

attributed to environmental matters, vehicle safety, 

include additional models. In January 2010, Toyota 

alternative sources.

fuel economy and emissions that can add signiﬁ -

announced a recall in North America for certain 

  Toyota’s ﬁ nancial services operations mainly 

cantly to the cost of vehicles. The European Union 

models of Toyota vehicles related to sticking and 

include loans and leasing programs for customers 

has enforced a directive that requires manufacturers 

slow-to-return accelerator pedals. Also in January 

and dealers. Toyota believes that its ability to pro-

to be ﬁ nancially responsible for taking back end-of-

2010, Toyota recalled in Europe and China certain 

vide ﬁ nancing to its customers is an important value 

life vehicles and to take measures to ensure that 

models of Toyota vehicles related to sticking accel-

added service. Therefore, Toyota has expanded its 

adequate used vehicle disposal facilities are estab-

erator pedals. In February 2010, Toyota announced 

network of ﬁ nance subsidiaries in order to offer 

lished and those hazardous materials and recycla-

a recall in markets including Japan, North America 

ﬁ nancial services in many countries.

ble parts are removed from vehicles prior to 

and Europe related to the braking control system in 

  Toyota’s competitors for retail ﬁ nancing and retail 

scrapping. See “Legislation Regarding End-of-Life 

certain vehicle models including the Prius. The 

leasing include commercial banks, credit unions 

Vehicles”, “Information on the Company—Business 

recalls and other safety measures described above 

and other ﬁ nance companies. Meanwhile, commer-

Overview—Governmental Regulation, 

have led to a number of claims, lawsuits and gov-

cial banks and other captive automobile ﬁ nance 

Environmental and Safety Standards” in Toyota’s 

ernment investigations against Toyota in the United 

companies also compete against Toyota’s whole-

annual report on Form 20-F and note 23 to the con-

States. For a more detailed description of these 

sale ﬁ nancing activities.

solidated ﬁ nancial statements for a more detailed 

claims, lawsuits and government investigations, see 

  Toyota’s total ﬁ nance receivables increased dur-

discussion of these laws, regulations and policies.

note 23 to the consolidated ﬁ nancial statements.

ing ﬁ scal 2013 mainly due to the favorable impact of 

  Many governments also regulate local content, 

  The worldwide automotive industry is in a period 

ﬂ uctuations in foreign currency translation rates and 

impose tariffs and other trade barriers, and enact 

of global competition which may continue for the 

an increase in the retail receivables.

price or exchange controls that can limit an auto-

foreseeable future, and in general the competitive 

maker’s operations and can make the repatriation of 

environment in which Toyota operates is likely to 

Total Assets by Financial Services Operations 

proﬁ ts unpredictable. Changes in these laws, regu-

intensify. Toyota believes it has the resources, strat-

lations, policies and other governmental actions 

egies and technologies in place to compete effec-

may affect the production, licensing, distribution or 

tively in the industry as an independent company for 

sale of Toyota’s products, cost of products or appli-

the foreseeable future.

cable tax rates. From time-to-time when potential 

safety problems arise, Toyota issues vehicle recalls 

  Financial Services Operations

and takes other safety measures including safety 

The competition of worldwide automobile ﬁ nancial 

campaigns with respect to its vehicles. In November 

services industry is intensifying despite the recovery 

(¥ Billion)
20,000

15,000

10,000

5,000

0

FY

’09

’10

’11

’12

’13

ANNUAL REPORT 2013

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Contents

P a g e  48

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [3 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

  The following table provides information regarding Toyota’s ﬁ nance receivables and operating leases in the 

  Toyota enters into interest rate swap agreements 

receivables at March 31, 2013 increased by ¥30.5 

past two ﬁ scal years.

and cross currency interest rate swap agreements 

billion from March 31, 2012 to ¥338.1 billion.

Finance Receivables
Retail
Finance leases
Wholesale and other dealer loans

Deferred origination costs
Unearned income
Allowance for credit losses
  Retail
  Finance leases
  Wholesale and other dealer loans 

  Total ﬁ nance receivables, net 
Less—Current portion
  Noncurrent ﬁ nance receivables, net
Operating Leases
Vehicles
Equipment 
Less—Deferred income and other 

Less—Accumulated depreciation
Less—Allowance for credit losses 
  Vehicles and equipment on operating leases, net

Yen in millions
March 31, 

2012 

2013 

¥  7,248,793
955,430
2,033,954
10,238,177
105,533
(494,123)

(77,353)
(30,637)
(24,238)
(132,228)
9,717,359
(4,114,897)
¥  5,602,462

¥  2,536,595
 87,848
(49,090)
2,575,353
(667,406)
(8,135)
¥  1,899,812 

¥  9,047,782
1,029,887
2,615,728
12,693,397
135,398
(628,340)

(83,858)
(28,928)
(26,243)
(139,029)
12,061,426
(5,117,660)
¥  6,943,766

¥  2,999,294
104,351
(65,634)
3,038,011
(749,238)
(8,020)
¥  2,280,753

to convert its ﬁ xed-rate debt to variable-rate func-

tional currency debt. A portion of the derivative 

  Other Business Operations

instruments are entered into to hedge interest rate 

Toyota’s other business operations consist of hous-

risk from an economic perspective and are not des-

ing including the manufacture and sale of prefabri-

ignated as a hedge of speciﬁ c assets or liabilities on 

cated homes, information technology related 

Toyota’s consolidated balance sheet and according-

businesses including information technology and 

ly, unrealized gains or losses related to derivatives 

telecommunications, intelligent transport systems 

that are not designated as a hedge are recognized 

and GAZOO, and other businesses.

currently in operations. See discussion in “Critical 

  Toyota does not expect its other business opera-

Accounting Estimates—Derivatives and Other 

tions to materially contribute to Toyota’s consolidat-

Contracts at Fair Value” and “Quantitative and 

ed results of operations.

Qualitative Disclosures about Market Risk” and 

notes 20 and 26 to the consolidated ﬁ nancial 

  Currency Fluctuations

statements.

Toyota is affected by ﬂ uctuations in foreign currency 

  The ﬂ uctuations in funding costs can affect the 

exchange rates. Toyota is exposed to ﬂ uctuations in 

proﬁ tability of Toyota’s ﬁ nancial services operations. 

the value of the Japanese yen against the U.S. dollar 

Funding costs are affected by a number of factors, 

and the euro and, to a lesser extent, the Australian 

some of which are not in Toyota’s control. These 

dollar, the Russian ruble, the Canadian dollar, the 

factors include general economic conditions, pre-

British pound, and others. Toyota’s consolidated 

vailing interest rates and Toyota’s ﬁ nancial strength. 

ﬁ nancial statements, which are presented in 

Funding costs decreased during ﬁ scal 2012 and 

Japanese yen, are affected by foreign currency 

2013, mainly as a result of lower interest rates.

exchange ﬂ uctuations through both translation risk 

  Toyota launched its credit card business in Japan 

and transaction risk.

  Toyota’s ﬁ nance receivables are subject to col-

  Toyota continues to originate leases to ﬁ nance new 

in April 2001. As of March 31, 2012, Toyota had 

  Translation risk is the risk that Toyota’s consoli-

lectability risks. These risks include consumer and 

Toyota vehicles. These leasing activities are subject 

10.9 million cardholders, an increase of 2.0 million 

dated ﬁ nancial statements for a particular period or 

dealer insolvencies and insufﬁ cient collateral values 

to residual value risk. Residual value losses could be 

cardholders compared with March 31, 2011. As of 

for a particular date will be affected by changes in 

(less costs to sell) to realize the full carrying values 

incurred when the lessee of a vehicle does not exer-

March 31, 2013, Toyota had 11.8 million cardhold-

the prevailing exchange rates of the currencies in 

of these receivables. See discussion in “Critical 

cise the option to purchase the vehicle at the end of 

ers, an increase of 0.9 million cardholders compared 

those countries in which Toyota does business 

Accounting Estimates—Allowance for Doubtful 

the lease term. See discussion in “Critical Accounting 

with March 31, 2012. The credit card receivables at 

compared with the Japanese yen. Even though the 

Accounts and Credit Losses” and note 11 to the 

Estimates—Investment in Operating Leases” and 

March 31, 2012 increased by ¥44.0 billion from 

ﬂ uctuations of currency exchange rates to the 

consolidated ﬁ nancial statements.

note 2 to the consolidated ﬁ nancial statements.

March 31, 2011 to ¥307.5 billion. The credit card 

Japanese yen can be substantial, and, therefore, 

ANNUAL REPORT 2013

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Contents

P a g e  49

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [4 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

signiﬁ cantly impact comparisons with prior periods 

can be signiﬁ cant. See notes 20 and 26 to the consoli-

in the previous ﬁ scal year to the local currency-

automotive operations as a global competitor in the 

and among the various geographic markets, the 

dated ﬁ nancial statements for additional information.

denominated net revenues for ﬁ scal 2012 and 

worldwide automotive market. Management allo-

translation risk is a reporting consideration and does 

  Generally, a weakening of the Japanese yen 

2013, respectively, as if the value of the Japanese 

cates resources to, and assesses the performance 

not reﬂ ect Toyota’s underlying results of operations. 

against other currencies has a positive effect on 

yen had remained constant for the comparable 

of, its automotive operations as a single business 

Toyota does not hedge against translation risk.

Toyota’s revenues, operating income and net 

periods. Results excluding the impact of currency 

segment on a worldwide basis. Toyota does not 

  Transaction risk is the risk that the currency struc-

income attributable to Toyota Motor Corporation. 

ﬂ uctuations year-on-year are not on the same basis 

manage any subset of its automotive operations, 

ture of Toyota’s costs and liabilities will deviate from 

A strengthening of the Japanese yen against other 

as Toyota’s consolidated ﬁ nancial statements and 

such as domestic or overseas operations or parts, 

the currency structure of sales proceeds and assets. 

currencies has the opposite effect. Although, in ﬁ s-

do not conform with U.S. GAAP. Furthermore, 

as separate management units.

Transaction risk relates primarily to sales proceeds 

cal 2012, the Japanese yen was on average and at 

Toyota does not believe that these measures are a 

  The management of the automotive operations is 

from Toyota’s non-domestic operations from vehi-

the end of the ﬁ scal year stronger against the U.S. 

substitute for U.S. GAAP measures. However, 

aligned on a functional basis with managers having 

cles produced in Japan.

dollar in comparison to the prior ﬁ scal year, it was 

Toyota believes that such results excluding the 

oversight responsibility for the major operating func-

  Toyota believes that the location of its production 

on average and at the end of the ﬁ scal year weaker 

impact of currency ﬂ uctuations year-on-year provide 

tions within the segment. Management assesses 

facilities in different parts of the world has signiﬁ -

in ﬁ scal 2013. In ﬁ scal 2012 and 2013, the 

additional useful information to investors regarding 

ﬁ nancial and non-ﬁ nancial data such as vehicle unit 

cantly reduced the level of transaction risk. As part 

Japanese yen was on average stronger against the 

the operating performance on a local currency basis.

sales, production volume, market share information, 

of its globalization strategy, Toyota has continued to 

euro in comparison to ﬁ scal 2011 and 2012, 

localize production by constructing production facili-

respectively. The Japanese yen was at the end of 

  Segmentation

vehicle model plans and plant location costs to allo-

cate resources within the automotive operations.

ties in the major markets in which it sells its vehicles. 

ﬁ scal 2012 stronger against the euro in comparison 

Toyota’s most signiﬁ cant business segment is its 

In calendar 2011 and 2012, Toyota produced 

to the prior ﬁ scal year, but was weaker at the end of 

automotive operations. Toyota carries out its 

71.3% and 75.4% of its non-domestic sales outside 

ﬁ scal 2013 due to the depreciation of the yen in the 

Japan, respectively. In North America, 66.8% and 

second half of the ﬁ scal year. See further discussion 

75.3% of vehicles sold in calendar 2011 and 2012 

in “Quantitative and Qualitative Disclosures about 

Geographic Breakdown

respectively were produced locally. In Europe, 57.7% 

Market Risk—Market Risk Disclosures—Foreign 

The following table sets forth Toyota’s net revenues in each geographic 

and 58.5% of vehicles sold in calendar 2011 and 

Currency Exchange Rate Risk”.

market based on the country location of the parent company or the 

2012 respectively were produced locally. Localizing 

  During ﬁ scal 2012 and 2013, the average 

subsidiaries that transacted the sale with the external customer for the 

Revenues by Market 
FY2013

(cid:2) Japan　(cid:2) North America　(cid:2) Europe　
(cid:2) Asia　(cid:2) All Other Markets

production enables Toyota to locally purchase many 

exchange rate of the Japanese yen against the U.S. 

past three ﬁ scal years.

of the supplies and resources used in the produc-

dollar and the euro compared to the prior ﬁ scal year 

tion process, which allows for a better match of 

has ﬂ uctuated as described above. The operating 

local currency revenues with local currency expenses.

results excluding the impact of currency ﬂ uctuations 

  Toyota also enters into foreign currency transac-

described in “Results of Operations—Fiscal 2013 

tions and other hedging instruments to address 

Compared with Fiscal 2012” and “Results of 

a portion of its transaction risk. This has reduced, 

Operations—Fiscal 2012 Compared with Fiscal 

but not eliminated, the effects of foreign currency 

2011” show results of net revenues obtained by 

exchange rate ﬂ uctuations, which in some years 

applying the Japanese yen’s average exchange rate 

Yen in millions
Years Ended March 31,
2012
¥7,293,804
4,644,348
1,917,408
3,116,849
1,611,244

2011
¥6,966,929
5,327,809
1,920,416
 3,138,112
 1,640,422

2013
¥7,910,456
6,167,821
2,003,113
4,058,629
1,924,173

Japan
North America
Europe
Asia
Other*

* “Other” consists of Central and South America, Oceania and Africa.

8.7%

18.4%

9.1%

28.0%

35.8%

ANNUAL REPORT 2013

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P a g e  50

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [5 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Results of Operations — Fiscal 2013 Compared with Fiscal 2012

Yen in millions

Years ended March 31,
2013 
2012 

 2013 vs. 2012 Change

Amount

Percentage (%)

Net revenues:
  Japan
  North America
  Europe
  Asia
  Other*

Intersegment elimination/unallocated amount

  Total

Operating income (loss):
  Japan
  North America
  Europe
  Asia
  Other*

Intersegment elimination/unallocated amount

  Total

Operating margin
Income before income taxes and 
  equity in earnings of afﬁ liated companies
Net margin from income before income taxes 
  and equity in earnings of afﬁ liated companies
Equity in earnings of afﬁ liated companies
Net income attributable to 
  Toyota Motor Corporation
Net margin attributable to 
  Toyota Motor Corporation

¥11,167,319 ¥12,821,018
6,284,425
2,083,113
4,385,476
2,094,265
(5,604,105)
¥18,583,653 ¥22,064,192

4,751,886
1,993,946
3,334,274
1,760,175
(4,423,947)

186,409
17,796
 256,790
108,814
(7,142)

¥    (207,040) ¥     576,335
221,925
26,462
376,055
133,744
(13,633)
¥     355,627 ¥  1,320,888
6.0%

1.9%

¥1,653,699
1,532,539
89,167
1,051,202
334,090
(1,180,158)
¥3,480,539

¥   783,375
35,516
8,666
119,265
24,930
(6,491)
¥   965,261
4.1%

+14.8
+32.3
+4.5
+31.5
+19.0
—
+18.7

—
+19.1
+48.7
+46.4
+22.9
—
+271.4

432,873

1,403,649

970,776

+224.3

2.3%
197,701

6.4%
231,519

4.1%
33,818

+17.1

283,559

962,163

678,604

+239.3

1.5%

4.4%

2.9%

* “Other” consists of Central and South America, Oceania and Africa.

  Net Revenues

in a steady manner. Under these automotive market 

Toyota had net revenues for ﬁ scal 2013 of 

conditions, Toyota’s consolidated vehicle unit sales 

¥22,064.1 billion, an increase of ¥3,480.5 billion, or 

increased to 8,871 thousand vehicles by 20.7% 

18.7%, compared with the prior ﬁ scal year. This 

compared with the prior ﬁ scal year.

increase reﬂ ected changes in numbers of the vehi-

cle unit sales and sales mix of ¥3,031.5 billion and 

Net Revenues

favorable impact of ﬂ uctuations in foreign currency 

translation rates of ¥281.8 billion. Excluding the dif-

ference in the Japanese yen value used for transla-

tion purposes of ¥281.8 billion, net revenues would 

have been ¥21,782.3 billion during ﬁ scal 2013, a 

(¥ Billion)
25,000

20,000

15,000

17.2% increase compared with the prior ﬁ scal year. 

10,000

The automotive market in 2012 increased by 11.3% 

in North America and 14.3% in Asia compared with 

the prior ﬁ scal year. In ﬁ scal 2013, the market in the 

U.S. and emerging countries such as Asia developed 

5,000

0

FY

’09

’10

’11

’12

’13

  The table below shows Toyota’s net revenues from external customers by product category and by business.

Vehicles 
Parts and components for overseas production
Parts and components for after service
Other

  Total Automotive

All Other
Total sales of products
Financial services
  Total

Yen in millions

Years ended March 31,
2013 
2012 

¥14,164,940 ¥17,446,473
356,756
1,577,690
997,843
20,378,762
535,388
20,914,150
1,150,042
¥18,583,653 ¥22,064,192

338,000
1,532,219
929,219
16,964,378
547,538
17,511,916
1,071,737

 2013 vs. 2012 Change

Amount
¥3,281,533
18,756
45,471
68,624
3,414,384
(12,150)
3,402,234
78,305
¥3,480,539

Percentage (%)
+23.2
+5.5
+3.0
+7.4
+20.1
–2.2
+19.4
+7.3
+18.7

 
 
 
 
 
 
 
 
 
 
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P a g e  51

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [6 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

  Toyota’s net revenues include net revenues from 

2013 compared with the prior ﬁ scal year. The 

  The following is a discussion of net revenues in each geographic market (before the elimination of 

sales of products, consisting of net revenues from 

increase in net revenues from sales of products is 

 intersegment revenues).

automotive operations and all other operations, 

due to an increase in Toyota vehicle unit sales by 

Japan

which increased by 19.4% during ﬁ scal 2013 com-

1,519 thousand vehicles. Excluding the difference in 

pared with the prior ﬁ scal year to ¥20,914.1 billion, 

the Japanese yen value used for translation purpos-

and net revenues from ﬁ nancial services operations 

es of ¥35.8 billion, net revenues from ﬁ nancial ser-

which increased by 7.3% during ﬁ scal 2013 com-

vices operations would have been ¥1,114.2 billion, 

pared with the prior ﬁ scal year to ¥1,150.0 billion. 

a 4.0% increase during ﬁ scal 2013 compared with 

Excluding the difference in the Japanese yen value 

the prior ﬁ scal year. This increase was mainly due to 

used for translation purposes of ¥246.0 billion, net 

an increase of ¥25.8 billion rental revenue generated 

revenues from sales of products would have been 

by vehicles and equipment on operating lease.

¥20,668.1 billion, an 18.0% increase during ﬁ scal 

Toyota’s consolidated vehicle unit sales* 

* including number of exported vehicle unit sales

Net revenues:
  Sales of products
  Financial services

  Total

Thousands of units

Years ended March 31,
2013 
2012 
4,202
3,741

 2013 vs. 2012 Change

Amount
461

Percentage (%)
+12.3

Yen in millions

Years ended March 31,
2013 
2012 

 2013 vs. 2012 Change

Amount

Percentage (%)

¥11,040,964 ¥12,687,092
133,926
¥11,167,319 ¥12,821,018

126,355

¥1,646,128
7,571
¥1,653,699

+14.9
+6.0
+14.8

  The following table shows the number of ﬁ nancing contracts by geographic region at the end of the ﬁ scal 

2013 and 2012, respectively.

Number of ﬁ nancing contracts in thousands

Toyota’s domestic and exported vehicle unit sales 

Earthquake in the ﬁ rst half of ﬁ scal 2012, an 

increased by 461 thousand vehicles compared with 

increase in demand by subsidies for eco-cars 

 2013 vs. 2012 Change

the prior ﬁ scal year due mainly to a recovery from 

offered by the government and strong sales of Aqua 

Japan
North America
Europe 
Asia 
Other*

  Total 

Years ended March 31,
2013 
2012 
1,765
1,697
4,596
4,535
825
796
868
 649
618
552
8,672
8,229

Amount
68
61
29
219
66
443

Percentage (%)
+4.0
+1.3
+3.7
+33.7
+11.9
+5.4

* “Other” consists of Central and South America, Oceania and Africa.

Toyota’s consolidated vehicle unit sales

the negative impact of the Great East Japan 

and other car models in ﬁ scal 2013.

North America

  Geographically, net revenues (before the elimina-

used for translation purposes of ¥281.8 billion, net 

tion of intersegment revenues) for ﬁ scal 2013 

revenues in ﬁ scal 2013 would have increased by 

increased by 14.8% in Japan, 32.3% in North 

14.8% in Japan, 26.2% in North America, 6.9% in 

America, 4.5% in Europe, 31.5% in Asia, and 

Europe, 28.0% in Asia and 22.5% in Other com-

19.0% in Other compared with the prior ﬁ scal year. 

pared with the prior ﬁ scal year.

Excluding the difference in the Japanese yen value 

Net revenues:
  Sales of products
  Financial services

  Total

Thousands of units

Years ended March 31,
2013 
2012 
2,469
1,872

 2013 vs. 2012 Change

Amount
597

Percentage (%)
+31.9

Yen in millions

Years ended March 31,
2013 
2012 

 2013 vs. 2012 Change

Amount

Percentage (%)

¥4,048,532
703,354
¥4,751,886

¥5,564,183
720,242
¥6,284,425

¥1,515,651
16,888
¥1,532,539

+37.4
+2.4
+32.3

In North America, the vehicle unit sales increased 

steady manner and strong sales of Corolla, Camry 

by 597 thousand vehicles compared with the prior 

and other car models.

ﬁ scal year due mainly to the market recovering in a 

 
 
 
 
 
 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [7 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Europe

Other

Toyota’s consolidated vehicle unit sales

Thousands of units

Years ended March 31,
2013 
2012 
799
798

 2013 vs. 2012 Change

Amount
1

Percentage (%)
+0.1

Yen in millions

Years ended March 31,
2013 
2012 

 2013 vs. 2012 Change

Amount

Percentage (%)

Toyota’s consolidated vehicle unit sales

Net revenues:
  Sales of products
  Financial services

  Total

¥1,925,670
68,276
¥1,993,946

¥2,007,207
75,906
¥2,083,113

¥81,537
7,630
¥89,167

+4.2
+11.2
+4.5

Net revenues:
  Sales of products
  Financial services

  Total

Thousands of units

Years ended March 31,
2013 
2012 
1,640
1,284

 2013 vs. 2012 Change

Amount
356

Percentage (%)
+27.8

Yen in millions

Years ended March 31,
2013 
2012 

 2013 vs. 2012 Change

Amount

Percentage (%)

¥1,636,043
124,132
¥1,760,175

¥1,942,215
152,050
¥2,094,265

¥306,172
27,918
¥334,090

+18.7
+22.5
+19.0

Net revenues in Europe as a whole increased due 

Europe, especially in Russia, although sales of 

Net revenues in Other as a whole increased due pri-

strong sales of IMV and Land Cruiser in each region 

primarily to the 1 thousand vehicles increase in 

Toyota brands’ vehicles decreased in Western 

marily to the 356 thousand vehicles increase in 

in ﬁ scal 2013 and the recovery from the shortages 

vehicle unit sales compared with the prior ﬁ scal 

Europe compared with the prior ﬁ scal year due to 

vehicle unit sales compared with the prior ﬁ scal 

of parts supplies caused by the Great East Japan 

year. The vehicle unit sales increased in Eastern 

the European sovereign debt crisis.

year. The vehicle unit sales increased due mainly to 

Earthquake and the ﬂ ood in Thailand in ﬁ scal 2012.

Asia

  Operating Costs and Expenses

Toyota’s consolidated vehicle unit sales

Net revenues:
  Sales of products
  Financial services

  Total

Thousands of units

Years ended March 31,
2013 
2012 
1,684
1,327

 2013 vs. 2012 Change

Amount
357

Percentage (%)
+26.9

Yen in millions

Years ended March 31,
2013 
2012 

 2013 vs. 2012 Change

Amount

Percentage (%)

¥3,275,871
58,403
¥3,334,274

¥4,307,943
77,533
¥4,385,476

¥1,032,072
19,130
¥1,051,202

+31.5
+32.8
+31.5

Operating costs and expenses:
  Cost of products sold
  Cost of ﬁ nancing operations
  Selling, general and administrative

  Total

Yen in millions

Years ended March 31,
2013 
2012 

 2013 vs. 2012 Change

Amount

Percentage (%)

¥15,795,918 ¥18,010,569
630,426
2,102,309
¥18,228,026 ¥20,743,304

592,646
1,839,462

¥2,214,651
37,780
262,847
¥2,515,278

+14.0
+6.4
+14.3
+13.8

Net revenues in Asia as a whole increased due 

the expansion of markets such as Thailand and 

 primarily to the 357 thousand vehicles increase in 

Indonesia, and the recovery during ﬁ scal 2013 from 

vehicle unit sales compared with the prior ﬁ scal 

the negative impacts of the ﬂ ood in Thailand in 

year. The vehicle unit sales increased due mainly to 

 ﬁ scal 2012.

Changes in operating costs and expenses:
  Effect of changes in vehicle unit sales and sales mix
  Effect of ﬂ uctuation in foreign currency translation rates
  Effect of cost reduction efforts
  Effect of increase in miscellaneous costs and others

  Total

Yen in millions
 2013 vs. 2012 
Change

¥2,360,000
270,000
(450,000)
335,278
¥2,515,278

 
 
 
 
 
 
 
 
 
 
 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [8 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Operating costs and expenses increased by 

announced in Japan and other regions the voluntary 

¥2,515.2 billion, or 13.8%, to ¥20,743.3 billion dur-

safety recall of certain models of Toyota brands’ 

ing ﬁ scal 2013 compared with the prior ﬁ scal year. 

vehicles in relation to the insufﬁ cient hardness treat-

This increase resulted from the ¥2,360.0 billion 

ment of some intermediate extension shafts and in 

impact of changes in vehicle unit sales and sales 

relation to the electric water pump for the hybrid 

mix, the ¥270.0 billion unfavorable impact of ﬂ uctu-

system.

ations in foreign currency translation rates and the 

¥335.2 billion increase in miscellaneous costs and 

Cost Reduction Efforts

others, partially offset by the ¥450.0 billion impact 

During ﬁ scal 2013, Toyota’s continued cost reduc-

of cost reduction efforts.

tion efforts reduced operating costs and expenses 

Cost of Products Sold
(cid:2)(cid:2) Cost of products sold   (cid:3)(cid:3) % of net revenues (Right scale)

(¥ Billion)
20,000

15,000

10,000

5,000

0

Selling, General and Administrative Expenses

Selling, general and administrative expenses 

increased by ¥262.8 billion, or 14.3%, to ¥2,102.3 

billion during ﬁ scal 2013 compared with the prior 

ﬁ scal year. This increase reﬂ ected the ¥90.0 billion 

charge for costs related to the settlement of the 

economic loss claims in the consolidated federal 

action in the U.S., the ¥43.2 billion increase in 

expenses for the ﬁ nancial services operations and 

the ¥35.8 billion unfavorable impact of ﬂ uctuations 

(%)
100

75

50

25

0

  The increase in miscellaneous costs and others 

by ¥450.0 billion. The amount of effect of cost 

FY

’09

’10

’11

’12

’13

in foreign currency translation rates.

was due mainly to the ¥90.0 billion charge for costs 

reduction efforts includes the impact of ﬂ uctuation 

related to the settlement of the economic loss 

in the price of steel, precious metals, non-ferrous 

Cost of Financing Operations

claims in the consolidated federal action in the U.S., 

alloys including aluminum, plastic parts and other 

Cost of ﬁ nancing operations increased by ¥37.7 bil-

the ¥70.0 billion increase in labor costs, the ¥50.0 

production materials and parts. In ﬁ scal 2013, con-

lion, or 6.4%, to ¥630.4 billion during ﬁ scal 2013 

billion impact of increase in product quality related 

tinued cost reduction efforts together with suppliers 

compared with the prior ﬁ scal year. The increase 

expenses and the ¥20.0 billion increase in research 

contributed to the improvement in earnings. These 

resulted from the ¥33.1 billion unfavorable impact of 

and development expenses. This increase in prod-

cost reduction efforts related to ongoing value engi-

ﬂ uctuations in foreign currency translation rates.

R&D Expenses
(cid:2)(cid:2) R&D expenses   (cid:3)(cid:3) % of net revenues (Right scale)

(¥ Billion)
1,000

800

600

400

200

0

(%)
5

4

3

2

1

0

uct quality related expenses resulted from the 

neering and value analysis activities, the use of 

weakening of the Japanese yen at the end of ﬁ scal 

common parts resulting in a reduction of part types 

2013 against other currencies in comparison to the 

and other manufacturing initiatives designed to 

prior ﬁ scal year. See note 14 to the consolidated 

reduce the costs of vehicle production.

ﬁ nancial statements.

  During ﬁ scal 2013, Toyota announced recalls and 

Cost of Products Sold

other safety measures including the following:

Cost of products sold increased by ¥2,214.6 billion, 

In October 2012, Toyota announced in Japan 

or 14.0%, to ¥18,010.5 billion during ﬁ scal 2013 

and other regions the voluntary safety recall of cer-

compared with the prior ﬁ scal year. The increase 

tain models of Toyota brands’ vehicles in relation to 

resulted from the ¥2,124.0 billion impact of changes 

the inspection and application of special ﬂ uorine 

in vehicle unit sales and sales mix and the ¥201.0 

grease to the driver’s side Power Window Master 

billion unfavorable impact of ﬂ uctuations in foreign 

Switch (PWMS). In November 2012, Toyota 

currency translation rates, partially offset by the 

¥450.0 billion impact of cost reduction efforts.

  Operating Income

Changes in operating income and loss:
  Effect of marketing efforts 
  Effect of cost reduction efforts
  Effect of changes in exchange rates
  Effect of increase of miscellaneous costs and others
  Other 

  Total 

FY

’09

’10

’11

’12

’13

Yen in millions
 2013 vs. 2012 Change

¥650,000
450,000
150,000
(300,000)
15,261
¥965,261

 
 
 
 
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P a g e  54

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [9 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Toyota’s operating income increased by ¥965.2 bil-

  During ﬁ scal 2013, operating income (before 

North America

lion, or 271.4%, to ¥1,320.8 billion during ﬁ scal 

elimination of intersegment proﬁ ts), increased by 

2013 compared with the prior ﬁ scal year. This 

¥783.3 billion in Japan compared with the prior ﬁ scal 

increase was due mainly to the ¥650.0 billion 

year, ¥35.5 billion, or 19.1%, in North America, ¥8.6 

increase of marketing efforts, the ¥450.0 billion 

billion, or 48.7%, in Europe, ¥119.2 billion, or 46.4%, 

impact of cost reduction efforts and the ¥150.0 bil-

in Asia, and ¥24.9 billion, or 22.9%, in Other.

lion favorable impact of changes in exchange rates, 

partially offset by the ¥300.0 billion increase in mis-

cellaneous costs and others. The increase in mis-

cellaneous costs and others was due mainly to the 

¥90.0 billion charge for costs related to the settle-

ment of the economic loss claims in the consolidated 

federal action in the U.S., the ¥70.0 billion increase in 

labor costs, the ¥50.0 billion impact of increase in 

product quality related expenses and the ¥20.0 bil-

lion increase in research and development expenses.

Operating Income (Loss)
(cid:2)(cid:2) Operating income (loss)   (cid:3)(cid:3) % of net revenues (Right scale)

(¥ Billion)
1,500

1,000

500

0

-500

(%)
15

10

5

0

-5

  The following is a description of operating income in each geographic market.

Japan

FY

’09

’10

’11

’12

’13

Changes in operating income and loss:
  Effect of marketing efforts 
  Effect of cost reduction efforts
  Effect of changes in exchange rates
  Effect of increase of miscellaneous costs and others
  Other 

  Total 

Yen in millions
 2013 vs. 2012 Change

¥415,000
380,000
165,000
(170,000)
 (6,625)
 ¥783,375

Changes in operating income and loss:
  Effect of marketing efforts
  Effect of cost reduction efforts
  Effect of increase of miscellaneous costs and others
  Other

  Total

Europe

Changes in operating income and loss:
  Effect of marketing efforts
  Effect of cost reduction efforts
  Effect of increase of miscellaneous costs and others
  Other

  Total

Asia

Changes in operating income and loss:
  Effect of marketing efforts 
  Effect of cost reduction efforts
  Effect of changes in exchange rates
  Effect of increase of miscellaneous costs and others
  Other 

  Total 

Yen in millions
 2013 vs. 2012 Change

 ¥30,000
 50,000
(65,000)
20,516
¥35,516

Yen in millions
 2013 vs. 2012 Change

¥5,000
5,000
(5,000)
3,666
 ¥8,666

Yen in millions
 2013 vs. 2012 Change

¥135,000
15,000
 (10,000)
(30,000)
9,265
¥119,265

 
 
 
 
 
 
 
 
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P a g e  55

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [10 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

  Other Income and Expenses

effective tax rate for ﬁ scal 2013 was 39.3%, which 

with the prior ﬁ scal year. This increase resulted from 

Interest and dividend income decreased by ¥1.1 bil-

was higher than the statutory tax rate in Japan. This 

favorable foreign currency translation adjustments 

lion, or 1.2%, to ¥98.6 billion during ﬁ scal 2013 

was due mainly to deferred tax liabilities relating to 

gains of ¥434.6 billion in ﬁ scal 2013 compared with 

compared with the prior ﬁ scal year.

undistributed earnings in afﬁ liated companies 

losses of ¥87.7 billion in the prior ﬁ scal year, and 

Interest expense was ¥22.9 billion during ﬁ scal 

accounted for by the equity method.

from unrealized holding gains on securities in ﬁ scal 

2013, on the same level as that of the prior 

ﬁ scal year.

  Net Income and Loss Attributable to 

¥129.3 billion in the prior ﬁ scal year. The increase in 

2013 of ¥368.5 billion compared with gains of 

  Foreign exchange gain, net decreased by ¥31.5 

Noncontrolling Interests and Equity in 

unrealized holding gains on securities was due 

billion, or 85.0%, to ¥5.5 billion during ﬁ scal 2013 

Earnings of Afﬁ liated Companies

mainly to changes in stock prices.

compared with the prior ﬁ scal year. Foreign 

Net income attributable to noncontrolling interests 

exchange gains and losses include the differences 

increased by ¥36.5 billion, or 43.2%, to ¥121.3 bil-

between the value of foreign currency denominated 

lion during ﬁ scal 2013 compared with the prior ﬁ scal 

assets and liabilities recognized through transac-

year. This increase was due mainly to an increase 

Net Income (Loss) Attributable to 
Toyota Motor Corporation and ROE
(cid:2)(cid:2) Net income (loss) attributable to Toyota Motor Corporation   
(cid:3)(cid:3) ROE (Right scale)

(¥ Billion)
1,000

750

500

250

0

-250

-500

FY

’09

’10

’11

’12

’13

(%)
10.0

7.5

5.0

2.5

0

-2.5

-5.0

tions in foreign currencies translated at prevailing 

during ﬁ scal 2013 in net income attributable to the 

  Segment Information

exchange rates and the value at the date the trans-

shareholders of consolidated subsidiaries.

The following is a discussion of results of operations for each of Toyota’s operating segments. The amounts 

action settled during the ﬁ scal year, including those 

  Equity in earnings of afﬁ liated companies during 

presented are prior to intersegment elimination.

settled using forward foreign currency exchange 

ﬁ scal 2013 increased by ¥33.8 billion, or 17.1%, to 

contracts, or the value translated by appropriate 

¥231.5 billion compared with the prior ﬁ scal year. 

year-end current exchange rates. The ¥31.5 billion 

This increase was due mainly to an increase during 

decrease in foreign exchange gain, net was due 

ﬁ scal 2013 in net income attributable to the share-

mainly to the losses resulting from the Japanese 

holders of afﬁ liated companies accounted for by the 

yen being stronger against foreign currencies at the 

equity method.

time foreign currency bonds were redeemed during 

ﬁ scal 2013 than those at the time of purchase.

  Net Income Attributable to Toyota Motor 

  Other loss, net increased by ¥38.3 billion to ¥1.5 

Corporation

billion during ﬁ scal 2013 compared with the prior 

Net income attributable to the shareholders of 

Automotive:

Financial Services:

All Other:

Intersegment elimination/
  unallocated amount:

Net revenues
Operating income
Net revenues
Operating income
Net revenues
Operating income
Net revenues
Operating income

Yen in millions

Years ended March 31,
2013 
2012 

¥16,994,546 ¥20,419,100
944,704
1,170,670
315,820
1,066,461
53,616
(592,039)
6,748

21,683
1,100,324
306,438
1,048,915
42,062
(560,132)
(14,556)

 2013 vs. 2012 Change

Amount
¥3,424,554
923,021
70,346
9,382
17,546
11,554
(31,907)
21,304

Percentage (%)

+20.2
+4,256.9
+6.4
+3.1
+1.7
+27.5
—
—

ﬁ scal year.

Toyota Motor Corporation increased by ¥678.6 bil-

Automotive Operations Segment

impact of changes in vehicle unit sales and sales 

lion, or 239.3%, to ¥962.1 billion during ﬁ scal 2013 

The automotive operations segment is Toyota’s 

mix and the ¥245.4 billion favorable impact of ﬂ uc-

  Income Taxes

compared with the prior ﬁ scal year.

largest operating segment by net revenues. Net rev-

tuations in foreign currency translation rates.

The provision for income taxes increased by ¥289.4 

enues for the automotive segment increased during 

  Operating income from the automotive operations 

billion, or 110.3%, to ¥551.6 billion during ﬁ scal 

  Other Comprehensive Income and Loss

ﬁ scal 2013 by ¥3,424.5 billion, or 20.2%, compared 

increased by ¥923.0 billion during ﬁ scal 2013 com-

2013 compared with the prior ﬁ scal year due to the 

Other comprehensive income increased by ¥856.8 

with the prior ﬁ scal year to ¥20,419.1 billion. The 

pared with the prior ﬁ scal year to ¥944.7 billion. This 

increase in income before income taxes. The 

billion to ¥822.7 billion for ﬁ scal 2013 compared 

increase reﬂ ects the ¥3,030.0 billion of favorable 

increase in operating income was due mainly to the 

 
ANNUAL REPORT 2013

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P a g e  56

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [11 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

cles compared with the prior ﬁ scal year resulting 

  Operating income from ﬁ nancial services opera-

Intersegment elimination/unallocated amount

¥150.0 billion favorable impact of changes in 

Financial Services Operations Segment

exchange rates, the ¥645.0 billion of favorable 

Net revenues for the ﬁ nancial services operations 

impact of changes in vehicle unit sales and sales 

increased during ﬁ scal 2013 by ¥70.3 billion, or 

mix, and the ¥450.0 billion impact of cost reduction 

6.4%, compared with the prior ﬁ scal year to 

efforts, partially offset by the ¥300.0 billion increase 

¥1,170.6 billion. This increase was primarily due to 

in miscellaneous costs and others.

the ¥36.0 billion favorable impact of ﬂ uctuations in 

  The changes in vehicle unit sales and changes in 

foreign currency translation rates and the ¥25.8 bil-

sales mix was due primarily to the increase in 

lion increase in rental income from vehicles and 

Toyota’s vehicle unit sales by 1,519 thousand vehi-

equipment on operating leases.

from the increase in vehicle unit sales in every 

tions increased by ¥9.3 billion, or 3.1%, to ¥315.8 

region. The increase in miscellaneous costs and 

billion during ﬁ scal 2013 compared with the prior 

others was due mainly to the ¥90.0 billion charge 

ﬁ scal year. This increase was due primarily to the 

for costs related to the settlement of the economic 

recording of ¥12.9 billion of valuation gains on inter-

loss claims in the consolidated federal action in the 

est rate swaps stated at fair value.

U.S., the ¥70.0 billion increase in labor costs, the 

¥50.0 billion impact of increase in product quality 

related expenses and the ¥20.0 billion increase in 

research and development expenses.

  Ratio of credit loss experience in the United States is as follows:

Net charge-offs as a percentage of average gross earning assets:
  Finance receivables
  Operating lease 

  Total

Years ended March 31,

2012 

2013 

0.24%
 0.11
 0.21%

0.29%
0.18
0.27%

All Other Operations Segment

  Operating income from Toyota’s other operations 

Net revenues for Toyota’s other operations seg-

segments increased by ¥11.5 billion, or 27.5%, to 

ments increased by ¥17.5 billion, or 1.7%, to 

¥53.6 billion during ﬁ scal 2013 compared with the 

¥1,066.4 billion during ﬁ scal 2013 compared with 

prior ﬁ scal year.

the prior ﬁ scal year.

Results of Operations — Fiscal 2012 Compared with Fiscal 2011

Net revenues:
  Japan
  North America
  Europe
  Asia
  Other*

  Total

Operating income (loss):
  Japan
  North America
  Europe
  Asia
  Other*

Intersegment elimination/unallocated amount

  Total

Operating margin
Income before income taxes and 
  equity in earnings of afﬁ liated companies
Net margin from income before income taxes 
  and equity in earnings of afﬁ liated companies
Equity in earnings of afﬁ liated companies
Net income attributable to 
  Toyota Motor Corporation
Net margin attributable to 
  Toyota Motor Corporation

* “Other” consists of Central and South America, Oceania and Africa.

Yen in millions

Years ended March 31,
2012 
2011 

 2012 vs. 2011 Change

Amount

Percentage (%)

 ¥10,986,246 ¥11,167,319
4,751,886
1,993,946
3,334,274
1,760,175
(4,423,947)
¥18,993,688 ¥18,583,653

 5,429,136
1,981,497
3,374,534
 1,809,116
 (4,586,841)

¥    (362,396) ¥    (207,040)
186,409
17,796
256,790
108,814
(7,142)
¥     468,279 ¥     355,627

339,503
13,148
 312,977
160,129
4,918

2.5%

1.9%  

¥ 181,073
(677,250)
12,449
(40,260)
(48,941)
162,894
¥(410,035)

¥ 155,356
(153,094)
4,648
(56,187)
(51,315)
(12,060)
¥(112,652)
(0.6)%

+1.6
–12.5
+0.6
–1.2
–2.7
—
–2.2

—
–45.1
+35.4
–18.0
–32.0
—
–24.1

563,290

432,873

(130,417)

–23.2

3.0%
 215,016

2.3%  

197,701

(0.7)%
(17,315)

–8.1

408,183

283,559

(124,624)

–30.5

2.1%

1.5%  

(0.6)%

 
 
 
 
 
 
 
 
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P a g e  57

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [12 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

  Net Revenues

¥19,301.3 billion during ﬁ scal 2012, a 1.6% 

products is due to an increase in Toyota vehicle unit 

approximately ¥1,138.6 billion, a 2.9% decrease 

Toyota had net revenues for ﬁ scal 2012 of 

increase compared with the prior ﬁ scal year. The 

sales by 44 thousand vehicles. Excluding the differ-

during ﬁ scal 2012 compared with the prior ﬁ scal 

¥18,583.6 billion, a decrease of ¥410.0 billion, or 

automotive market in ﬁ scal 2012 increased by 9.7% 

ence in the Japanese yen value used for translation 

year. This decrease was mainly due to the decrease 

2.2%, compared with the prior ﬁ scal year. This 

in North America and 3.9% in Asia compared with 

purposes of ¥66.9 billion, net revenues from ﬁ nan-

of ¥18.3 billion rental revenue generated by vehicles 

decrease reﬂ ects unfavorable impact of ﬂ uctuations 

the prior ﬁ scal year due to that market in the U.S. 

cial services operations would have been 

and equipment on operating lease.

in foreign currency translation rates and others of 

and emerging countries such as Asia have devel-

¥717.7 billion, partially offset by changes in num-

oped in a steady manner. Under these automotive 

  The following table shows the number of ﬁ nancing contracts by geographic region at the end of the ﬁ scal 

bers of the vehicle unit sales and sales mix of 

market conditions, despite the Great East Japan 

2012 and 2011, respectively.

approximately ¥320.0 billion and other factors. 

Earthquake and the ﬂ ood in Thailand, Toyota’s con-

Excluding the difference in the Japanese yen value 

solidated vehicle unit sales increased to 7,352 thou-

used for translation purposes of ¥717.7 billion, net 

sand vehicles by 0.6% compared with the prior 

revenues would have been approximately 

ﬁ scal year.

  The table below shows Toyota’s net revenues from external customers by product category and by business.

Vehicles
Parts and components for overseas production
Parts and components for after service
Other

  Total Automotive

All Other
Total sales of products
Financial services
  Total

Yen in millions

Years ended March 31,
2012
2011 

¥14,507,479 ¥14,164,940
338,000
1,532,219
929,219
16,964,378
547,538
17,511,916
1,071,737
¥18,993,688 ¥18,583,653

335,366
1,553,497
926,411
17,322,753
497,767
17,820,520
1,173,168

 2012 vs. 2011 Change

Amount
¥(342,539)
2,634
(21,278)
2,808
(358,375)
49,771
(308,604)
(101,431)
¥(410,035)

Percentage (%)
–2.4
+0.8
–1.4
+0.3
–2.1
+10.0
–1.7
–8.6
–2.2

  Toyota’s net revenues include net revenues from 

2012 compared with the prior ﬁ scal year to 

sales of products, consisting of net revenues from 

¥1,071.7 billion. Excluding the difference in the 

automotive operations and all other operations, 

Japanese yen value used for translation purposes of 

which decreased by 1.7% during ﬁ scal 2012 com-

¥650.8 billion, net revenues from sales of products 

pared with the prior ﬁ scal year to ¥17,511.9 billion, 

would have been ¥18,162.7 billion, a 1.9% increase 

and net revenues from ﬁ nancial services operations 

during ﬁ scal 2012 compared with the prior ﬁ scal 

which decreased by 8.6% during ﬁ scal 

year. The increase in net revenues from sales of 

Japan
North America
Europe 
Asia 
Other*

  Total 

Number of ﬁ nancing contracts in thousands

Years ended March 31,
2012
2011 
1,697
1,709
4,535
4,654
796
790
649
522
552
527
8,229
8,202

 2012 vs. 2011 Change

Amount
(12)
(119)
6
127
25
27

Percentage (%)
–0.7
–2.6
+0.7
+24.3
+4.9
+0.3

* “Other” consists of Central and South America, Oceania and Africa.

  Geographically, net revenues (before the elimina-

difference in the Japanese yen value used for trans-

tion of intersegment revenues) for ﬁ scal 2012 

lation purposes of ¥717.7 billion, net revenues in 

decreased by 12.5% in North America, 1.2% in 

 ﬁ scal 2012 would have decreased by 5.1% in North 

Asia, and 2.7% in Other, whereas net revenues 

America, and would have increased by 1.6% in 

increased by 1.6% in Japan and 0.6% in Europe 

Japan, 5.3% in Europe, 3.8% in Asia and 1.7% in 

compared with the prior ﬁ scal year. Excluding the 

Other compared with the prior ﬁ scal year.

 
 
 
 
 
 
 
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P a g e  58

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [13 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

  The following is a discussion of net revenues in each geographic market (before the elimination of interseg-

decrease in RAV4 sales, a 26 thousand vehicles, or 

compared with the prior ﬁ scal year due to the 

Thousands of units

Net revenues in North America decreased 

rates of ¥398.9 billion.

22.4%, decrease in Tundra sales, and a 21 thou-

decrease in vehicle unit sales and the unfavorable 

sand vehicles, or 7.3%, decrease in Corolla sales. 

impact of ﬂ uctuations in foreign currency translation 

ment revenues).

Japan

Toyota’s consolidated vehicle unit sales* 

* including number of exported vehicle unit sales

Years ended March 31,
2012
2011 
3,741
3,611

 2012 vs. 2011 Change

Amount
130

Percentage (%)
+3.6

Europe

Yen in millions

Years ended March 31,
2012
2011 

 2012 vs. 2011 Change

Amount

Percentage (%)

Toyota’s consolidated vehicle unit sales

Net revenues:
  Sales of products
  Financial services

  Total

¥10,864,329 ¥11,040,964
126,355
 ¥10,986,246 ¥11,167,319

121,917

¥176,635
4,438
¥181,073

+1.6
+3.6
+1.6

Although Toyota’s domestic and exported vehicle 

thousand vehicles compared with the prior ﬁ scal 

unit sales decreased due to the impact of the Great 

year. The increase in vehicle unit sales resulted 

Net revenues:
  Sales of products
  Financial services

  Total

Thousands of units

Years ended March 31,
2012
2011 
798
796

 2012 vs. 2011 Change

Amount
2

Percentage (%)
+0.3

Yen in millions

Years ended March 31,
2012
2011 

 2012 vs. 2011 Change

Amount

Percentage (%)

¥1,910,336
 71,161
¥1,981,497

¥1,925,670
68,276
¥1,993,946

¥15,334
(2,885)
¥12,449

+0.8
–4.1
+0.6

East Japan Earthquake in the ﬁ rst half of ﬁ scal 

2012, Toyota’s domestic and exported vehicle unit 

 primarily from introduction of new products such as 
Prius (cid:2) and Aqua.

Net revenues in Europe as a whole increased due 

European countries compared with the prior ﬁ scal 

primarily to the 2 thousand vehicles increase in vehi-

year, such as a 18 thousand vehicles decrease in 

sales over the ﬁ scal year increased by 130 

North America

cle unit sales compared with the prior ﬁ scal year, 

Italy and a 7 thousand vehicles decrease in 

such as a 49 thousand vehicles increase in Russia, 

Portugal, both of which were mainly due to the 

where the economy has been strong, although 

European sovereign debt crisis.

Toyota’s consolidated vehicle unit sales

Years ended March 31,
2012
2011 
1,872
2,031

 2012 vs. 2011 Change

Amount
(159)

Percentage (%)
–7.8

Asia

Thousands of units

sales of Toyota brands’ vehicles decreased in some 

Net revenues:
  Sales of products
  Financial services

  Total

Yen in millions

Years ended March 31,
2012
2011 

 2012 vs. 2011 Change

Amount

Percentage (%)

 ¥4,603,192
825,944
 ¥5,429,136

¥4,048,532
703,354
¥4,751,886

¥(554,660)
(122,590)
¥(677,250)

–12.0
–14.8
–12.5

In North America, the vehicle unit sales decreased 

of shortages of parts supplies caused by the Great 

by 159 thousand vehicles compared with the prior 

East Japan Earthquake and the ﬂ ood in Thailand, 

ﬁ scal year due to decreased production as a result 

consisting of a 67 thousand vehicles, or 30.7%, 

Toyota’s consolidated vehicle unit sales

Net revenues:
  Sales of products
  Financial services

  Total

Thousands of units

Years ended March 31,
2012
2011 
1,327
1,255

 2012 vs. 2011 Change

Amount
72

Percentage (%)
+5.7

Yen in millions

Years ended March 31,
2012
2011 

 2012 vs. 2011 Change

Amount

Percentage (%)

 ¥3,325,466
 49,068
 ¥3,374,534

¥3,275,871
58,403
¥3,334,274

¥(49,595)
9,335
¥(40,260)

–1.5
+19.0
–1.2

 
 
 
 
 
 
 
 
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Contents

P a g e  59

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [14 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Despite the ﬂ ood in Thailand, Toyota’s vehicle unit 

Asia decreased compared with the prior ﬁ scal year 

sales in Asia increased by 72 thousand vehicles 

mainly due to the unfavorable impact of ﬂ uctuations 

compared with the prior ﬁ scal year due to steady 

in foreign currency translation rates of ¥168.8 billion 

growth in automotive markets. Although Toyota’s 

and others.

vehicle unit sales in Asia increased, net revenues in 

Other

Toyota’s consolidated vehicle unit sales

Net revenues:
  Sales of products
  Financial services

  Total

Thousands of units

Years ended March 31,
2012
2011 
1,284
1,313

 2012 vs. 2011 Change

Amount
(29)

Percentage (%)
–2.2

Yen in millions

Years ended March 31,
2012
2011 

 2012 vs. 2011 Change

Amount

Percentage (%)

¥1,694,680
114,436
¥1,809,116

¥1,636,043
124,132
¥1,760,175

¥(58,637)
9,696
¥(48,941)

–3.5
+8.5
–2.7

Changes in operating costs and expenses:
  Effect of changes in vehicle unit sales and sales mix and other operational factors
  Effect of ﬂ uctuation in foreign currency translation rates and others
  Effect of cost reduction efforts
  Effect of increase in miscellaneous costs and others

  Total

Yen in millions
 2012 vs. 2011 Change

¥ 150,000
(432,300)
(150,000)
134,917
¥(297,383)

Operating costs and expenses decreased by 

relation to damage to elements of the substrate and 

¥297.3 billion, or 1.6%, to ¥18,228.0 billion during 

potential shutdown of the hybrid system that may 

ﬁ scal 2012 compared with the prior ﬁ scal year. This 

have resulted from improper manufacturing of elec-

decrease resulted from the ¥432.3 billion favorable 

tronic converter control substrate. The affected 

impact of ﬂ uctuations in foreign currency translation 

vehicle models included Harrier Hybrid, Kluger 

rates and others, and the ¥150.0 billion impact of 

Hybrid, RX400h, and Highlander Hybrid, 111 thou-

cost reduction efforts, partially offset by the ¥150.0 

sand vehicles were included in this recall.

billion impact of changes in vehicle unit sales and 

In September 2011, Toyota announced in Japan the 

sales mix and other operational factors and the ¥134.9 

service campaign of certain models of Toyota in relation 

Net revenues in Other decreased due to decreases 

Toyota’s vehicle unit sales decreased by 25 thou-

billion increase in miscellaneous costs and others.

to abnormal noise and oil leakage that may have result-

in Toyota’s vehicle unit sales primarily as a result of 

sand vehicles in Oceania, and by 19 thousand vehi-

  The increase in miscellaneous costs and others 

ed from slack of bolts in the sub transmission and the 

shortages of parts supplies caused by the Great 

cles in the Middle East, respectively, compared with 

was due mainly to a ¥100.0 billion increase in labor 

rear wheel differential. The affected vehicle models 

East Japan Earthquake and the ﬂ ood in Thailand. 

the prior ﬁ scal year.

costs, a ¥50.0 billion increase in research and devel-

included EstimaL, EstimaT and Wish, 181 thousand 

  Operating Costs and Expenses

Operating costs and expenses:
  Cost of products sold
  Cost of ﬁ nancing operations 
  Selling, general and administrative 

  Total 

Yen in millions

Years ended March 31,
2012
2011 

 2012 vs. 2011 Change

Amount

Percentage (%)

¥15,985,783 ¥15,795,918
592,646
1,839,462
 ¥18,525,409 ¥18,228,026

629,543
1,910,083

¥(189,865)
(36,897)
(70,621)
¥(297,383)

–1.2
–5.9
–3.7
–1.6

opment expenses and the ¥104.9 billion increase in 

vehicles were included in this service campaign. 

other various costs, partially offset by the ¥120.0 

In November 2011, Toyota announced in Japan 

billion impact of decrease in product quality related 

and other regions the voluntary safety recall of cer-

expenses and others. This cost decreased because 

tain models of Toyota and Lexus brands’ vehicles in 

costs related to recalls and other safety measures 

relation to abnormal noise, charge warning light 

occurred at a high level during the prior ﬁ scal year. 

indicators, and increasing of handle operation force 

See note 14 to the consolidated ﬁ nancial statements.

resulted from peeling of a bonded part of the engine 

  During ﬁ scal 2012, Toyota announced recalls and 

crankshaft pulley. The affected vehicle models 

other safety measures including the following:

included AlphardG, AlphardV, EstimaL, EstimaT, 

In June 2011, Toyota announced in Japan and 

KlugerV, KlugerL, Kluger Hybrid, Harrier, Harrier 

other regions a voluntary safety recall of certain 

Hybrid, Windom, RX300, RX330, RX400h, ES300, 

models of Toyota and Lexus brands’ vehicles in 

ES330, Solara, Camry, Avalon, Sienna, Highlander, 

 
 
 
 
 
 
 
 
 
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P a g e  60

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [15 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

and Highlander Hybrid, 549 thousand vehicles were 

others, and the ¥150.0 billion impact of cost reduc-

  Operating Income

included in this recall.

tion efforts, partially offset by the ¥135.0 billion 

impact of changes in vehicle unit sales and sales 

Cost Reduction Efforts

mix and other operational factors, and ¥110.0 billion 

During ﬁ scal 2012, Toyota’s continued cost reduc-

increase in miscellaneous costs and others. The 

tion efforts reduced operating costs and expenses 

increase in miscellaneous costs was due mainly to 

by ¥150.0 billion. The amount of effect of cost 

the ¥50.0 billion increase in research and develop-

Changes in operating income and loss:
  Effect of changes in vehicle unit sales and sales mix and other operational factors
  Effect of ﬂ uctuation in foreign currency translation rates and others
  Effect of increase in miscellaneous costs and others 
  Effect of cost reduction efforts, ﬁ nancial services operations, and others 

reduction efforts includes the impact of ﬂ uctuation in 

ment expenses and the ¥80.0 billion increase in 

  Total

Yen in millions
 2012 vs. 2011 Change

¥ 170,000
(285,400)
 (100,000)
 102,748
 ¥(112,652)

the price of steel, precious metals, non-ferrous 

labor costs.

alloys including aluminum, plastic parts and other 

Toyota’s operating income decreased by ¥112.6 bil-

¥102.7 billion increase of cost reduction efforts, 

production materials and parts. In ﬁ scal 2012, raw 

Cost of Financing Operations

lion, or 24.1%, to ¥355.6 billion during ﬁ scal 2012 

ﬁ nancial services operations, and others reﬂ ects the 

materials prices were on an increasing trend; how-

Cost of ﬁ nancing operations decreased by ¥36.8 

compared with the prior ﬁ scal year. This decrease 

¥150.0 billion impact of cost reduction efforts, par-

ever, continued cost reduction efforts together with 

billion, or 5.9%, to ¥592.6 billion during ﬁ scal 2012 

was due mainly to the ¥285.4 billion unfavorable 

tially offset by the ¥10.0 billion decrease in operating 

suppliers contributed to the improvement in earn-

compared with the prior ﬁ scal year. The decrease 

impact of ﬂ uctuations in foreign currency translation 

income in the ﬁ nancial services operations.

ings by more than offsetting the effects from raw 

resulted from the ¥35.7 billion favorable impact of 

rates and others, and the ¥100.0 billion increase in 

  During ﬁ scal 2012, operating loss (before elimina-

materials price increase. These cost reduction 

ﬂ uctuations in foreign currency translation rates and 

miscellaneous costs and others, partially offset by 

tion of intersegment proﬁ ts), decreased by 

efforts related to ongoing value engineering and 

others, partially offset by the ¥20.8 billion recording 

the ¥170.0 billion of favorable impact by changes in 

¥155.3 billion in Japan compared with the prior 

value analysis activities, the use of common parts 

of valuation losses on interest rate swaps stated at 

vehicle unit sales and sales mix and other opera-

 ﬁ scal year. During ﬁ scal 2012, operating income 

resulting in a reduction of part types and other man-

fair value.

ufacturing initiatives designed to reduce the costs of 

tional factors and the ¥102.7 billion increase of cost 

(before elimination of intersegment proﬁ ts), increased 

reduction efforts, ﬁ nancial services operations, and 

by ¥4.6 billion, or 35.4%, in Europe compared 

vehicle production.

Selling, General and Administrative Expenses

others. The unfavorable impact of ﬂ uctuations in for-

with the prior ﬁ scal year, whereas it decreased by 

Cost of Products Sold

decreased by ¥70.6 billion, or 3.7%, to ¥1,839.4 

¥250.0 billion unfavorable impact of ﬂ uctuations 

by ¥56.2 billion, or 18.0%, in Asia, and decreased 

Cost of products sold decreased by ¥189.8 billion, 

billion during ﬁ scal 2012 compared with the prior 

in foreign currency transaction rates. The 

by ¥51.3 billion, or 32.0%, in Other.

Selling, general and administrative expenses 

eign currency translation rates and others included 

¥153.0 billion, or 45.1%, in North America, decreased 

or 1.2%, to ¥15,795.9 billion during ﬁ scal 2012 

ﬁ scal year. This decrease reﬂ ects the ¥53.0 billion 

compared with the prior ﬁ scal year. The decrease 

favorable impact of ﬂ uctuations in foreign currency 

  The following is a description of operating income and loss in each geographic market.

resulted from the ¥343.6 billion favorable impact of 

translation rates and others, and the ¥19.2 billion 

Japan

ﬂ uctuations in foreign currency translation rates and 

decrease for the ﬁ nancial services operations.

Changes in operating income and loss:
  Effect of changes in vehicle unit sales and sales mix and other operational factors
  Effect of ﬂ uctuation in foreign currency translation rates and others
  Effect of cost reduction efforts, decrease in miscellaneous costs and others

  Total

Yen in millions
 2012 vs. 2011 Change

¥195,000
 (275,000)
235,356
¥155,356

 
 
 
 
 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [16 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The decrease in operating losses in Japan reﬂ ects 

 foreign currency transaction rates and others. The 

The increase in operating income in Europe was 

vehicle unit sales and sales mix and other opera-

the ¥195.0 billion of favorable impact by changes in 

cost reduction efforts, decrease in miscellaneous costs 

due to the ¥10.0 billion impact of cost reduction 

tional factors and the ¥1.2 billion unfavorable impact 

vehicle unit sales and sales mix and other opera-

and others mainly reﬂ ect the ¥130.0 billion impact of 

efforts and the ¥5.0 billion increase in operating 

of ﬂ uctuations in foreign currency translation rates 

tional factors and ¥235.3 billion impact of the cost 

the cost reduction efforts and ¥40.0 billion decrease in 

income in the ﬁ nancial services operations, partially 

and others.

reduction efforts, and decrease in miscellaneous 

miscellaneous costs and others. The increase in vehicle 

offset by ¥15.0 billion negative impact of changes in 

costs and others, partially offset by the ¥275.0 bil-

lion unfavorable impact of effect of ﬂ uctuation in 

unit sales was mainly due to introduction of new prod-
ucts such as Prius (cid:2) and Aqua.

Asia

North America

Changes in operating income and loss:
  Effect of changes in vehicle unit sales and sales mix and other operational factors
  Effect of ﬂ uctuation in foreign currency translation rates and others 
  Effect of cost reduction efforts, increase in miscellaneous costs and others

  Total

Yen in millions
 2012 vs. 2011 Change

¥    (5,000)
(7,500)
 (140,594)
 ¥(153,094)

Changes in operating income and loss:
  Effect of changes in vehicle unit sales and sales mix and other operational factors
  Effect of ﬂ uctuation in foreign currency translation rates and others
  Effect of cost reduction efforts, increase in miscellaneous costs and others

  Total

Yen in millions
 2012 vs. 2011 Change

¥(10,000)
11,600
(57,787)
¥(56,187)

The decrease in operating income in Asia was due 

  The net gain of ¥37.1 billion in ﬁ scal 2012 was 

to the ¥10.0 billion negative impact of changes in 

primarily attributable to Toyota Motor Corporation’s 

The decrease in operating income in North America 

¥5.0 billion negative impact of changes in vehicle unit 

vehicle unit sales and sales mix and other opera-

receivables denominated in the U.S. dollars, speciﬁ -

was due to the ¥55.0 billion decrease in operating 

sales and sales mix and other operational factors 

tional factors and others and the ¥35.0 billion 

cally transactional gains on account of an increase 

income in the ﬁ nancial services operations, the 

and the ¥90.0 billion increase in  miscellaneous 

increase in miscellaneous costs and others, partially 

in export volume due to the recovery of production 

¥7.5 billion unfavorable impact of the  ﬂ uctuations in 

costs and others.

offset by the ¥11.6 billion favorable impact of the 

levels in the second half of ﬁ scal 2012 after the 

foreign currency translation rates and others, the 

ﬂ uctuation in foreign currency translation rates 

Great East Japan Earthquake, and the weakening 

Europe

and others.

of the Japanese yen against the U.S. dollar in the 

second half of ﬁ scal 2012, together with the impact 

Yen in millions
 2012 vs. 2011 Change

  Other Income and Expenses

of forward foreign currency exchange contracts, 

Interest and dividend income increased by ¥9.0 bil-

which were mainly denominated in the U.S. dollars 

Changes in operating income and loss:
  Effect of changes in vehicle unit sales and sales mix and other operational factors
  Effect of ﬂ uctuation in foreign currency translation rates and others
  Effect of cost reduction efforts, decrease in miscellaneous costs and others

  Total

¥(15,000)
(1,200)
20,848
¥   4,648

lion, or 10.0%, to ¥99.8 billion during ﬁ scal 2012 

and the yen as well as the euro and the yen.

compared with the prior ﬁ scal year.

  The ¥22.8 billion increase in foreign exchange 

Interest expense decreased by ¥6.3 billion, or 

gain, net, during ﬁ scal 2012 compared with the 

21.8%, to ¥22.9 billion during ﬁ scal 2012 compared 

prior ﬁ scal year was mainly attributable to the losses 

with the prior ﬁ scal year.

incurred by certain subsidiaries during ﬁ scal 2011. 

  Foreign exchange gain, net increased by ¥22.8 

Such losses were principally due to the Brazilian real 

billion, or 159.4%, to ¥37.1 billion during ﬁ scal 2012 

and the Thai baht, the functional currencies for 

compared with the prior ﬁ scal year.

Toyota Motor Corporation’s Brazilian and Thai 

 
 
 
 
 
 
 
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P a g e  62

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [17 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

subsidiaries, respectively, both strengthening 

ﬁ scal 2012 in net income attributable to the share-

  Segment Information

against the U.S. dollar, decreasing the value of 

holders of consolidated subsidiaries.

The following is a discussion of results of operations for each of Toyota’s operating segments. The amounts 

assets denominated in dollars that were not settled 

  Equity in earnings of afﬁ liated companies during ﬁ s-

presented are prior to intersegment elimination.

during the year.

cal 2012 decreased by ¥17.3 billion, or 8.1%, to 

  Other loss, net decreased by ¥56.0 billion to 

¥197.7 billion compared with the prior ﬁ scal year. This 

¥36.8 billion during ﬁ scal 2012 compared with the 

decrease was due to a decrease during ﬁ scal 2012 in 

prior ﬁ scal year. This was due to the recognition of 

net income attributable to the shareholders of afﬁ liated 

impairment losses on available-for-sale securities.

companies accounted for by the equity method.

Automotive:

Financial Services:

  Income Taxes

  Net Income Attributable to Toyota Motor 

All Other:

The provision for income taxes decreased by ¥50.5 

Corporation

billion, or 16.2%, to ¥262.2 billion during ﬁ scal 2012 

Net income attributable to the shareholders of 

compared with the prior ﬁ scal year due to the 

Toyota Motor Corporation decreased by ¥124.6 bil-

Intersegment elimination/
  unallocated amount:

Yen in millions

Years ended March 31,
2012
2011 

¥17,337,320 ¥16,994,546
21,683
1,100,324
306,438
1,048,915
42,062
(560,132)
(14,556)

85,973
1,192,205
358,280
972,252
35,242
(508,089)
(11,216)

 2012 vs. 2011 Change

Amount
¥(342,774)
(64,290)
(91,881)
(51,842)
76,663
6,820
(52,043)
(3,340)

Percentage (%)
–2.0
–74.8
–7.7
–14.5
+7.9
+19.4
—
—

Net revenues
Operating income
Net revenues
Operating income
Net revenues
Operating income
Net revenues
Operating income

decrease in income before income taxes. The effec-

lion, or 30.5%, to ¥283.5 billion during ﬁ scal 2012 

Automotive Operations Segment

  The changes in vehicle unit sales and changes in 

tive tax rate for ﬁ scal 2012 was 60.6%, which was 

compared with the prior ﬁ scal year.

The automotive operations segment is Toyota’s larg-

sales mix was due primarily to an increase in 

higher than the statutory tax rate in Japan. This was 

est operating segment by net revenues. Net reve-

Toyota’s vehicle unit sales by 44 thousand vehicles 

due to recurring items such as the valuation allow-

  Other Comprehensive Income and Loss

nues for the automotive segment decreased during 

compared with the prior ﬁ scal year resulting from 

ance and deferred tax liabilities relating to undistrib-

Other comprehensive loss decreased by ¥263.8 bil-

ﬁ scal 2012 by ¥342.7 billion, or 2.0%, compared 

the introduction of new products in spite of the 

uted earnings in afﬁ liated companies accounted for 

lion to ¥34.1 billion for ﬁ scal 2012 compared with 

with the prior ﬁ scal year to ¥16,994.5 billion. The 

impact of the Great East Japan Earthquake and the 

by the equity method.

the prior ﬁ scal year. This decrease resulted from 

decrease reﬂ ects the ¥649.2 billion unfavorable 

ﬂ ood in Thailand. The increase in miscellaneous 

  Net Income and Loss Attributable to 

losses of ¥87.7 billion in ﬁ scal 2012 compared with 

rates and others, partially offset by the ¥320.0 billion 

billion increase in labor costs and the ¥50.0 billion 

Noncontrolling Interests and Equity in 

losses of ¥287.6 billion in the prior ﬁ scal year, and 

of favorable impact by changes in vehicle unit sales 

increase in research and development expenses.

unfavorable foreign currency translation adjustments 

impact of ﬂ uctuations in foreign currency translation 

costs and others was due primarily to the ¥100.0 

Earnings of Afﬁ liated Companies

from unrealized holding gains on securities in ﬁ scal 

and sales mix, and other operational factors.

Net income attributable to noncontrolling interests 

2012 of ¥129.3 billion compared with losses of 

  Operating income from the automotive operations 

Financial Services Operations Segment

increased by ¥27.4 billion, or 47.9%, to ¥84.7 billion 

¥26.1 billion in the prior ﬁ scal year. The increase in 

decreased by ¥64.3 billion during ﬁ scal 2012 com-

Net revenues for the ﬁ nancial services operations 

during ﬁ scal 2012 compared with the prior ﬁ scal 

unrealized holding gains on securities was due to 

pared with the prior ﬁ scal year to ¥21.6 billion. This 

decreased during ﬁ scal 2012 by ¥91.8 billion, or 

year. This increase was due to an increase during 

changes in stock prices.

decrease in operating income was due to the 

7.7%, compared with the prior ﬁ scal year to 

¥250.0 billion unfavorable impact of ﬂ uctuations in 

¥1,100.3 billion. This decrease was primarily due to 

foreign currency rates and the ¥100.0 billion 

the unfavorable impact of ﬂ uctuations in foreign cur-

increase in miscellaneous costs and others, partially 

rency translation rates and others of ¥66.9 billion 

offset by the ¥170.0 billion effect of cost reduction 

and the ¥18.3 billion decrease in rental income from 

efforts, and the ¥150.0 billion of favorable impact by 

vehicles and equipment on operating leases.

changes in vehicle unit sales and sales mix.

 
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P a g e  63

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [18 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

  Operating income from ﬁ nancial services opera-

prior ﬁ scal year. This decrease was due primarily to 

result, Toyota expects that operating income will 

operating results. See “Overview—Currency 

tions decreased by ¥51.8 billion, or 14.5%, to 

the recording of ¥20.8 billion of valuation losses on 

increase in ﬁ scal 2014 compared with ﬁ scal 2013. 

Fluctuations” for further discussion.

¥306.4 billion during ﬁ scal 2012 compared with the 

interest rate swaps stated at fair value.

Also, Toyota expects that income before income 

  The foregoing statements are forward-looking 

taxes and equity in earnings of afﬁ liated companies 

statements based upon Toyota’s management’s 

  Ratio of credit loss experience in the United States is as follows:

and net income attributable to Toyota Motor 

assumptions and beliefs regarding exchange rates, 

Years ended March 31,

Corporation will increase in ﬁ scal 2014.

market demand for Toyota’s products, economic 

Net charge-offs as a percentage of average gross earning assets:
  Finance receivables
  Operating lease
  Total

2011

0.61%
0.22
0.52%

2012

0.24%
0.11
0.21%

  For the purposes of this outlook discussion, 

conditions and others. See “Cautionary Statement 

Toyota is assuming an average exchange rate of 

Concerning Forward-Looking Statements”. Toyota’s 

¥90 to the U.S. dollar and ¥120 to the euro. 

actual results of operations could vary signiﬁ cantly 

Exchange rate ﬂ uctuations can materially affect 

from those described above as a result of unantici-

Toyota’s operating results. In particular, a strength-

pated changes in the factors described above or 

All Other Operations Segment

  Operating income from Toyota’s other operations 

ening of the Japanese yen against the U.S. dollar 

other factors, including those described in 

Net revenues for Toyota’s other operations seg-

segments increased by ¥6.8 billion, or 19.4%, to 

can have a material adverse effect on Toyota’s 

“Risk Factors”.

ments increased by ¥76.6 billion, or 7.9%, to 

¥42.0 billion during ﬁ scal 2012 compared with the 

¥1,048.9 billion during ﬁ scal 2012 compared with 

prior ﬁ scal year.

the prior ﬁ scal year.

Outlook

As for our world future business environment, the 

scale. With the foregoing external factors in mind, 

U.S. economy is expected to beneﬁ t from ongoing 

Toyota expects that net revenues for ﬁ scal 2014 will 

moderate recovery and a pickup in the pace of eco-

increase compared with ﬁ scal 2013 as results of a 

nomic expansion in emerging countries. Europe, 

favorable impact of ﬂ uctuations in foreign currency 

meanwhile, still faces the risk of economic stagna-

translation rates and an increase in vehicle unit 

tion due to the sovereign debt crisis and other fac-

sales. With respect to operating income, factors 

tors, though a gradual bottoming out is anticipated.

expected to contribute to an increase in operating 

  The automotive market is expected to see recov-

income include the favorable impact of ﬂ uctuations 

ery in the U.S. and expansion in emerging countries. 

in foreign currency rates, increased vehicle unit 

However, amid the change in market structure, as 

sales through marketing efforts, and cost reduction 

seen in the expansion and diversiﬁ cation of demand 

efforts. On the other hand, factors expected to con-

for eco-cars backed by rising environmental con-

tribute to a decrease in operating income include 

sciousness, ﬁ erce competition exists on a global 

increase in miscellaneous costs and others. As the 

 Liquidity and Capital Resources

Historically, Toyota has funded its capital expenditures and research and development activities through cash 

generated by operations.

Net Cash Provided by 
Operating Activities and 
Free Cash Flow* 
(cid:2)(cid:2) Net cash provided by operating activities
(cid:2)(cid:2) Free cash flow
(¥ Billion)
3,000

2,500

2,000

1,500

1,000

500

0

Capital Expenditures for 
Property, Plant and Equipment* 
and Depreciation 
(cid:2)(cid:2) Capital expenditures   (cid:2)(cid:2) Depreciation

Cash and Cash Equivalents 
at End of Year

(¥ Billion)
1,500

1,200

900

600

300

0

(¥ Billion)
2,500

2,000

1,500

1,000

500

0

’11

FY ’09

’12
’10
* (Net cash provided by operating activities)-
  (Capital expenditures for property, plant and
  equipment, excluding vehicles and
  equipment on operating leases)

’13

FY ’09

’10

’11

’12

’13

FY ’09

’10

’11

’12

’13

* Excluding vehicles and equipment on operating leases 

 
 
 
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P a g e  64

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [19 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

In ﬁ scal 2014, Toyota expects to sufﬁ ciently fund 

¥112.6 billion decrease in operating income, to 

before such ﬁ nancial crisis. The decrease in depre-

  Total capital expenditures for property, plant and 

its capital expenditures and research and develop-

a decline in depreciation expense of ¥107.7 billion 

ciation favorably affected net income while it did not 

equipment, excluding vehicles and equipment on 

ment activities through cash and cash equivalents 

and a reduction in inventory.

affect the net cash provided by operating activities.

operating leases, were ¥854.5 billion during ﬁ scal 

on hand, and cash generated by operations. Toyota 

  Even though other working capital items signiﬁ -

  Net cash used in investing activities increased by 

2013, an increase of 18.1% over the ¥723.5 billion 

will use its funds for the development of environ-

cantly ﬂ uctuated in line with the signiﬁ cant decrease 

¥1,584.6 billion to ¥3,027.3 billion for ﬁ scal 2013, 

in total capital expenditures during the prior ﬁ scal 

ment technologies, maintenance and replacement 

in production and sales in March 2011 due to the 

compared with ¥1,442.6 billion for ﬁ scal 2012. The 

year. This increase was due primarily to an increase 

of manufacturing facilities, and the introduction of 

Great East Japan Earthquake and increase in sales 

increase was primarily attributable to the ¥630.5 bil-

of investments in North America and Asia.

new products. See “Information on the Company—

in the second half of ﬁ scal 2012 due to the recovery 

lion increase in ﬁ nance receivables, to the ¥426.5 

  Total capital expenditures for vehicles and equip-

Business Overview—Capital Expenditures and 

of production levels from the Great East Japan 

billion increase in marketable securities and security 

ment on operating leases were ¥1,119.5 billion dur-

Divestitures” in Toyota’s annual report on Form-20F 

Earthquake, changes in other working capital items 

investments and to the ¥311.0 billion increase in 

ing ﬁ scal 2013, an increase of 38.5% over the 

for information regarding Toyota’s material capital 

largely offset each other such that Toyota believes 

purchases of investments in property.

¥808.5 billion in expenditures from the prior ﬁ scal 

expenditures and divestitures for ﬁ scal 2011, 2012 

the impact of such changes on net cash provided 

  Net cash used in investing activities decreased by 

year. This increase was due to an increase in invest-

and 2013, and information concerning Toyota’s 

by operating activities was not material. The impact 

¥673.6 billion to ¥1,442.6 billion for ﬁ scal 2012, 

ments in the ﬁ nancial services operations.

principal capital expenditures and divestitures cur-

of changes in interest and other items on net cash 

compared with ¥2,116.3 billion for ﬁ scal 2011. The 

  Toyota expects investments in property, plant and 

rently in progress.

provided by operating activities were also not material.

decrease was primarily attributable to the ¥1,248.1 

equipment, excluding vehicles and equipment on 

  Toyota funds its ﬁ nancing programs for custom-

Inventory levels were at comparable levels as 

billion decrease in purchases of marketable securi-

operating leases, to be approximately ¥910.0 billion 

ers and dealers, including loans and leasing pro-

between the ends of ﬁ scal 2010 and 2011; while 

ties and security investments, partially offset by a 

during ﬁ scal 2014.

grams, from both cash generated by operations 

the reduction in sales after the Lehman ﬁ nancial cri-

¥859.3 billion decrease in sales and maturity of 

  Based on currently available information, Toyota 

and borrowings by its sales ﬁ nance subsidiaries. 

sis and other factors kept the inventory level low at 

marketable securities and security investments.

does not expect environmental matters to have a 

Toyota seeks to expand its ability to raise funds 

the end of ﬁ scal 2010, the inventory level at the end 

  Net cash provided by or used in ﬁ nancing activities 

material impact on its ﬁ nancial position, results of 

locally in markets throughout the world by expand-

of ﬁ scal 2011 was approximately equivalent 

increased by ¥832.5 billion to ¥477.2 billion increase 

operations, liquidity or cash ﬂ ows during ﬁ scal 

ing its network of ﬁ nance subsidiaries.

because of the Great East Japan Earthquake and 

for ﬁ scal 2013, compared with ¥355.3 billion decrease 

2014. However, uncertainty exists with respect to 

  Net cash provided by operating activities 

the subsequent downturn in production. However, 

for ﬁ scal 2012. The increase was primarily attribut-

Toyota’s obligations under current and future envi-

increased by ¥998.8 billion to ¥2,451.3 billion for 

the inventory level at the end of ﬁ scal 2012 

able to the ¥796.4 billion increase in proceeds from 

ronment regulations as described in “Information on 

ﬁ scal 2013, compared with ¥1,452.4 billion for ﬁ scal 

increased due to the recovery of production and 

issuance of long-term debt and to the ¥185.4 billion 

the Company—Business Overview—Governmental 

2012. The increase was primarily attributable to the 

sales after the Great East Japan Earthquake. This 

decrease in payments of long-term debt.

Regulation, Environmental and Safety Standards” in 

¥965.2 billion increase in operating income. See 

increase of inventory involved related expenditures 

  Net cash provided by or used in ﬁ nancing activi-

Toyota’s annual report on Form 20-F.

“Results of Operations—Fiscal 2013 Compared 

incurred in producing the inventory, which resulted 

ties decreased by ¥789.6 billion to ¥355.3 billion 

  Cash and cash equivalents were ¥1,718.2 billion 

with Fiscal 2012—Operating income” for further 

in reducing the net cash provided by operating 

decrease for ﬁ scal 2012, compared with ¥434.3 billion 

as of March 31, 2013. Most of Toyota’s cash and 

information regarding the increase in operating income.

activities by ¥396.7 billion.

increase for ﬁ scal 2011. The decrease was primarily 

cash equivalents are held in the Japanese yen or in 

  Net cash provided by operating activities 

  Furthermore, depreciation decreased by ¥107.7 

attributable to the ¥536.6 billion decrease in proceeds 

the U.S. dollars. In addition, time deposits were 

decreased by ¥571.5 billion to ¥1,452.4 billion for 

billion in ﬁ scal 2012 as a result of a reduction of 

from issuance of long-term debt and to the ¥377.9 bil-

¥106.7 billion and marketable securities were 

ﬁ scal 2012, compared with ¥2,024.0 billion for ﬁ scal 

Toyota’s capital expenditures after the Lehman 

lion increase in payments of long-term debt.

¥1,445.6 billion as of March 31, 2013.

2011. The decrease was primarily attributable to the 

ﬁ nancial crisis compared with capital expenditures 

 
 
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P a g e  65

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [20 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Liquid Assets*

Shareholders’ Equity and Equity Ratio
(cid:2)(cid:2) Shareholders’ equity   (cid:3)(cid:3) Equity ratio (Right scale)

(¥ Billion)
7,000

6,000

5,000

4,000

3,000

2,000

1,000

0

(¥ Billion)
15,000

12,500

10,000

7,500

5,000

2,500

0

mainly to the charge for costs related to the settle-

into interest rate swaps. There are no material sea-

ment of the economic loss claims in the consolidat-

sonal variations in Toyota’s borrowings requirements.

ed federal action in the U.S. and the increase of 

  As of March 31, 2013, Toyota’s total interest 

product quality related expenses resulted from the 

bearing debt was 116.3% of Toyota Motor 

weakening of the Japanese yen at the end of ﬁ scal 

Corporation shareholders’ equity, compared with 

2013 against other currencies in comparison to the 

113.8% as of March 31, 2012.

prior ﬁ scal year. Income taxes payable increased 

  The following table provides information for credit 

during ﬁ scal 2013 by ¥22.4 billion, or 16.8%, as a 

rating of Toyota’s short-term borrowing and long-

result of reﬂ ecting ﬂ uctuations in foreign currency 

term debt from rating agencies, Standard & Poor’s 

translation rates.

Ratings Group (S&P), Moody’s Investors Services 

(%)
60

50

40

30

20

10

0

FY ’09

’10

’11

’12

’13

FY

’09

’10

’11

’12

’13

  Toyota’s total borrowings increased during ﬁ scal 

(Moody’s), and Rating and Investment Information, 

* Cash and cash equivalents, time deposits, marketable debt securities and 
  investment in monetary trust funds

2013 by ¥2,126.2 billion, or 17.7%. Toyota’s short-

Inc. (R&I), as of May 31, 2013. A credit rating is not 

term borrowings consist of loans with a weighted-

a recommendation to buy, sell or hold securities. A 

  Liquid assets, which Toyota deﬁ nes as cash and 

follows: in North America 57.6%, in Europe 10.0%, in 

average interest rate of 2.31% and commercial 

credit rating may be subject to withdrawal or revi-

cash equivalents, time deposits, marketable debt 

Japan 9.9%, in Asia 9.5% and in Other 13.0%.

paper with a weighted-average interest rate of 

sion at any time. Each rating should be evaluated 

securities and its investment in monetary trust 

  Marketable securities and other securities invest-

0.52%. Short-term borrowings increased during ﬁ s-

separately of any other rating.

funds, increased during ﬁ scal 2013 by ¥1,043.0 bil-

ments, including those included in current assets, 

cal 2013 by ¥638.8 billion, or 18.5%, to ¥4,089.5 

lion, or 18.1%, to ¥6,804.5 billion.

increased during ﬁ scal 2013 by ¥1,387.6 billion, or 

billion. Toyota’s long-term debt consists of unse-

  Trade accounts and notes receivable, less allow-

26.5%, reﬂ ecting an increase in the fair values of 

cured and secured loans, medium-term notes, 

ance for doubtful accounts decreased during ﬁ scal 

common stocks and purchase of marketable secu-

unsecured notes and long-term capital lease obliga-

Short-term borrowing
Long-term debt

S&P 
A-1+
AA- 

Moody’s 
P-1 
Aa3 

R&I
—
AA+

2013 by ¥28.1 billion, or 1.4%, to ¥1,971.6 billion. 

rities and security investments.

tions with interest rates ranging from 0.00% to 

  Toyota’s unfunded pension liabilities of Japanese 

This decrease was due to a decrease in the volume 

  Property, plant and equipment increased during 

27.30%, and maturity dates ranging from 2013 to 

plans decreased during ﬁ scal 2013 by ¥48.6 billion, 

of sales in the fourth quarter of ﬁ scal 2013.

ﬁ scal 2013 by ¥615.8 billion, or 9.9%, primarily 

2050. The current portion of long-term debt 

or 8.8%, to ¥504.1 billion. On the other hand, the 

Inventories increased during ﬁ scal 2013 by ¥93.5 

reﬂ ecting ﬂ uctuations in foreign currency translation 

increased during ﬁ scal 2013 by ¥191.8 billion, or 

liabilities of foreign plans increased during ﬁ scal 

billion, or 5.8%, to ¥1,715.7 billion. This increase 

rates and the increase in the capital expenditures, 

7.6%, to ¥2,704.4 billion and the non-current por-

2013 by ¥30.1 billion, or 24.4%, to ¥153.9 billion. 

was due mainly to the ﬂ uctuations in foreign curren-

partially offset by the impacts of depreciation charg-

tion increased by ¥1,295.5 billion, or 21.4%, to 

The unfunded amounts will be funded through 

cy translation rates.

es during the year.

¥7,337.8 billion. The increase in total borrowings 

future cash contributions by Toyota or in some 

  Total ﬁ nance receivables, net increased during ﬁ scal 

  Accounts and notes payable decreased during 

resulted from an increase in medium-term notes. As 

cases will be settled on the retirement date of each 

2013 by ¥2,344.0 billion, or 24.1%, to ¥12,061.4 bil-

ﬁ scal 2013 by ¥128.8 billion, or 5.7%. This 

of March 31, 2013, approximately 40% of long-term 

covered employee. The decrease in unfunded pen-

lion. This increase was due mainly to the ﬂ uctuations in 

decrease was due mainly to a decrease in produc-

debt was denominated in the U.S. dollars, 17% in 

sion liabilities of the Japanese plans as of the end of 

foreign currency translation rates and an increase in the 

tion volume in the fourth quarter of ﬁ scal 2013.

the Japanese yen, 13% in the Australian dollars, and 

ﬁ scal 2013 compared with the prior ﬁ scal year end 

number of ﬁ nancing contracts. As of March 31, 2013, 

  Accrued expenses increased during ﬁ scal 2013 

30% in other currencies. Toyota hedges interest rate 

reﬂ ects mainly an increase in pension assets due to 

ﬁ nance receivables were geographically distributed as 

by ¥357.0 billion, or 19.5%. This increase was due 

risk exposure of ﬁ xed-rate borrowings by entering 

rising equity security prices, despite an increase in 

 
ANNUAL REPORT 2013

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P a g e  66

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [21 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

pension beneﬁ t obligations resulted from a decline 

initiatives, capital expenditures and ﬁ nancial services 

  Credit Facilities with Dealers

  Guarantees

in discount rate. On the other hand, the increase in 

operations efﬁ ciently even if earnings are subject to 

Toyota’s ﬁ nancial services operations maintain credit 

Toyota enters into certain guarantee contracts with 

liabilities of foreign plans reﬂ ects the increase in 

short-term ﬂ uctuations. Toyota believes that it main-

facilities with dealers. These credit facilities may be 

its dealers to guarantee customers’ payments of 

pension beneﬁ t obligations resulted from a decline 

tains sufﬁ cient liquidity for its present requirements 

used for business acquisitions, facilities refurbish-

their installment payables that arise from installment 

in discount rate. See note 19 to the consolidated 

and that by maintaining its high credit ratings, it will 

ment, real estate purchases, and working capital 

contracts between customers and Toyota dealers, 

ﬁ nancial statements for further discussion.

continue to be able to access funds from external 

requirements. These loans are typically collateralized 

as and when requested by Toyota dealers. 

  Toyota’s treasury policy is to maintain controls on 

sources in large amounts and at relatively low costs. 

with liens on real estate, vehicle inventory, and/or 

Guarantee periods are set to match the maturity of 

all exposures, to adhere to stringent counterparty credit 

Toyota’s ability to maintain its high credit ratings is 

other dealership assets, as appropriate. Toyota 

installment payments, and as of March 31, 2013, 

standards, and to actively monitor marketplace 

subject to a number of factors, some of which are 

obtains a personal guarantee from the dealer or 

ranged from one month to 35 years. However, they 

exposures. Toyota remains centralized, and is pur-

not within Toyota’s control. These factors include 

corporate guarantee from the dealership when 

are generally shorter than the useful lives of prod-

suing global efﬁ ciency of its ﬁ nancial services opera-

general economic conditions in Japan and the other 

deemed prudent. Although the loans are typically 

ucts sold. Toyota is required to execute its guaran-

tions through Toyota Financial Services Corporation.

major markets in which Toyota does business, as 

collateralized or guaranteed, the value of the under-

tee primarily when customers are unable to make 

  The key element of Toyota’s ﬁ nancial strategy is 

well as Toyota’s successful implementation of its 

lying collateral or guarantees may not be sufﬁ cient 

required payments.

maintaining a strong ﬁ nancial position that will allow 

business strategy.

to cover Toyota’s exposure under such agreements. 

  The maximum potential amount of future pay-

Toyota to fund its research and development 

Off-Balance Sheet Arrangements

Toyota prices the credit facilities according to the 

ments as of March 31, 2013 is ¥1,849.4 billion. 

risks assumed in entering into the credit facility. 

Liabilities for these guarantees of ¥6.5 billion have 

Toyota’s ﬁ nancial services operations also provide 

been provided as of March 31, 2013. Under these 

ﬁ nancing to various multi-franchise dealer organiza-

guarantee contracts, Toyota is entitled to recover 

Toyota uses its securitization program as part of its 

entities and therefore consolidates them. Toyota has 

tions, referred to as dealer groups, often as part of 

any amounts paid by it from the customers whose 

funding through special purpose entities for its 

not entered into any off-balance sheet securitization 

a lending consortium, for wholesale inventory ﬁ nancing, 

obligations it guaranteed.

ﬁ nancial services operations. Toyota is considered 

transactions during ﬁ scal 2013.

the primary beneﬁ ciary of these special purpose 

Lending Commitments

business acquisitions, facilities refurbishment, real 

estate purchases, and working capital requirements. 

Toyota’s outstanding credit facilities with dealers 

totaled ¥1,795.8 billion as of March 31, 2013.

  Credit Facilities with Credit Card Holders

 minimizing credit risks and of appropriately estab-

Toyota’s ﬁ nancial services operations issue credit 

lishing credit limits for each individual credit card 

Contractual Obligations and Commitments

cards to customers. As customary for credit card 

holder, Toyota employs its own risk management 

For information regarding debt obligations, capital 

suppliers for purchases of certain raw materials, 

businesses, Toyota maintains credit facilities with 

policy which includes an analysis of information pro-

lease obligations, operating lease obligations and 

components and services. These arrangements 

holders of credit cards issued by Toyota. These 

vided by ﬁ nancial institutions in alliance with Toyota. 

other obligations, including amounts maturing in 

may contain ﬁ xed/minimum quantity purchase 

facilities are used upon each holder’s requests up to 

Toyota periodically reviews and revises, as appropri-

each of the next ﬁ ve years, see notes 13, 22 and 23 

requirements. Toyota enters into such arrangements 

the limits established on an individual holder’s basis. 

ate, these credit limits. Outstanding credit facilities 

to the consolidated ﬁ nancial statements. In addition, 

to facilitate an adequate supply of these materials 

Although loans made to customers through these 

with credit card holders were ¥245.2 billion as of 

as part of Toyota’s normal business practices, 

and services.

facilities are not secured, for the purposes of 

March 31, 2013.

Toyota enters into long-term arrangements with 

ANNUAL REPORT 2013

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Contents

P a g e  67

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [22 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

  The following tables summarize Toyota’s contractual obligations and commercial commitments as of March 

Related Party Transactions

31, 2013.

Contractual Obligations:
  Short-term borrowings (note 13)

  Loans
  Commercial paper

  Long-term debt* (note 13)

 Estimated amount of interest expense 
  on long-term debt

  Capital lease obligations (note 13)
 Non-cancelable operating lease 
  obligations (note 22)
 Commitments for the purchase of 
  property, plant and other assets (note 23)

  Total

* “Long-term debt” represents future principal payments.

Yen in millions

Payments Due by Period

Total

Less than 
1 year

1 to 3 
years

3 to 5 
years

5 years 
and after

Toyota does not have any signiﬁ cant related party 

note 12 to the consolidated ﬁ nancial statements for 

transactions other than transactions with afﬁ liated 

further discussion.

companies in the ordinary course of business. See 

¥  1,062,233 ¥1,062,233 ¥            — ¥            — ¥            —
—
986,114

3,027,295
10,020,853

—
2,545,775

—
3,788,631

3,027,295
2,700,333

757,581
21,399

220,552
4,095

299,299
4,839

126,644
3,217

111,086
9,248

Legislation Regarding End-of-Life Vehicles

In October 2000, the European Union enforced a 

  (cid:129)  vehicles type-approved and put on the market 

directive that requires member states to promulgate 

after December 15, 2008 shall be re-usable 

regulations implementing the following:

and/or recyclable to a minimum of 85% by 

  (cid:129)  manufacturers shall bear all or a signiﬁ cant part 

weight per vehicle and shall be re-usable and/or 

of the costs for taking back end-of-life vehicles 

recoverable to a minimum of 95% by weight per 

61,877

11,299

17,386

11,701

21,491

put on the market after July 1, 2002 and dis-

vehicle; and

203,901

132,268
¥15,155,139 ¥7,083,777 ¥4,120,057 ¥2,691,098 ¥1,260,207

57,970

9,902

3,761

mantling and recycling those vehicles. 

  (cid:129)  end-of-life vehicles must meet actual re-use of 

Beginning January 1, 2007, this requirement will 

80% and re-use as material or energy of 85%, 

also be applicable to vehicles put on the market 

respectively, of vehicle weight by 2006, rising to 

before July 1, 2002; 

85% and 95%, respectively, by 2015.

  Toyota is unable to make reasonable estimates of 

accordingly such liabilities are excluded from the 

  (cid:129)   manufacturers may not use certain hazardous 

  See note 23 to the consolidated ﬁ nancial state-

the period of cash settlement with respect to liabili-

table above. See note 16 to the consolidated ﬁ nan-

materials in vehicles sold after July 2003; 

ments for further discussion.

ties recognized for uncertain tax beneﬁ ts, and 

cial statements for further discussion.

  Toyota expects to contribute ¥54,094 million domestically and ¥8,688 million overseas to its pension plans 

Recent Accounting Pronouncements in the United States

in ﬁ scal 2014.

Commercial Commitments (note 23):
 Maximum potential exposure to 
   guarantees given in the ordinary 
course of business
  Total Commercial Commitments

Yen in millions

Amount of Commitment Expiration Per Period

Total Amounts 
Committed

Less than 
1 year

1 to 3 
years

3 to 5 
years

5 years 
and after

¥1,849,493
¥1,849,493

¥813,754
¥813,754

¥503,822
¥503,822

¥397,108
¥397,108

¥134,809
¥134,809

In December 2011, FASB issued updated guidance 

accumulated other comprehensive income. This 

of disclosures about offsetting assets and liabilities. 

guidance requires to present, either in a single note 

This guidance requires additional disclosures about 

or parenthetically on the face of the ﬁ nancial state-

gross and net information for assets and liabilities 

ments, the effect of signiﬁ cant amounts reclassiﬁ ed 

including ﬁ nancial instruments eligible for offset in 

out of each component of accumulated other com-

the balance sheets. This guidance is effective for ﬁ s-

prehensive income based on its source. This guid-

cal year beginning on or after January 1, 2013, and 

ance is effective for ﬁ scal year beginning on or after 

for interim period within the ﬁ scal year. Management 

December 15, 2012, and for interim period within 

does not expect this guidance to have a material 

the ﬁ scal year. Management does not expect this 

impact on Toyota’s consolidated ﬁ nancial statements.

guidance to have a material impact on Toyota’s 

In February 2013, FASB issued updated guidance 

consolidated ﬁ nancial statements.

on the presentation of items reclassiﬁ ed out of 

 
 
 
 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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P a g e  68

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [23 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Critical Accounting Estimates

described above, included as a component of cost 

  Factors that may cause a difference between the 

The consolidated ﬁ nancial statements of Toyota are 

amount of warranty costs accrued also contains an 

of sales at the time of vehicle sale. Toyota provides 

amount accrued at the time of vehicle sale and 

prepared in conformity with accounting principles 

estimate of warranty claim recoveries to be received 

for such “liabilities for recalls and other safety mea-

actual payment on individual recalls and other safety 

generally accepted in the United States of America. 

from suppliers. The foregoing evaluations are inher-

sures” at the time of vehicle sales comprehensively 

measures mainly include actual cost of recalls and 

The preparation of these ﬁ nancial statements 

ently uncertain, as they require material estimates 

by aggregate sales of various models in a certain 

safety measures during the period being signiﬁ cantly 

requires the use of estimates, judgments and 

and some products’ warranties extend for several 

period by geographical regions instead of by individ-

different from the accumulated amount of repair 

assumptions that affect the reported amounts of 

years. Consequently, actual warranty costs may dif-

ual models. While there is no difference in the calcu-

cost paid per unit (generally comprised of parts and 

assets and liabilities at the date of the ﬁ nancial 

fer from the estimated amounts and could require 

lation method among geographical regions, Toyota 

labor) and the actual pattern of payment occurrence 

statements and the reported amounts of revenues 

additional warranty provisions. If these factors 

believes it is reasonable to calculate the liabilities by 

during the period being signiﬁ cantly different from 

and expenses during the periods presented. Toyota 

require a signiﬁ cant increase in Toyota’s accrued 

geographical regions because of factors such as 

the pattern of the payment occurrence in the past, 

believes that of its signiﬁ cant accounting policies, 

estimated warranty costs, it would negatively affect 

varying labor costs among geographical regions.

which is considered as part of our estimation pro-

the following may involve a higher degree of judg-

future operating results of the automotive operations.

  The “liabilities for the costs of recalls and other 

cess for future recalls and other safety measures.

ments, estimates and assumptions:

  An estimate of warranty claim accrued for each 

safety measures” recorded in the balance sheet is 

  As described above, in estimating the compre-

ﬁ scal year is calculated based on the estimate of 

calculated by deducting the “accumulated amount 

hensive provision, the actual cost of individual recalls 

   Product Warranties and Recalls and Other 

warranty claim per unit. The estimate of warranty 

of repair cost paid” from the “expected liability for 

and other safety measures is included as a compo-

Safety Measures

claim per unit is calculated by dividing the actual 

the cost of recalls and other safety measures”. As 

nent of the calculation such as the accumulated 

Toyota generally warrants its products against cer-

amounts of warranty claim, net of claim recovery 

such, this liability is evaluated every period based on 

amount of repair cost paid per unit. Thus, an individ-

tain manufacturing and other defects. Provisions for 

cost received from suppliers, by the number of 

new data and are adjusted as appropriate. Toyota 

ual recall announcement generally does not directly 

product warranties are provided for speciﬁ c periods 

sales units for the ﬁ scal year.

calculates these liabilities for units sold in the current 

impact the ﬁ nancial statements when it occurs.

of time and/or usage of the product and vary 

  As the historical recovery amounts received from 

period and each of the past 10 ﬁ scal years, and 

depending upon the nature of the product, the geo-

suppliers is used as a factor in Toyota’s calculation 

aggregates such liabilities in determining the ﬁ nal 

  Allowance for Doubtful Accounts and 

graphic location of the sale and other factors. All 

of estimated accrued warranty cost, the estimated 

 liability amount.

Credit Losses

product warranties are consistent with commercial 

accrued warranty cost may change depending on 

  The “expected liability for the cost of recalls and 

Natures of estimates and assumptions

practices. Toyota includes a provision for estimated 

the average recovery amounts received from suppli-

other safety measures” are calculated by multiplying 

Retail receivables and ﬁ nance lease receivables 

product warranty costs as a component of cost of 

ers in the past. However, Toyota believes that there 

the “sales unit” by the “expected average repair 

consist of retail installment sales contracts secured 

sales at the time the related sale is recognized. The 

is not a signiﬁ cant uncertainty of estimated amounts 

cost per unit”. The “expected average repair cost 

by passenger cars and commercial vehicles. 

accrued warranty costs represent management’s 

based on historical experience regarding recoveries 

per unit” is calculated based on dividing the “accu-

Collectability risks include consumer and dealer 

best estimate at the time of sale of the total costs 

received from suppliers. Toyota may seek recovery 

mulated amount of repair cost paid per unit” by the 

insolvencies and insufﬁ cient collateral values (less 

that Toyota will incur to repair or replace product 

to suppliers over the life of the warranty, and there 

“pattern of payment occurrences”. The “pattern of 

costs to sell) to realize the full carrying values of 

parts that fail while still under warranty. The amount 

are no other signiﬁ cant special terms and conditions 

payment occurrence” represents a ratio that shows 

these receivables. As a matter of policy, Toyota 

of accrued estimated warranty costs is primarily 

including cap on amounts that can be recovered. 

the measure of payment occurrence over 10 years 

maintains an allowance for doubtful accounts and 

based on historical experience of product failures as 

  Toyota accrues for costs of recalls and other 

based on actual payments with regard to units sold 

credit losses representing management’s estimate 

well as current information on repair costs. The 

safety measures, as well as product warranty cost 

within 10 years.

of the amount of asset impairment in the portfolios 

ANNUAL REPORT 2013

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P a g e  69

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [24 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

of ﬁ nance, trade and other receivables. Toyota 

inﬂ uenced by two factors: frequency of occurrence 

determines the allowance for doubtful accounts and 

and expected severity of loss. For evaluation pur-

credit losses based on a systematic, ongoing review 

poses, exposures to credit losses are segmented 

and evaluation performed as part of the credit-risk 

into the two primary categories of “consumer” and 

10 percent change in frequency of occurrence or expected severity of loss

Yen in millions
Effect on the allowance for credit 
losses as of March 31, 2013
¥3,950

evaluation process, historical loss experience, the 

“dealer”. Toyota’s “consumer” category consists of 

  Investment in Operating Leases

exposes Toyota to higher potential losses incurred 

size and composition of the portfolios, current eco-

smaller balances that are homogenous retail receiv-

Natures of estimates and assumptions

at lease termination. Severity of loss is the extent to 

nomic events and conditions, the estimated fair 

ables and ﬁ nance lease receivables. The “dealer” 

Vehicles on operating leases, where Toyota is the 

which the end-of-term fair value of a lease is less 

value and adequacy of collateral, and other perti-

category consists of wholesale and other dealer 

lessor, are valued at cost and depreciated over their 

than its carrying value at lease end.

nent factors. This evaluation is inherently judgmental 

loan receivables. The overall allowance for credit 

estimated useful lives using the straight-line method 

  To the extent that sales incentives remain an inte-

and requires material estimates, including the 

losses is evaluated at least quarterly, considering a 

to their estimated residual values. Toyota utilizes 

gral part of sales promotion, resale prices of used 

amounts and timing of future cash ﬂ ows expected 

variety of assumptions and factors to determine 

industry published information and its own historical 

vehicles and, correspondingly, the fair value of 

to be received, which may be susceptible to signiﬁ -

whether reserves are considered adequate to cover 

experience to determine estimated residual values 

Toyota’s leased vehicles could be subject to down-

cant change. Although management considers the 

probable losses.

for these vehicles. Toyota evaluates the recoverabili-

ward pressure. The extent of the impact this will 

allowance for doubtful accounts and credit losses to 

ty of the carrying values of its leased vehicles for 

have on the end of term residual value depends on 

be adequate based on information currently avail-

Sensitivity analysis

impairment when there are indications of declines in 

the signiﬁ cance of the incentive programs and 

able, additional provisions may be necessary due to 

The level of credit losses, which could signiﬁ cantly 

residual values, and if impaired, Toyota recognizes 

whether they are sustained over a number of peri-

(i) changes in management estimates and assump-

impact Toyota’s results of operations, is inﬂ uenced 

an allowance for losses on its residual values.

ods. This in turn can impact the projection of future 

tions about asset impairments, (ii) information that 

by two factors: frequency of occurrence and 

  Throughout the life of the lease, management 

used vehicle values, adversely impacting the 

indicates changes in expected future cash ﬂ ows, or 

expected severity of loss. The overall allowance for 

performs periodic evaluations of estimated end-of-

expected residual value of the current operating 

(iii) changes in economic and other events and 

credit losses is evaluated at least quarterly, consid-

term fair values to determine whether estimates 

lease portfolio and increasing the provision for resid-

conditions. To the extent that sales incentives 

ering a variety of assumptions and factors to 

used in the determination of the contractual residual 

ual value losses. However, various other factors 

remain an integral part of sales promotion with the 

 determine whether reserves are considered ade-

value are still considered reasonable. Factors affect-

impact used vehicle values and the projection of 

effect of reducing new vehicle prices, resale prices 

quate to cover probable losses. The following table 

ing the estimated residual value at lease maturity 

future residual values, including the supply of and 

of used vehicles and, correspondingly, the collateral 

illustrates the effect of an assumed change in fre-

include, but are not limited to, new vehicle incentive 

demand for used vehicles, interest rates, inﬂ ation, 

value of Toyota’s retail receivables and ﬁ nance lease 

quency of occurrence or expected severity of loss 

programs, new vehicle pricing, used vehicle supply, 

the actual or perceived quality, safety and reliability 

receivables could experience further downward 

mainly in the United States, assuming all other 

projected vehicle return rates, and projected loss 

of vehicles, the general economic outlook, new 

pressure. If these factors require a signiﬁ cant 

assumptions are held consistent respectively. The 

severity. The vehicle return rate represents the num-

vehicle pricing, projected vehicle return rates and 

increase in Toyota’s allowance for doubtful accounts 

table below represents the impact on the allowance 

ber of leased vehicles actually returned at contract 

projected loss severity, which may offset this effect. 

and credit losses, it could negatively affect future 

for credit losses in Toyota’s ﬁ nancial services opera-

maturity as a percentage of the number of lease 

Such factors might adversely affect the results of 

operating results of the ﬁ nancial services operations. 

tions of the change in frequency of occurrence or 

contracts originally scheduled to be mature in the 

operations for ﬁ nancial services due to signiﬁ cant 

The level of credit losses, which has a greater 

expected severity of loss as any change impacts 

same period less lease contracts subject to early 

charges reducing the estimated residual value.

impact on Toyota’s results of operations, is 

most signiﬁ cantly on the ﬁ nancial services operations.

terminations. A higher rate of vehicle returns 

ANNUAL REPORT 2013

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P a g e  70

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [25 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Sensitivity analysis

other assumptions constant. The following table 

and 7.0% overseas are the results of assumptions 

Sensitivity analysis

The following table illustrates the effect of an 

represents the impact on the residual value losses in 

used for the various pension plans in calculating 

The following table illustrates the effects of assumed 

assumed change in the vehicle return rate and end-

Toyota’s ﬁ nancial services operations of the change 

Toyota’s consolidated pension costs for ﬁ scal 2013. 

changes in weighted-average discount rates and 

of-term market values mainly in the United States, 

in vehicle return rate and end-of-term market values 

Also, a weighted-average discount rate of 1.7% 

the weighted-average expected rate of return on 

which Toyota believes are the critical estimates, in 

as those changes have a signiﬁ cant impact on 

domestically and 4.5% overseas is the result of 

plan assets, which Toyota believes are critical esti-

determining the residual value losses, holding all 

ﬁ nancial services operations.

assumption used for the various pension plans in 

mates in determining pension costs and obligations, 

1 percent increase in vehicle return rate
1 percent increase in end-of-term market values

Yen in millions
Effect on the residual value losses over the remaining 
terms of the operating leases on and after April 1, 2013
¥1,035
5,267

calculating Toyota’s consolidated pension obliga-

assuming all other assumptions are consistent.

tions for ﬁ scal 2013.

  Impairment of Long-Lived Assets

accumulated and amortized over future periods 

Toyota periodically reviews the carrying value of its 

and, therefore, generally affect recognized expense 

long-lived assets held and used and assets to be 

in future periods. While management believes that 

disposed of, including intangible assets, when events 

the assumptions used are appropriate, differences 

and circumstances warrant such a review. This 

in actual experience or changes in assumptions 

review is performed using estimates of future cash 

may affect Toyota’s pension costs and obligations.

ﬂ ows. If the carrying value of a long-lived asset is 

  The two most critical assumptions impacting the 

Discount rates
  0.5% decrease
  0.5% increase
Expected rate of return on plan assets
  0.5% decrease
  0.5% increase

Yen in millions

Domestic 

Overseas

Effect on pre-tax 
income for 
the year ended 
March 31, 2014

Effect on 
obligations for 
the year ended 
March 31, 2013

Effect on pre-tax 
income for 
the year ended 
March 31, 2014

Effect on 
obligations for 
the year ended 
March 31, 2013

¥117,113
(108,417)

¥(7,217)
6,984

¥(5,451)
5,451

¥57,956
(52,908)

¥(4,598)
4,365

¥(2,396)
2,396

considered impaired, an impairment charge is 

calculation of pension costs and obligations are the 

  Derivatives and Other Contracts at 

different assumptions may have a material effect on 

recorded for the amount by which the carrying value 

discount rates and the expected rates of returns on 

Fair Value

the estimated fair value amounts.

of the long-lived asset exceeds its fair value. 

plan assets. Toyota determines the discount rates 

Toyota uses derivatives in the normal course of 

Management believes that the estimates of future 

mainly based on the rates of high quality ﬁ xed 

business to manage its exposure to foreign curren-

  Marketable Securities and Investments in 

cash ﬂ ows and fair values are reasonable. However, 

income bonds or ﬁ xed income governmental bonds 

cy exchange rates and interest rates. The account-

Afﬁ liated Companies

changes in estimates of such cash ﬂ ows and fair val-

currently available and expected to be available dur-

ing for derivatives is complex and continues to 

Toyota’s accounting policy is to record a write-down 

ues would affect the evaluations and negatively affect 

ing the period to maturity of the deﬁ ned beneﬁ t pen-

evolve. Toyota estimates the fair value of derivative 

of such investments to net realizable value when a 

future operating results of the automotive operations.

sion plans. Toyota determines the expected rates of 

ﬁ nancial instruments using industry-standard valua-

decline in fair value below the carrying value is 

return for pension assets after considering several 

tion models that require observable inputs including 

 other-than-temporary. In determining if a decline in 

  Pension Costs and Obligations

applicable factors including, the composition of plan 

interest rates and foreign exchange rates, and the 

value is other-than-temporary, Toyota considers the 

Natures of estimates and assumptions

assets held, assumed risks of asset management, 

contractual terms. In other certain cases when mar-

length of time and the extent to which the fair value 

Pension costs and obligations are dependent on 

historical results of the returns on plan assets, 

ket data is not available, key inputs to the fair value 

has been less than the carrying value, the ﬁ nancial 

assumptions used in calculating such amounts. 

Toyota’s principal policy for plan asset management, 

measurement include quotes from counterparties, 

condition and prospects of the company and 

These assumptions include discount rates, beneﬁ ts 

and forecasted market conditions. A weighted- 

and other market data. These estimates are based 

Toyota’s ability and intent to retain its investment in 

earned, interest costs, expected rate of return on 

average discount rate of 2.0% domestically and 

upon valuation methodologies deemed appropriate 

the company for a period of time sufﬁ cient to allow 

plan assets, mortality rates and other factors. Actual 

5.0% overseas and a weighted-average expected 

under the circumstances. However, the use of 

for any anticipated recovery in fair value.

results that differ from the assumptions are 

rate of return on plan assets of 2.5% domestically 

ANNUAL REPORT 2013

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Contents

P a g e  71

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations [26 of 26]   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Management’s Discussion and Analysis of Financial Condition and Results of Operations

  Deferred Tax Assets

a valuation allowance is needed for deferred tax 

exchange rates. The VAR of the combined foreign 

ﬂ uctuate with changes in market interest rates, 

The factors used to assess the likelihood of realiza-

assets which are not more-likely-than-not to 

exchange position represents a potential loss in pre-

while interest rates on other types of assets may lag 

tion of the deferred tax assets are the future reversal 

be realized.

tax earnings that was estimated to be ¥87.9 billion 

behind changes in market rates. Finance receiv-

of existing taxable temporary differences, the future 

  The accounting for deferred tax assets represents 

and ¥99.1 billion at March 31, 2012 and 2013, 

ables are less susceptible to prepayments when 

taxable income and available tax planning strategies 

Toyota’s current best estimate based on all available 

respectively. Based on Toyota’s overall currency 

interest rates change and, as a result, Toyota’s 

that are prudent and feasible. All available evidence, 

evidence. Unanticipated events or changes could 

exposure (including derivative positions), the risk 

model does not address prepayment risk for auto-

both positive and negative, is considered to deter-

result in re-evaluating the realizability of deferred 

during ﬁ scal 2013 to pre-tax cash ﬂ ow from curren-

motive related ﬁ nance receivables. However, in the 

mine whether, based on the weight of that evidence, 

tax assets.

cy movements was on average ¥99.1 billion, with a 

event of a change in interest rates, actual loan pre-

Quantitative and Qualitative Disclosures about Market Risk

high of ¥129.5 billion and a low of ¥78.1 billion.

payments may deviate signiﬁ cantly from the 

  The VAR was estimated by using a Monte Carlo 

assumptions used in the model.

Simulation Method and assumed 95% conﬁ dence level 

on the realization date and a 10-day holding period. 

  Commodity Price Risk

Toyota is exposed to market risk from changes in 

consists of forward foreign currency exchange con-

foreign currency exchange rates, interest rates, cer-

tracts, foreign currency options, interest rate swaps, 

  Interest Rate Risk

Commodity price risk is the possibility of higher or 

lower costs due to changes in the prices of com-

tain commodity and equity security prices. In order 

interest rate currency swap agreements and interest 

Toyota is subject to market risk from exposures to 

modities, such as non-ferrous alloys (e.g., alumi-

to manage the risk arising from changes in foreign 

rate options. Anticipated transactions denominated 

changes in interest rates based on its ﬁ nancing, 

num), precious metals (e.g., palladium, platinum and 

currency exchange rates and interest rates, Toyota 

in foreign currencies that are covered by Toyota’s 

investing and cash management activities. Toyota 

rhodium) and ferrous alloys, which Toyota uses in 

enters into a variety of derivative ﬁ nancial instruments. 

derivative hedging are not included in the market 

enters into various ﬁ nancial instrument transactions 

the production of motor vehicles. Toyota does not 

  A description of Toyota’s accounting policies for 

risk analysis. Although operating leases are not 

to maintain the desired level of exposure to the risk 

use derivative instruments to hedge the price risk 

derivative instruments is included in note 2 to the 

required to be included, Toyota has included these 

of interest rate ﬂ uctuations and to minimize interest 

associated with the purchase of those commodities 

consolidated ﬁ nancial statements and further disclo-

instruments in determining interest rate risk.

expense. The potential decrease in fair value result-

and controls its commodity price risk by holding 

sure is provided in notes 20 and 26 to the consoli-

ing from a hypothetical 100 basis point upward shift 

minimum stock levels.

dated ﬁ nancial statements. 

  Foreign Currency Exchange Rate Risk

in interest rates would be approximately ¥144.2 bil-

  Toyota monitors and manages these ﬁ nancial expo-

Toyota has foreign currency exposures related to 

lion as of March 31, 2012 and ¥208.5 billion as of 

  Equity Price Risk

sures as an integral part of its overall risk management 

buying, selling and ﬁ nancing in currencies other 

March 31, 2013.

Toyota holds investments in various available-for-

program, which recognizes the unpredictability of 

than the local currencies in which it operates. 

  There are certain shortcomings inherent to the 

sale equity securities that are subject to price risk. 

ﬁ nancial markets and seeks to reduce the potential-

Toyota is exposed to foreign currency risk related to 

sensitivity analyses presented. The model assumes 

The fair value of available-for-sale equity securities 

ly adverse effects on Toyota’s operating results. 

future earnings or assets and liabilities that are 

that interest rate changes are instantaneous parallel 

was ¥1,034.3 billion as of March 31, 2012 and 

  The ﬁ nancial instruments included in the market 

exposed due to operating cash ﬂ ows and various 

shifts in the yield curve. However, in reality, changes 

¥1,401.1 billion as of March 31, 2013. The potential 

risk analysis consist of all of Toyota’s cash and cash 

ﬁ nancial instruments that are denominated in foreign 

are rarely instantaneous. Although certain assets 

change in the fair value of these investments, 

equivalents, marketable securities, ﬁ nance receiv-

currencies. Toyota’s most signiﬁ cant foreign curren-

and liabilities may have similar maturities or periods 

assuming a 10% change in prices, would be 

ables, securities investments, long-term and short-

cy exposures relate to the U.S. dollar and the euro.

to repricing, they may not react correspondingly to 

approximately ¥103.4 billion as of March 31, 2012 

term debt and all derivative ﬁ nancial instruments. 

  Toyota uses a value-at-risk analysis (“VAR”) to 

changes in market interest rates. Also, the interest 

and ¥140.1 billion as of March 31, 2013.

Toyota’s portfolio of derivative ﬁ nancial instruments 

evaluate its exposure to changes in foreign currency 

rates on certain types of assets and liabilities may 

ANNUAL REPORT 2013

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Contents

P a g e  72

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements [1 of 6]   

 Notes to Consolidated Financial Statements

Next

Consolidated Balance Sheets

Toyota Motor Corporation
March 31, 2012 and 2013

ASSETS
Current assets
  Cash and cash equivalents
  Time deposits
  Marketable securities

 Trade accounts and notes receivable, less allowance for 
   doubtful accounts of ¥13,004 million in 2012 and 
¥15,875 million ($169 million) in 2013

  Finance receivables, net
  Other receivables

Inventories

  Deferred income taxes
  Prepaid expenses and other current assets

  Total current assets

Yen in millions

2012

2013

 ¥  1,679,200
 80,301
 1,181,070

 ¥  1,718,297
 106,700
 1,445,663

 1,999,827
 4,114,897
408,547
1,622,282
718,687
516,378
12,321,189

 1,971,659
 5,117,660
432,693
1,715,786
749,398
527,034
13,784,890

 U.S. dollars 
in millions

2013

 $  18,270
 1,135
 15,371

 20,964
54,414
4,601
18,243
7,968
5,604
146,570

Noncurrent ﬁ nance receivables, net

5,602,462

6,943,766

73,830

Investments and other assets
  Marketable securities and other securities investments
  Afﬁ liated companies
  Employees receivables
  Other

  Total investments and other assets

4,053,572
1,920,987
56,524
460,851
6,491,934

5,176,582
2,103,283
53,741
569,816
7,903,422

Property, plant and equipment
  Land
  Buildings
  Machinery and equipment
  Vehicles and equipment on operating leases
  Construction in progress

  Total property, plant and equipment, at cost

  Less—Accumulated depreciation

  Total property, plant and equipment, net
  Total assets

1,243,261
3,660,912
9,094,399
2,575,353
275,357
16,849,282
(10,613,902)
6,235,380
¥30,650,965

1,303,611
3,874,279
9,716,180
3,038,011
291,539
18,223,620
(11,372,381)
6,851,239
¥35,483,317

The accompanying notes are an integral part of these consolidated ﬁ nancial statements.

55,041
22,363
571
6,059
84,034

13,861
41,194
103,308
32,302
3,100
193,765
(120,918)
72,847
$377,281

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
  Short-term borrowings
  Current portion of long-term debt
  Accounts payable
  Other payables
  Accrued expenses

Income taxes payable
  Other current liabilities

  Total current liabilities

Long-term liabilities
  Long-term debt
  Accrued pension and severance costs
  Deferred income taxes
  Other long-term liabilities

  Total long-term liabilities

Yen in millions

2012

2013

¥  3,450,649
2,512,620
2,242,583
629,093
1,828,523
133,778
984,328
11,781,574

¥  4,089,528
2,704,428
2,113,778
721,065
2,185,537
156,266
941,918
12,912,520

 U.S. dollars 
in millions

2013

$  43,482
28,755
22,475
7,667
23,238
1,662
10,015
137,294

6,042,277
708,402
908,883
143,351
7,802,913

7,337,824
766,112
1,385,927
308,078
9,797,941

78,020
8,146
14,736
3,276
104,178

Shareholders’ equity

 Toyota Motor Corporation shareholders’ equity 

 Common stock, no par value, 
   authorized: 10,000,000,000 shares in 2012 and 2013; 
issued: 3,447,997,492 shares in 2012 and 2013

  Additional paid-in capital
  Retained earnings
  Accumulated other comprehensive income (loss)

 Treasury stock, at cost, 281,187,739 shares in 2012 and
   280,568,824 shares in 2013

  Total Toyota Motor Corporation shareholders’ equity

Noncontrolling interests

  Total shareholders’ equity

Commitments and contingencies

397,050
550,650
11,917,074
(1,178,833)

(1,135,680)
10,550,261
516,217
11,066,478

397,050
551,040
12,689,206
(356,123)

(1,133,138)
12,148,035
624,821
12,772,856

4,222
5,859
134,920
(3,787)

(12,048)
129,166
6,643
135,809

  Total liabilities and shareholders’ equity

¥30,650,965

¥35,483,317

$377,281

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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P a g e  73

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements [2 of 6]   

 Notes to Consolidated Financial Statements

Next

Consolidated Statements of Income

Toyota Motor Corporation
For the years ended March 31, 2011, 2012 and 2013

Net revenues
  Sales of products
  Financing operations

  Total net revenues

Costs and expenses
  Cost of products sold
  Cost of ﬁ nancing operations
  Selling, general and administrative
  Total costs and expenses

Operating income

Other income (expense)

Interest and dividend income
Interest expense

  Foreign exchange gain, net
  Other income (loss), net

  Total other income (expense)

Income before income taxes and equity in earnings of afﬁ liated companies
Provision for income taxes

Equity in earnings of afﬁ liated companies
Net income

Less: Net income attributable to noncontrolling interests

2013

2013

 U.S. dollars in millions

2011

¥17,820,520
1,173,168
18,993,688

15,985,783
629,543
1,910,083
18,525,409

Yen in millions

2012

¥17,511,916
1,071,737
18,583,653

15,795,918
592,646
1,839,462
18,228,026

¥20,914,150
1,150,042
22,064,192

18,010,569
630,426
2,102,309
20,743,304

468,279

355,627

1,320,888

90,771
(29,318)
14,305
19,253
95,011

563,290
312,821

215,016
465,485

(57,302)

99,865
(22,922)
37,105
(36,802)
77,246

432,873
262,272

197,701
368,302

(84,743)

98,673
(22,967)
5,551
1,504
82,761

1,403,649
551,686

231,519
1,083,482

(121,319)

$222,373
12,228
234,601

191,500
6,703
22,353
220,556

14,045

1,049
(244)
59
16
880

14,925
5,866

2,461
11,520

(1,290)

Net income attributable to Toyota Motor Corporation

¥     408,183

¥     283,559

¥     962,163

$  10,230

Net income attributable to Toyota Motor Corporation per share
  — Basic
  — Diluted

¥       130.17
¥       130.16

Yen

¥         90.21
¥         90.20

¥       303.82
¥       303.78

U.S. dollars

$      3.23
$      3.23

Cash dividends per share

¥         50.00

¥         50.00

¥         90.00

$      0.96

The accompanying notes are an integral part of these consolidated ﬁ nancial statements.

 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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P a g e  74

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements [3 of 6]   

 Notes to Consolidated Financial Statements

Next

Consolidated Statements of Comprehensive Income

Toyota Motor Corporation
For the years ended March 31, 2011, 2012 and 2013

Net income
Other comprehensive income (loss), net of tax
  Foreign currency translation adjustments
  Unrealized gains (losses) on securities, net of reclassiﬁ cation adjustments
  Pension liability adjustments
  Total other comprehensive income (loss)
Comprehensive income
Less: Comprehensive income attributable to noncontrolling interests
Comprehensive income attributable to Toyota Motor Corporation

The accompanying notes are an integral part of these consolidated ﬁ nancial statements.

2011
¥465,485

(299,578)
(27,657)
11,454
(315,781)
149,704
(39,407)
¥110,297

Yen in millions

2012
¥368,302

(93,292)
131,794
(65,110)
(26,608)
341,694
(85,744)
¥255,950

2013
¥1,083,482

461,754
374,209
14,711
850,674
1,934,156
(149,283)
¥1,784,873

 U.S. dollars in millions

2013
$11,520

4,910
3,979
156
9,045
20,565
(1,587)
$18,978

ANNUAL REPORT 2013

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P a g e  75

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements [4 of 6]   

 Notes to Consolidated Financial Statements

Next

Consolidated Statements of Shareholders’ Equity

Toyota Motor Corporation
For the years ended March 31, 2011, 2012 and 2013

Balances at March 31, 2010
Equity transaction with noncontrolling interests and other
Issuance during the year
Comprehensive income
  Net income
  Other comprehensive income (loss)

  Foreign currency translation adjustments

 Unrealized gains (losses) on securities, net of reclassiﬁ cation adjustments

  Pension liability adjustments

  Total comprehensive income
Dividends paid to Toyota Motor Corporation shareholders
Dividends paid to noncontrolling interests
Purchase and reissuance of common stock
Balances at March 31, 2011
Equity transaction with noncontrolling interests and other
Issuance during the year
Comprehensive income
  Net income
  Other comprehensive income (loss)

  Foreign currency translation adjustments
  Unrealized gains (losses) on securities, net of reclassiﬁ cation adjustments
  Pension liability adjustments

  Total comprehensive income
Dividends paid to Toyota Motor Corporation shareholders
Dividends paid to noncontrolling interests
Purchase and reissuance of common stock
Balances at March 31, 2012
Equity transaction with noncontrolling interests and other
Issuance during the year
Comprehensive income
  Net income
  Other comprehensive income (loss)

  Foreign currency translation adjustments
  Unrealized gains (losses) on securities, net of reclassiﬁ cation adjustments
  Pension liability adjustments

  Total comprehensive income
Dividends paid to Toyota Motor Corporation shareholders
Dividends paid to noncontrolling interests
Purchase and reissuance of common stock
Balances at March 31, 2013

The accompanying notes are an integral part of these consolidated ﬁ nancial statements.

Common 
stock
¥397,050

Additional paid-in 
capital
¥501,331
2,310
2,119

Retained 
earnings
¥11,568,602

Yen in millions

Accumulated other 
comprehensive 
income (loss)
¥   (846,835)

Treasury stock, 
at cost
¥(1,260,425)

Total Toyota Motor 
Corporation 
shareholders’ equity
¥10,359,723
2,310
2,119

Noncontrolling 
interests
¥570,720
5,183

Total shareholders’ 
equity
¥10,930,443
7,493
2,119

408,183

408,183

57,302

465,485

(287,613)
(26,058)
15,785

(141,120)

(287,613)
(26,058)
15,785
110,297
(141,120)

¥397,050

¥505,760
43,311
1,483

¥11,835,665
(45,365)

¥(1,144,721)
(6,503)

(958)
¥(1,261,383)
125,819

(958)
¥10,332,371
117,262
1,483

(11,965)
(1,599)
(4,331)
39,407

(27,657)

¥587,653
(119,824)

(299,578)
(27,657)
11,454
149,704
(141,120)
(27,657)
(958)
¥10,920,024
(2,562)
1,483

283,559

283,559

84,743

368,302

(87,729)
129,328
(69,208)

(156,785)

(87,729)
129,328
(69,208)
255,950
(156,785)

¥397,050

96
¥550,650
675

¥11,917,074

¥(1,178,833)

(116)
¥(1,135,680)

(20)
¥10,550,261
675

(5,563)
2,466
4,098
85,744

(37,356)

¥516,217
4,961

(93,292)
131,794
(65,110)
341,694
(156,785)
(37,356)
(20)
¥11,066,478
5,636

962,163

962,163

121,319

1,083,482

434,638
368,507
19,565

(190,008)

434,638
368,507
19,565
1,784,873
(190,008)

¥397,050

(285)
¥551,040

(23)
¥12,689,206

¥   (356,123)

2,542
¥(1,133,138)

2,234
¥12,148,035

27,116
5,702
(4,854)
149,283

(45,640)

¥624,821

461,754
374,209
14,711
1,934,156
(190,008)
(45,640)
2,234
¥12,772,856

 
 
 
 
 
 
 
 
 
 
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P a g e  76

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements [5 of 6]   

 Notes to Consolidated Financial Statements

Next

Consolidated Statements of Shareholders’ Equity (Continued)

Toyota Motor Corporation
For the years ended March 31, 2011, 2012 and 2013

Balances at March 31, 2012
Equity transaction with noncontrolling interests and other
Issuance during the year
Comprehensive income
  Net income
  Other comprehensive income (loss)

  Foreign currency translation adjustments
  Unrealized gains (losses) on securities, net of reclassiﬁ cation adjustments
  Pension liability adjustments

  Total comprehensive income
Dividends paid to Toyota Motor Corporation shareholders
Dividends paid to noncontrolling interests
Purchase and reissuance of common stock
Balances at March 31, 2013

The accompanying notes are an integral part of these consolidated ﬁ nancial statements.

Common 
stock
$4,222

Additional paid-in 
capital
$5,855
7

Retained 
earnings
$126,710

U.S. dollars in millions

Accumulated other 
comprehensive 
income (loss)
$(12,535)

Treasury stock, 
at cost
$(12,075)

Total Toyota Motor 
Corporation 
shareholders’ equity
$112,177
7

Noncontrolling 
interests
$5,489
53

Total shareholders’ 
equity
$117,666
60

10,230

(2,020)

4,622
3,918
208

10,230

4,622
3,918
208
18,978
(2,020)

$4,222

(3)
$5,859

(0)
$134,920

$  (3,787)

27
$(12,048)

24
$129,166

1,290

288
61
(52)
1,587

(486)

$6,643

11,520

4,910
3,979
156
20,565
(2,020)
(486)
24
$135,809

 
 
 
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P a g e  77

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements [6 of 6]   

 Notes to Consolidated Financial Statements

Next

Consolidated Statements of Cash Flows

Toyota Motor Corporation
For the years ended March 31, 2011, 2012 and 2013

Cash ﬂ ows from operating activities
  Net income

 Adjustments to reconcile net income to 
  net cash provided by operating activities
  Depreciation

 Provision for doubtful accounts and 
  credit losses

  Pension and severance costs, less payments
  Losses on disposal of ﬁ xed assets

 Unrealized losses on available-for-sale 
  securities, net

2011 

Yen in millions
2012 

2013 

U.S. dollars 
in millions
2013

¥    465,485

¥    368,302 ¥   1,083,482

$   11,520

1,175,573

1,067,830

1,105,109

11,750

4,140

(23,414)
36,214

7,915

9,623

16,711
33,528

53,831

27,367

(20,429)
32,221

2,104

291

(217)
343

22

  Deferred income taxes
  Equity in earnings of afﬁ liated companies

85,710
(215,016)

6,395
(197,701)

160,008
(231,519)

1,701
(2,461)

 Changes in operating assets and liabilities, 
  and other

421,423

(585,464)

(168,260)

(1,789)

 (Increase) decrease in accounts and 
  notes receivable
(Increase) decrease in inventories
(Increase) decrease in other current assets
Increase (decrease) in accounts payable
Increase (decrease) in accrued income taxes
Increase in other current liabilities

51,808
38,307
(406,210)
(40,629)
239,319
183,384
  Net cash provided by operating activities ¥ 2,024,009

  Other

(344,923)
(180,529)
756,363
20,943
316,366
111,160

50,483
(47,033)
(209,284)
22,127
280,083
364,857
¥ 1,452,435 ¥   2,451,316

537
(500)
(2,225)
235
2,978
3,879
$   26,064

The accompanying notes are an integral part of these consolidated ﬁ nancial statements.

Cash ﬂ ows from investing activities
  Additions to ﬁ nance receivables
  Collection of ﬁ nance receivables
  Proceeds from sales of ﬁ nance receivables

 Additions to ﬁ xed assets excluding equipment
   leased to others

2011 

Yen in millions
2012 

2013 

U.S. dollars 
in millions
2013

¥(8,438,785) ¥(8,333,248) ¥(10,004,928)
9,063,011
8,007,711
39,845
53,999

7,934,364
69,576

$(106,379)
96,364
424

(629,326)

(723,537)

(854,561)

(9,086)

  Additions to equipment leased to others

(1,061,865)

(808,545)

(1,119,591)

(11,904)

 Proceeds from sales of ﬁ xed assets excluding 
  equipment leased to others
 Proceeds from sales of equipment leased 
  to others
 Purchases of marketable securities and 
  security investments
 Proceeds from sales of marketable securities 
  and security investments
 Proceeds upon maturity of marketable 
  securities and security investments
 Payment for additional investments in 
  afﬁ liated companies, net of cash acquired
 Changes in investments and other assets, 
  and other

51,342

36,633

39,191

417

486,695

431,313

533,441

5,672

(4,421,807)

(3,173,634)

(3,412,423)

(36,283)

189,037

162,160

35,178

374

3,527,119

2,694,665

2,633,913

28,005

(299)

(147)

16,216

177,605

209,972

3,396

172

36

  Net cash used in investing activities

(2,116,344)

(1,442,658)

(3,027,312)

(32,188)

Cash ﬂ ows from ﬁ nancing activities
  Proceeds from issuance of long-term debt
  Payments of long-term debt

Increase in short-term borrowings

  Dividends paid
  Purchase of common stock, and other
 Net cash provided by (used in) 
  ﬁ nancing activities

Effect of exchange rate changes on cash and 
  cash equivalents
Net increase (decrease) in cash and 
  cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

2,931,436
(2,489,632)
162,260
(141,120)
(28,617)

2,394,807
(2,867,572)
311,651
(156,785)
(37,448)

3,191,223
(2,682,136)
201,261
(190,008)
(43,098)

33,931
(28,518)
2,139
(2,020)
(458)

434,327

(355,347)

477,242

5,074

(127,029)

(55,939)

137,851

1,466

214,963

(401,509)

39,097

416

1,865,746
¥ 2,080,709

2,080,709

1,679,200
¥ 1,679,200 ¥   1,718,297

17,854
$   18,270

The accompanying notes are an integral part of these consolidated ﬁ nancial statements.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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P a g e  78

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [1 of 44]

Next

Notes to Consolidated Financial Statements

1. Nature of operations

  Translation of foreign currencies

recorded as assets and are depreciated in accor-

All asset and liability accounts of foreign subsidiaries 

dance with Toyota’s depreciation policy.

Toyota is primarily engaged in the design, manufac-

provides ﬁ nancing, vehicle and equipment leasing and 

and afﬁ liated companies are translated into Japanese 

  Revenues from retail ﬁ nancing contracts and 

ture, and sale of sedans, minivans, compact cars, 

certain other ﬁ nancial services primarily to its dealers 

yen at appropriate year-end current exchange rates 

ﬁ nance leases are recognized using the effective yield 

sport-utility vehicles, trucks and related parts and 

and their customers to support the sales of vehicles 

and all income and expense accounts of those sub-

method. Revenues from operating leases are recog-

accessories throughout the world. In addition, Toyota 

and other products manufactured by Toyota.

sidiaries are translated at the average exchange 

nized on a straight-line basis over the lease term.

2. Summary of signiﬁ cant accounting policies

rates for each period. The foreign currency transla-

  The sale of certain vehicles includes a determin-

tion adjustments are included as a component of 

able amount for the contract, which entitles cus-

accumulated other comprehensive income.

tomers to free vehicle maintenance. Such revenues 

  Foreign currency receivables and payables are 

from free maintenance contracts are deferred and 

The parent company and its subsidiaries in Japan 

companies are reduced to net realizable value if 

translated at appropriate year-end current exchange 

recognized as revenue over the period of the 

and its foreign subsidiaries maintain their records 

a decline in market value is determined other-than-

rates and the resulting transaction gains or losses 

 contract, which approximates the pattern of the 

and prepare their ﬁ nancial statements in accor-

temporary. Investments in non-public companies in 

are recorded in operations currently.

related costs.

dance with accounting principles generally accept-

which Toyota does not exercise signiﬁ cant inﬂ uence 

ed in Japan and those of their countries of domicile. 

(generally less than a 20% ownership interest) are 

  Revenue recognition

  Other costs

Certain adjustments and reclassiﬁ cations have been 

stated at cost. The accounts of variable interest 

Revenues from sales of vehicles and parts are gen-

Advertising and sales promotion costs are 

incorporated in the accompanying consolidated 

entities as deﬁ ned by U.S. GAAP are included in the 

erally recognized upon delivery which is considered 

expensed as incurred. Advertising costs were 

ﬁ nancial statements to conform to U.S. GAAP. 

consolidated ﬁ nancial statements, if applicable.

to have occurred when the dealer has taken title to 

¥308,903 million, ¥304,713 million and ¥330,870 

  Signiﬁ cant accounting policies after reﬂ ecting 

the product and the risk and reward of ownership 

million ($3,518 million) for the years ended March 

adjustments for the above are as follows:

  Estimates

have been substantively transferred, except as 

31, 2011, 2012 and 2013, respectively.

The preparation of Toyota’s consolidated ﬁ nancial 

described below.

  Toyota generally warrants its products against 

  Basis of consolidation and accounting for 

statements in conformity with U.S. GAAP requires 

  Toyota’s sales incentive programs principally con-

certain manufacturing and other defects. Provisions 

investments in afﬁ liated companies

management to make estimates and assumptions that 

sist of cash payments to dealers calculated based 

for product warranties are provided for speciﬁ c peri-

The consolidated ﬁ nancial statements include the 

affect the amounts reported in the consolidated ﬁ nan-

on vehicle volume or a model sold by a dealer during 

ods of time and/or usage of the product and vary 

accounts of the parent company and those of its 

cial statements and accompanying notes. Actual 

a certain period of time. Toyota accrues these incen-

depending upon the nature of the product, the geo-

majority-owned subsidiary companies. All signiﬁ cant 

results could differ from those estimates. The more sig-

tives as revenue reductions upon the sale of a vehi-

graphic location of the sale and other factors. 

intercompany transactions and accounts have been 

niﬁ cant estimates include: product warranties, liabilities 

cle corresponding to the program by the amount 

Toyota records a provision for estimated product 

eliminated. Investments in afﬁ liated companies in 

accrued for recalls and other safety measures, allow-

determined in the related incentive program.

warranty costs at the time the related sale is recog-

which Toyota exercises signiﬁ cant inﬂ uence, but 

ance for doubtful accounts and credit losses, residual 

  Revenues from the sales of vehicles under which 

nized based on estimates that Toyota will incur to 

which it does not control, are stated at cost plus 

values for leased assets, impairment of long-lived 

Toyota conditionally guarantees the minimum resale 

repair or replace product parts that fail while under 

equity in undistributed earnings. Consolidated net 

assets, pension costs and obligations, fair value of 

value are recognized on a pro rata basis from the 

warranty. The amount of accrued estimated warran-

income includes Toyota’s equity in current earnings 

derivative ﬁ nancial instruments, other-than-temporary 

date of sale to the ﬁ rst exercise date of the guaran-

ty costs is primarily based on historical experience 

of such companies, after elimination of unrealized 

losses on marketable securities, litigation liabilities and 

tee in a manner similar to operating lease accounting. 

as to product failures as well as current information 

intercompany proﬁ ts. Investments in such 

valuation allowance for deferred tax assets.

The underlying vehicles of these transactions are 

on repair costs. The amount of warranty costs 

ANNUAL REPORT 2013

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P a g e  79

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [2 of 44]

Next

Notes to Consolidated Financial Statements

accrued also contains an estimate of warranty claim 

  Marketable securities

  Finance receivables

Finance lease receivables portfolio segment

recoveries to be received from suppliers.

Marketable securities consist of debt and equity 

Finance receivables recorded on Toyota’s consoli-

Toyota acquires new vehicle lease contracts originated 

In addition to product warranties above, Toyota 

securities. Debt and equity securities designated as 

dated balance sheets are comprised of the unpaid 

primarily through dealers. The contract periods of these 

accrues for costs of recalls and other safety mea-

available-for-sale are carried at fair value with unre-

principal balance, plus accrued interest, less 

primarily range from 2 to 5 years. Lease contracts 

sures based on management’s estimates when it 

alized gains or losses included as a component of 

charge-offs, net of any unearned income and 

acquired must ﬁ rst meet speciﬁ ed credit standards 

is probable a liability has been incurred and the 

accumulated other comprehensive income in share-

deferred origination costs and the allowance for 

after which Toyota assumes ownership of the leased 

amount of loss can be reasonably estimated. Toyota 

holders’ equity, net of applicable taxes. Individual 

credit losses. Deferred origination costs are amor-

vehicle. Toyota is responsible for contract collection 

employs an estimation model, to accrue at the time 

securities classiﬁ ed as available-for-sale are reduced 

tized so as to approximate a level rate of return over 

and administration during the lease period.

of vehicle sale, an amount that represents manage-

to net realizable value for other-than-temporary 

the term of the related contracts.

  Toyota is generally permitted to take possession 

ment’s best estimate of expenses related to future 

declines in market value. In determining if a decline 

  The determination of portfolio segments is based 

of the vehicle upon a default by the lessee. The 

recalls and other safety measures. The estimation 

in value is other-than-temporary, Toyota considers 

primarily on the qualitative consideration of the 

residual value is estimated at the time the vehicle is 

model for recalls and other safety measures takes 

the length of time and the extent to which the fair 

nature of Toyota’s business operations and ﬁ nance 

ﬁ rst leased. Vehicles returned to Toyota at the end 

into account Toyota’s historical experience of recalls 

value has been less than the carrying value, the 

receivables. The three portfolio segments within 

of their leases are sold by auction.

and other safety measures.

ﬁ nancial condition and prospects of the company 

ﬁ nance receivables are as follows:

  Toyota classiﬁ es ﬁ nance lease receivables portfo-

  Litigation liabilities are established to cover proba-

and Toyota’s ability and intent to retain its invest-

lio segment into one class based on common risk 

ble losses on various lawsuits based on the infor-

ment in the company for a period of time sufﬁ cient 

Retail receivables portfolio segment

characteristics associated with the underlying ﬁ nance 

mation currently available. Attorneys’ fees are 

to allow for any anticipated recovery in market value. 

The retail receivables portfolio segment consists of 

receivables and the similarity of the credit risks.

expensed as incurred.

Realized gains and losses, which are determined on 

retail installment sales contracts acquired mainly 

  Research and development costs are expensed 

the average-cost method, are reﬂ ected in the con-

from dealers (“auto loans”) including credit card 

Wholesale and other dealer loan receivables 

as incurred. Research and development costs were 

solidated statements of income when realized.

loans. These contracts acquired must ﬁ rst meet 

portfolio segment

¥730,340 million, ¥779,806 million and ¥807,454 

speciﬁ ed credit standards. Thereafter, Toyota retains 

Toyota provides wholesale ﬁ nancing to qualiﬁ ed 

million ($8,585 million) for the years ended March 

  Security investments in non-public 

responsibility for contract collection and administration.

dealers to ﬁ nance inventories. Toyota acquires 

31, 2011, 2012 and 2013, respectively.

companies

  The contract periods of auto loans primarily 

security interests in vehicles ﬁ nanced at wholesale. 

Security investments in non-public companies are car-

range from 2 to 7 years. Toyota acquires security 

In cases where additional security interests would 

  Cash and cash equivalents

ried at cost as fair value is not readily determinable. If 

interests in the vehicles ﬁ nanced and has the right 

be required, Toyota takes dealership assets or per-

Cash and cash equivalents include all highly liquid 

the value of a non-public security investment is esti-

to repossess vehicles if customers fail to meet their 

sonal assets, or both, as additional security. If a 

investments with original maturities of three months 

mated to have declined and such decline is judged to 

contractual obligations. Almost all auto loans are 

dealer defaults, Toyota has the right to liquidate any 

or less, that are readily convertible to known 

be other-than-temporary, Toyota recognizes the impair-

non-recourse, which relieves the dealers from ﬁ nan-

assets acquired and seek legal remedies.

amounts of cash and are so near maturity that 

ment of the investment and the carrying value is 

cial responsibility in the event of repossession.

  Toyota also makes term loans to dealers for busi-

they present insigniﬁ cant risk of changes in 

reduced to its fair value. Determination of impairment is 

  Toyota classiﬁ es retail receivables portfolio seg-

ness acquisitions, facilities refurbishment, real estate 

value because of changes in interest rates.

based on the consideration of such factors as operat-

ment into one class based on common risk charac-

purchases and working capital requirements. These 

ing results, business plans and estimated future 

teristics associated with the underlying ﬁ nance 

loans are typically secured with liens on real estate, 

cash ﬂ ows. Fair value is determined principally 

receivables, the similarity of the credit risks, and 

other dealership assets and/or personal assets of 

through the use of the latest ﬁ nancial information.

the quantitative materiality.

the dealers.

 
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P a g e  80

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [3 of 44]

Next

Notes to Consolidated Financial Statements

  Toyota classiﬁ es wholesale and other dealer loan 

is 90 days or more contractually past due, whichev-

  As of March 31, 2012 and 2013, ﬁ nance receivables on nonaccrual status were as follows:

receivables portfolio segment into three classes of 

er occurs ﬁ rst. Collateral dependent loans are 

wholesale, real estate and working capital, based 

placed on nonaccrual status if collateral is insufﬁ -

on the risk characteristics associated with the 

cient to cover principal and interest. Interest 

underlying ﬁ nance receivables.

accrued but not collected at the date a receivable is 

  A receivable account balance is considered 

placed on nonaccrual status is reversed against 

impaired when, based on current information and 

interest income. In addition, the amortization of net 

events, it is probable that Toyota will be unable to 

deferred fees is suspended.

collect all amounts due according to the terms of 

Interest income on nonaccrual receivables is rec-

the contract. Factors such as payment history, 

ognized only to the extent it is received in cash. 

Retail
Finance leases
Wholesale
Real estate
Working capital

Yen in millions
March 31, 

2012
¥  2,822
958
5,485
11,736
37
¥21,038

2013
¥  4,443
1,135
1,985
4,354
70
¥11,987

U.S. dollars in millions
March 31,
2013
$  47
12
21
46
1
$127

  As of March 31, 2012 and 2013, ﬁ nance receivables past due over 90 days and still accruing were as 

compliance with terms and conditions of the under-

Accounts are restored to accrual status only when 

follows:

lying loan agreement and other subjective factors 

interest and principal payments are brought current 

related to the ﬁ nancial stability of the borrower are 

and future payments are reasonably assured. 

considered when determining whether a loan is 

Receivable balances are written-off against the 

impaired. Impaired ﬁ nance receivables include cer-

allowance for credit losses when it is probable that 

tain nonaccrual receivables for which a speciﬁ c 

a loss has been realized. Retail receivables class 

reserve has been assessed. An account modiﬁ ed as 

and ﬁ nance lease receivables class are not placed 

a troubled debt restructuring is considered to be 

generally on nonaccrual status when principal or 

Retail
Finance leases

Yen in millions
March 31, 

2012
¥24,263
7,674
¥31,937

2013
¥18,442
3,464
¥21,906

U.S. dollars in millions
March 31,
2013
$196
37
$233

impaired. A troubled debt restructuring occurs when 

interest is 90 days or more past due. However, 

  Allowance for credit losses

accounting guidance governing the disclosure of 

an account is modiﬁ ed through a concession to a 

these receivables are generally written-off against 

Allowance for credit losses is established to cover 

portfolio segments.

borrower experiencing ﬁ nancial difﬁ culty.

the allowance for credit losses when payments 

probable losses on ﬁ nance receivables and vehicles 

  All classes of wholesale and other dealer loan 

due are no longer expected to be received or the 

and equipment on operating leases, resulting from 

Retail receivables portfolio segment

receivables portfolio segment are placed on non-

account is 120 days contractually past due, 

the inability of customers to make required pay-

Toyota calculates allowance for credit losses to 

accrual status when full payment of principal or 

 whichever occurs ﬁ rst.

ments. Provision for credit losses is included in sell-

cover probable losses on retail receivables by apply-

interest is in doubt, or when principal or interest 

ing, general and administrative expenses.

ing reserve rates to such receivables. Reserve rates 

  The allowance for credit losses is based on a sys-

are calculated mainly by historical loss experience, 

tematic, ongoing review and evaluation performed 

current economic events and conditions and other 

as part of the credit-risk evaluation process, histori-

pertinent factors.

cal loss experience, the size and composition of the 

portfolios, current economic events and conditions, 

Finance lease receivables portfolio segment

the estimated fair value and adequacy of collateral 

Toyota calculates allowance for credit losses to 

and other pertinent factors. Vehicles and equipment 

cover probable losses on ﬁ nance lease receivables 

on operating leases are not within the scope of 

by applying reserve rates to such receivables. 

 
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P a g e  81

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [4 of 44]

Next

Notes to Consolidated Financial Statements

Reserve rates are calculated mainly by historical loss 

lease receivables portfolio segments are insigniﬁ cant 

 levels to determine whether reserves are considered 

at rates based on estimated useful lives of the 

experience, current economic events and conditions 

for individual evaluation and Toyota has determined 

adequate to cover the probable range of losses.

respective assets according to general class, type 

and other pertinent factors such as used car markets.

that allowance for credit losses for each of the retail 

  The allowance for residual value losses is main-

of construction and use. The estimated useful lives 

receivables and ﬁ nance lease receivables portfolio 

tained in amounts considered by Toyota to be 

range from 2 to 65 years for buildings and from 2 to 

  Wholesale and other dealer loan 

segments would not be materially different if they 

appropriate in relation to the estimated losses on its 

20 years for machinery and equipment.

receivables portfolio segment

had been individually evaluated for impairment.

owned portfolio. Upon disposal of the assets, the 

  Vehicles and equipment on operating leases to 

Toyota calculates allowance for credit losses to 

  Speciﬁ c reserves on impaired receivables within 

allowance for residual losses is adjusted for the dif-

third parties are originated by dealers and acquired 

cover probable losses on wholesale and other deal-

the wholesale and other dealer loan receivables 

ference between the net book value and the pro-

by certain consolidated subsidiaries. Such subsid-

er loan receivables by applying reserve rates to such 

portfolio segment are recorded by an increase to 

ceeds from sale.

receivables. Reserve rates are calculated mainly by 

the allowance for credit losses based on the related 

ﬁ nancial conditions of the dealers, terms of collateral 

measurement of impairment. Related collateral, if 

  Inventories

iaries are also the lessors of certain property that 

they acquire directly. Vehicles and equipment on 

operating leases are depreciated primarily on a 

setting, current economic events and conditions 

recoverable, is repossessed and sold and the 

Inventories are valued at cost, not in excess of mar-

straight-line method over the lease term, generally 

and other pertinent factors.

account balance is written-off.

ket, cost being determined on the “average-cost” 

from 2 to 5 years, to the estimated residual value. 

  Toyota establishes speciﬁ c reserves to cover the 

  Any shortfall between proceeds received and the 

basis, except for the cost of ﬁ nished products car-

Incremental direct costs incurred in connection with 

estimated losses on individually impaired receivables 

carrying cost of repossessed collateral is charged to 

ried by certain subsidiary companies which is deter-

the acquisition of operating lease contracts are cap-

within the wholesale and other dealer loan receiv-

the allowance. Recoveries are reversed from the 

mined on the “speciﬁ c identiﬁ cation” basis or 

italized and amortized on a straight-line method 

ables portfolio segment. Speciﬁ c reserves on 

allowance for credit losses.

“last-in, ﬁ rst-out” (“LIFO”) basis. Inventories valued 

over the lease term.

impaired receivables are determined by the present 

on the LIFO basis totaled ¥220,582 million and 

value of expected future cash ﬂ ows or the fair value 

  Allowance for residual value losses

¥220,082 million ($2,340 million) at March 31, 2012 

  Long-lived assets

of collateral when it is probable that such receiv-

Toyota is exposed to risk of loss on the disposition 

and 2013, respectively. Had the “ﬁ rst-in, ﬁ rst-out” 

Toyota reviews its long-lived assets for impairment 

ables will be unable to be fully collected. The fair 

of off-lease vehicles to the extent that sales proceeds 

basis been used for those companies using the 

whenever events or changes in circumstances indi-

value of the underlying collateral is used if the receiv-

are not sufﬁ cient to cover the carrying value of the 

LIFO basis, inventories would have been ¥56,799 

cate that the carrying amount of an asset group 

able is collateral-dependent. The receivable is deter-

leased asset at lease termination. Toyota maintains 

million and ¥66,979 million ($712 million) higher than 

may not be recoverable. An impairment loss would 

mined collateral-dependent if the repayment of the 

an allowance to cover probable estimated losses 

reported at March 31, 2012 and 2013, respectively.

be recognized when the carrying amount of an 

loan is expected to be provided by the underlying 

related to unguaranteed residual values on its owned 

asset group exceeds the estimated undiscounted 

collateral. For the receivables in which the fair value 

portfolio. The allowance is evaluated considering 

  Property, plant and equipment

cash ﬂ ows expected to result from the use of the 

of the underlying collateral was in excess of the out-

projected vehicle return rates and projected loss 

Property, plant and equipment are stated at cost. 

asset and its eventual disposition. The amount of 

standing balance, no allowance was provided.

severity. Factors considered in the determination of 

Major renewals and improvements are capitalized; 

the impairment loss to be recorded is calculated by 

  Troubled debt restructurings in the retail receiv-

projected return rates and loss severity include his-

minor replacements, maintenance and repairs are 

the excess of the carrying value of the asset group 

ables and ﬁ nance lease receivables portfolio seg-

torical and market information on used vehicle 

charged to current operations. Depreciation of 

over its fair value. Fair value is determined mainly 

ments are speciﬁ cally identiﬁ ed as impaired and 

sales, trends in lease returns and new car markets, 

property, plant and equipment is mainly computed 

using a discounted cash ﬂ ow valuation method.

aggregated with their respective portfolio segments 

and general economic conditions. Management 

on the declining-balance method for the parent 

when determining the allowance for credit losses. 

evaluates the foregoing factors, develops several 

company and Japanese subsidiaries and on the 

Impaired loans in the retail receivables and ﬁ nance 

potential loss scenarios, and reviews allowance 

straight-line method for foreign subsidiary companies 

ANNUAL REPORT 2013

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P a g e  82

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [5 of 44]

Next

Notes to Consolidated Financial Statements

  Goodwill and intangible assets

Expenditures relating to existing conditions caused 

rates. All derivative ﬁ nancial instruments are record-

  Other comprehensive income

Goodwill is not material to Toyota’s consolidated 

by past operations, which do not contribute to cur-

ed on the consolidated balance sheets at fair value, 

Other comprehensive income refers to revenues, 

balance sheets.

rent or future revenues, are expensed. Liabilities for 

taking into consideration the effects of legally 

expenses, gains and losses that, under U.S. GAAP 

Intangible assets consist mainly of software. 

remediation costs are recorded when they are prob-

enforceable master netting agreements that allow 

are included in comprehensive income, but are 

Intangible assets with a deﬁ nite life are amortized on 

able and reasonably estimable, generally no later 

us to net settle positive and negative positions and 

excluded from net income as these amounts are 

a straight-line basis with estimated useful lives 

than the completion of feasibility studies or Toyota’s 

offset cash collateral held with the same counter-

recorded directly as an adjustment to shareholders’ 

mainly of 5 years. Intangible assets with an indeﬁ nite 

commitment to a plan of action. The cost of each 

party on a net basis. Toyota does not use deriva-

equity. Toyota’s other comprehensive income is pri-

life are tested for impairment whenever events or 

environmental liability is estimated by using current 

tives for speculation or trading purposes. Changes 

marily comprised of unrealized gains/losses on mar-

circumstances indicate that a carrying amount of an 

technology available and various engineering, ﬁ nan-

in the fair value of derivatives are recorded each 

ketable securities designated as available-for-sale, 

asset (asset group) may not be recoverable.

cial and legal specialists within Toyota based on 

period in current earnings or through other compre-

foreign currency translation adjustments and adjust-

  An impairment loss would be recognized when 

current law. Such liabilities do not reﬂ ect any offset 

hensive income, depending on whether a derivative 

ments attributed to pension liabilities associated 

the carrying amount of an asset exceeds the esti-

for possible recoveries from insurance companies 

is designated as part of a hedge transaction and the 

with Toyota’s deﬁ ned beneﬁ t pension plans.

mated undiscounted cash ﬂ ows used in determining 

and are not discounted. There were no material 

type of hedge transaction. The ineffective portion of 

the fair value of the asset. The amount of the impair-

changes in these liabilities for all periods presented.

all hedges is recognized currently in operations.

  Accounting changes

ment loss to be recorded is generally determined by 

In June 2011, FASB issued updated guidance on 

the difference between the fair value of the asset 

  Income taxes

  Net income attributable to Toyota Motor 

the presentation of comprehensive income. This 

using a discounted cash ﬂ ow valuation method and 

The provision for income taxes is computed based 

Corporation per share

guidance requires to present the total of compre-

the current book value.

on the pretax income included in the consolidated 

Basic net income attributable to Toyota Motor 

hensive income, the components of net income, 

statements of income. The asset and liability 

Corporation per common share is calculated by 

and the components of other comprehensive 

  Employee beneﬁ t obligations

approach is used to recognize deferred tax assets 

dividing net income attributable to Toyota Motor 

income either in a single continuous statements of 

Toyota has both deﬁ ned beneﬁ t and deﬁ ned contri-

and liabilities for the expected future tax conse-

Corporation by the weighted-average number of 

comprehensive income or in two separate but con-

bution plans for employees’ retirement beneﬁ ts. 

quences of temporary differences between the car-

shares outstanding during the reported period. 

secutive statements. Toyota adopted this guidance 

Retirement beneﬁ t obligations are measured by 

rying amounts and the tax bases of assets and 

The calculation of diluted net income attributable 

from the interim period within the ﬁ scal year, begun 

actuarial calculations in accordance with U.S. GAAP. 

liabilities. Valuation allowances are recorded to 

to Toyota Motor Corporation per common share 

after December 15, 2011. The adoption of this 

The funded status of the deﬁ ned beneﬁ t postretire-

reduce deferred tax assets when it is more likely 

is similar to the calculation of basic net income 

guidance did not have a material impact on Toyota’s 

ment plans is recognized on the consolidated bal-

than not that a tax beneﬁ t will not be realized.

attributable to Toyota Motor Corporation per share, 

consolidated ﬁ nancial statements.

ance sheets as prepaid pension and severance costs 

except that the weighted-average number of shares 

or accrued pension and severance costs, and the 

  Derivative ﬁ nancial instruments

outstanding includes the additional dilution from the 

  Recent pronouncements to be adopted in 

funded status change is recognized in the year in 

Toyota employs derivative ﬁ nancial instruments, 

assumed exercise of dilutive stock options.

future periods

which it occurs through other comprehensive income.

including forward foreign currency exchange con-

In December 2011, FASB issued updated guidance 

  Environmental matters

interest rate currency swap agreements and interest 

Toyota measures compensation expense for its stock-

This guidance requires additional disclosures about 

Environmental expenditures relating to current oper-

rate options to manage its exposure to ﬂ uctuations 

based compensation plan based on the grant-date fair 

gross and net information for assets and liabilities 

ations are expensed or capitalized as appropriate. 

in interest rates and foreign currency exchange 

value of the award, and accounts for the award.

including ﬁ nancial instruments eligible for offset in 

tracts, foreign currency options, interest rate swaps, 

  Stock-based compensation

of disclosures about offsetting assets and liabilities. 

 
ANNUAL REPORT 2013

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P a g e  83

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [6 of 44]

Next

Notes to Consolidated Financial Statements

the balance sheets. This guidance is effective for ﬁ s-

comprehensive income based on its source. This 

cal year beginning on or after January 1, 2013, and 

guidance is effective for ﬁ scal year beginning on or 

5. Acquisitions and dispositions

for interim period within the ﬁ scal year. Management 

after December 15, 2012, and for interim period 

During the years ended March 31, 2011, 2012 and 

dispositions, however the assets and liabilities 

does not expect this guidance to have a material 

within the ﬁ scal year. Management does not expect 

2013, Toyota made several acquisitions and 

acquired or transferred were not material.

impact on Toyota’s consolidated ﬁ nancial statements.

this guidance to have a material impact on Toyota’s 

In February 2013, FASB issued updated guidance 

consolidated ﬁ nancial statements.

on the presentation of items reclassiﬁ ed out of 

accumulated other comprehensive income. This 

  Reclassiﬁ cations

6. Marketable securities and other securities investments

guidance requires to present, either in a single note 

Certain prior year amounts have been reclassiﬁ ed to 

Marketable securities and other securities investments include public and corporate bonds and common 

or parenthetically on the face of the ﬁ nancial state-

conform to the presentations as of and for the year 

stocks for which the aggregate cost, gross unrealized gains and losses and fair value are as follows:

ments, the effect of signiﬁ cant amounts reclassiﬁ ed 

ended March 31, 2013.

out of each component of accumulated other 

3. U.S. dollar amounts

U.S. dollar amounts presented in the consolidated 

converted into, U.S. dollars. For this purpose, the 

ﬁ nancial statements and related notes are included 

rate of ¥94.05 = U.S. $1, the approximate current 

solely for the convenience of the reader and are 

exchange rate at March 31, 2013, was used for the 

unaudited. These translations should not be con-

translation of the accompanying consolidated ﬁ nan-

strued as representations that the yen amounts 

cial amounts of Toyota as of and for the year ended 

actually represent, or have been or could be 

March 31, 2013.

Available-for-sale:
  Public and corporate bonds
  Common stocks
  Other

  Total

Yen in millions
March 31, 2012

Gross 
unrealized 
gains

Gross 
unrealized 
losses

Cost

¥3,606,290
605,889
449,393
¥4,661,572

¥  74,357
444,073
19,974
¥538,404

¥51,147
15,643
11
¥66,801

Fair value

¥3,629,500
1,034,319
469,356
¥5,133,175

Securities not practicable to determine fair value:
  Public and corporate bonds
  Common stocks

  Total

¥     22,047
79,420
¥   101,467

4. Supplemental cash ﬂ ow information

Cash payments for income taxes were ¥211,487 

  Capital lease obligations of ¥10,478 million, 

million, ¥282,440 million and ¥331,007 million 

¥5,847 million and ¥3,749 million ($40 million) were 

($3,519 million) for the years ended March 31, 2011, 

incurred for the years ended March 31, 2011, 2012 

2012 and 2013, respectively. Interest payments during 

and 2013, respectively.

Available-for-sale:
  Public and corporate bonds
  Common stocks
  Other

  Total

Yen in millions
March 31, 2013

Gross 
unrealized 
gains

Gross 
unrealized 
losses

Cost

¥4,350,942
599,371
537,272
¥5,487,585

¥   211,070
804,405
31,416
¥1,046,891

¥  8,866
2,593
2
¥11,461

Fair value

¥4,553,146
1,401,183
568,686
¥6,523,015

the years ended March 31, 2011, 2012 and 2013 

were ¥382,903 million, ¥365,109 million and 

¥325,575 million ($3,462 million), respectively.

Securities not practicable to determine fair value:
  Public and corporate bonds
  Common stocks

  Total

¥     20,148
79,082
¥     99,230

 
 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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P a g e  84

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [7 of 44]

Next

Notes to Consolidated Financial Statements

Available-for-sale:
  Public and corporate bonds
  Common stocks
  Other

  Total

Securities not practicable to determine fair value:
  Public and corporate bonds
  Common stocks

  Total

Cost

$46,262
6,373
5,713
$58,348

$     214
841
$  1,055

U.S. dollars in millions
March 31, 2013

Gross 
unrealized 
gains

Gross 
unrealized 
losses

$  2,244
8,553
334
$11,131

$  94
28
0
$122

Fair value

$48,412
14,898
6,047
$69,357

  Public and corporate bonds included in available-

those sales, gross realized gains were ¥8,974 mil-

for-sale represent 60% of Japanese bonds, and 

lion, ¥4,822 million and ¥1,048 million ($11 million) 

40% of U.S., European and other bonds as of March 

and gross realized losses were ¥87 million, ¥15 mil-

31, 2012, and 49% of Japanese bonds, and 51% 

lion and ¥31 million ($0 million), respectively.

of U.S., European and other bonds as of March 31, 

  During the years ended March 31, 2011, 2012 

2013. Listed stocks on the Japanese stock markets 

and 2013, Toyota recognized impairment losses on 

represent 83% and 85% of common stocks which 

available-for-sale securities of ¥7,915 million, 

are included in available-for-sale as of March 31, 

¥53,831 million and ¥2,104 million ($22 million), 

2012 and 2013, respectively. Public and corporate 

respectively, which are included in “Other income 

bonds include primarily government bonds, and 

(loss), net” in the accompanying consolidated state-

“Other” includes primarily investment trusts.

ments of income.

  Unrealized losses continuing over a 12 month 

In the ordinary course of business, Toyota main-

period or more in the aggregate were not material at 

tains long-term investment securities, included in 

companies operate to determine if Toyota’s invest-

the impairment is determined to be other-than- 

ment in each individual company is impaired and 

temporary, the carrying value of the investment is 

whether the impairment is other-than-temporary. 

written-down by the impaired amount and the 

Toyota periodically performs this impairment test 

 losses are recognized currently in operations.

for signiﬁ cant investments recorded at cost. If 

7. Finance receivables

Finance receivables consist of the following:

Retail
Finance leases
Wholesale and other dealer loans

Deferred origination costs
Unearned income
Allowance for credit losses
  Retail
  Finance leases
  Wholesale and other dealer loans
  Total allowance for credit losses
  Total ﬁ nance receivables, net

Less—Current portion

  Noncurrent ﬁ nance receivables, net

Yen in millions
March 31, 

2012 
¥  7,248,793
955,430
2,033,954
10,238,177
105,533
(494,123)

(77,353)
(30,637)
(24,238)
(132,228)
9,717,359
(4,114,897)
¥  5,602,462

2013 
¥  9,047,782
1,029,887
2,615,728
12,693,397
135,398
(628,340)

(83,858)
(28,928)
(26,243)
(139,029)
12,061,426
(5,117,660)
¥  6,943,766

U.S. dollars in millions
March 31,
2013
$  96,202
10,950
27,812
134,964
1,439
(6,681)

(892)
(307)
(279)
(1,478)
128,244
(54,414)
$  73,830

March 31, 2012 and 2013.

“Marketable securities and other securities invest-

  Finance receivables were geographically distribut-

12.5% as of March 31, 2012, and in North America 

  As of March 31, 2012 and 2013, maturities of 

ments” and issued by a number of non-public com-

ed as follows: in North America 58.1%, in Japan 

57.6%, in Europe 10.0%, in Japan 9.9%, in Asia 

public and corporate bonds and other included in 

panies which are recorded at cost, as their fair 

12.0%, in Europe 10.3%, in Asia 7.1% and in Other 

9.5% and in Other 13.0% as of March 31, 2013.

available-for-sale are mainly from 1 to 10 years.

values were not readily determinable. Management 

  Proceeds from sales of available-for-sale securi-

employs a systematic methodology to assess the 

ties were ¥189,037 million, ¥162,160 million and 

recoverability of such investments by reviewing the 

¥35,178 million ($374 million) for the years ended 

ﬁ nancial viability of the underlying companies and 

March 31, 2011, 2012 and 2013, respectively. On 

the prevailing market conditions in which these 

 
 
 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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Contents

P a g e  85

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [8 of 44]

Next

Notes to Consolidated Financial Statements

  The contractual maturities of retail receivables, the future minimum lease payments on ﬁ nance leases and 

  The table below shows the amount of the ﬁ nance receivables segregated into aging categories based on 

the contractual maturities of wholesale and other dealer loans at March 31, 2013 are summarized as follows:

the number of days outstanding as of March 31, 2012 and 2013:

Years ending March 31, 
2014
2015
2016
2017
2018
Thereafter

Retail
¥3,032,542
2,218,871
1,721,430
1,127,558
609,255
338,126
¥9,047,782

Yen in millions

Finance leases
¥285,324
192,978
162,639
65,767
29,716
6,447
¥742,871

Wholesale and 
other dealer loans
¥2,040,442
149,091
115,640
125,180
119,497
65,878
¥2,615,728

U.S. dollars in millions

Finance leases
$3,034
2,052
1,729
699
316
69
$7,899

Wholesale and 
other dealer loans
$21,695
1,585
1,230
1,331
1,271
700
$27,812

Retail
$32,244
23,593
18,303
11,989
6,478
3,595
$96,202

  Finance leases consist of the following:

Minimum lease payments
Estimated unguaranteed residual values

Deferred origination costs
Less—Unearned income
Less—Allowance for credit losses

  Finance leases, net

Yen in millions
March 31, 

2012 
¥688,642
266,788
955,430
3,722
(90,887)
(30,637)
¥837,628

2013 
¥   742,871
287,016
1,029,887
3,577
(87,537)
(28,928)
¥   916,999

U.S. dollars in millions
March 31,
2013
$  7,899
3,051
10,950
38
(931)
(307)
$  9,750

  Toyota is exposed to credit risk on Toyota’s 

Toyota or otherwise fail to perform as agreed. 

ﬁ nance receivables. Credit risk is the risk of loss 

Toyota estimates allowance for credit losses by vari-

arising from the failure of customers or dealers to 

ety of credit-risk evaluation process to cover proba-

meet the terms of their contracts with 

ble and estimable losses above.

Current
31-60 days past due
61-90 days past due
Over 90 days past due

  Total

Retail
¥7,146,365
64,314
13,851
24,263
¥7,248,793

Finance leases
¥939,345
5,766
2,645
7,674
¥955,430

Current
31-60 days past due
61-90 days past due
Over 90 days past due

  Total

Retail
¥8,923,588
84,354
17,312
22,528
¥9,047,782

Finance leases
¥1,021,074
3,106
1,661
4,046
¥1,029,887

Yen in millions
March 31, 2012
Wholesale
¥923,642
3
—
53
¥923,698

Yen in millions
March 31, 2013
Wholesale
¥1,305,953
45
—
—
¥1,305,998

Current
31-60 days past due
61-90 days past due
Over 90 days past due

  Total

U.S. dollars in millions
March 31, 2013
Wholesale
$13,886
0
—
—
$13,886

Finance leases
$10,857
33
17
43
$10,950

Retail
$94,881
897
184
240
$96,202

Real estate
¥535,296
—
—
98
¥535,394

Real estate
¥658,114
63
—
—
¥658,177

Real estate
$6,997
1
—
—
$6,998

Working capital
¥574,671
70
—
121
¥574,862

Working capital
¥651,553
—
—
—
¥651,553

Working capital
$6,928
—
—
—
$6,928

 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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Contents

P a g e  86

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [9 of 44]

Next

Notes to Consolidated Financial Statements

  The tables below show the recorded investment 

portfolio segment in the United States and other 

for each credit quality of the ﬁ nance receivable with-

regions as of March 31, 2012 and 2013:

in the wholesale and other dealer loan receivables 

United States

The wholesale and other dealer loan receivables portfolio segment is primarily segregated into credit qualities 

below based on internal risk assessments by dealers. 

Performing
Credit Watch
At Risk
Default

  Total

Wholesale
$7,659
996
33
1
$8,689

U.S. dollars in millions
March 31, 2013

Real estate
$3,968
583
28
1
$4,580

Working capital
$1,616
80
28
2
$1,726

Total
$13,243
1,659
89
4
$14,995

Performing:  

 Account not classiﬁ ed as either Credit Watch, At Risk or Default

Other regions

Credit Watch:  Account designated for elevated attention

Credit qualities of the wholesale and other dealer 

Watch” or “At Risk” were not signiﬁ cant in other 

At Risk:  

 Account where there is an increased likelihood that default may exist based on qualita-

loan receivables portfolio segment in other regions 

regions, and consequently the tables below sum-

tive and quantitative factors

are also monitored based on internal risk assess-

marize information for two categories, “Performing” 

Default:  

 Account is not currently meeting contractual obligations or we have temporarily waived 

ments by dealers on a consistent basis as in the 

and “Default”.

certain contractual requirements

United States. These accounts classiﬁ ed as “Credit 

Performing
Credit Watch
At Risk
Default

  Total

Performing
Credit Watch
At Risk
Default

  Total

Wholesale
¥513,632
55,513
6,394
466
¥576,005

Wholesale
¥720,308
93,643
3,114
106
¥817,171

Yen in millions
March 31, 2012

Real estate
¥307,867
38,382
12,157
30
¥358,436

Working capital
¥116,871
5,014
618
423
¥122,926

Yen in millions
March 31, 2013

Real estate
¥373,176
54,801
2,651
131
¥430,759

Working capital
¥152,048
7,485
2,641
193
¥162,367

Total
¥   938,370
98,909
19,169
919
¥1,057,367

Total
¥1,245,532
155,929
8,406
430
¥1,410,297

Performing
Default

  Total

Performing
Default

  Total

Performing
Default

  Total

Wholesale
¥330,264
17,429
¥347,693

Wholesale
¥485,464
3,363
¥488,827

Wholesale
$5,161
36
$5,197

Yen in millions
March 31, 2012

Real estate
¥170,886
6,072
¥176,958

Working capital
¥451,505
431
¥451,936

Total
¥952,655
23,932
¥976,587

Yen in millions
March 31, 2013

Real estate
¥225,808
1,610
¥227,418

Working capital
¥488,679
507
¥489,186

Total
¥1,199,951
5,480
¥1,205,431

U.S. dollars in millions
March 31, 2013

Real estate
$2,401
17
$2,418

Working capital
$5,196
6
$5,202

Total
$12,758
59
$12,817

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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P a g e  87

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

Notes to Consolidated Financial Statements

  The tables below summarize information about impaired ﬁ nance receivables:

Recorded investment 
March 31, 

Yen in millions
Unpaid principal balance 
March 31, 

Individually evaluated allowance
March 31,

2013

2013

2012

2012

2012
Impaired account balances individually evaluated for impairment with an allowance:
  Wholesale
  Real estate
  Working capital
  Total

¥11,967
6,726
5,246
¥23,939
Impaired account balances individually evaluated for impairment without an allowance:
¥  6,236
  Wholesale
9,165
  Real estate
496
  Working capital
¥15,897
  Total

¥14,015
15
38
¥14,068

¥11,967
6,726
5,246
¥23,939

¥  8,105
16,429
995
¥25,529

¥  8,105
16,429
995
¥25,529

¥  6,236
9,165
496
¥15,897

¥14,015
15
38
¥14,068

¥2,716
4,252
573
¥7,541

2013

¥1,450
1,721
3,691
¥6,862

Impaired account balances aggregated and evaluated for impairment:
  Retail
  Finance leases
  Total

¥42,438
325
¥42,763

¥40,487
103
¥40,590

¥41,790
180
¥41,970

¥39,797
85
¥39,882

Total impaired account balances:
  Retail
  Finance leases
  Wholesale
  Real estate
  Working capital
  Total

¥42,438
325
22,120
16,444
1,033
¥82,360

¥40,487
103
18,203
15,891
5,742
¥80,426

¥41,790
180
22,120
16,444
1,033
¥81,567

¥39,797
85
18,203
15,891
5,742
¥79,718

Total impaired account balances:
  Retail
  Finance leases
  Wholesale
  Real estate
  Working capital
  Total

Yen in millions

Average impaired ﬁ nance receivables 
For the years ended March 31, 

Interest income recognized
For the years ended March 31,

2012

2013

2012

2013

¥44,362
279
18,734
16,137
2,592
¥82,104

¥39,616
161
20,618
15,574
3,820
¥79,789

¥3,700
7
79
395
79
¥4,260

¥3,056
1
166
415
83
¥3,721

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [10 of 44]

Next

U.S. dollars in millions
March 31, 2013

Recorded investment 

Unpaid principal balance 

Individually evaluated 
allowance

Impaired account balances individually evaluated for impairment with an allowance:
  Wholesale
  Real estate
  Working capital
  Total

$127
72
56
$255

$127
72
56
$255

$16
18
39
$73

Impaired account balances individually evaluated for impairment without an allowance:
  Wholesale
  Real estate
  Working capital
  Total

$  67
97
5
$169

$  67
97
5
$169

Impaired account balances aggregated and evaluated for impairment:
  Retail
  Finance leases
  Total

$430
1
$431

$423
1
$424

Total impaired account balances:
  Retail
  Finance leases
  Wholesale
  Real estate
  Working capital
  Total

$430
1
194
169
61
$855

$423
1
194
169
61
$848

Total impaired account balances:
  Retail
  Finance leases
  Wholesale
  Real estate
  Working capital
  Total

U.S. dollars in millions
For the year ended March 31, 2013

Average impaired ﬁ nance 
receivables 

Interest income 
recognized

$421
2
219
165
41
$848

$33
0
2
4
1
$40

  The amount of ﬁ nance receivables modiﬁ ed as 

debt restructurings for the year ended March 31, 2013 

a troubled debt restructuring for the year ended March 

and for which there was a payment default were not 

31, 2013 was not signiﬁ cant for all classes of ﬁ nance 

signiﬁ cant for all classes of such receivables.

receivables. Finance receivables modiﬁ ed as troubled 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [11 of 44]

Next

Notes to Consolidated Financial Statements

8. Other receivables

  Rental income from vehicles and equipment on operating leases was ¥475,472 million, ¥451,361 million 

and ¥476,935 million ($5,071 million) for the years ended March 31, 2011, 2012 and 2013, respectively. 

Other receivables relate to arrangements with cer-

procures inventory for these component manufac-

Future minimum rentals from vehicles and equipment on operating leases are due in installments as follows:

tain component manufacturers whereby Toyota 

tures and is reimbursed for the related purchases.

9. Inventories

Inventories consist of the following:

Finished goods
Raw materials
Work in process
Supplies and other

  Total

Yen in millions
March 31, 

2012 
¥   981,612
347,878
221,036
71,756
¥1,622,282

2013 
¥1,007,659
388,780
235,476
83,871
¥1,715,786

U.S. dollars in millions
March 31,
2013
$10,714
4,134
2,504
891
$18,243

10. Vehicles and equipment on operating leases

Vehicles and equipment on operating leases consist of the following:

Vehicles
Equipment
Less—Deferred income and other

Less—Accumulated depreciation
Less—Allowance for credit losses

  Vehicles and equipment on operating leases, net

Yen in millions
March 31, 

2012 
¥2,536,595
87,848
(49,090)
2,575,353
(667,406)
(8,135)
¥1,899,812

2013 
¥2,999,294
104,351
(65,634)
3,038,011
(749,238)
(8,020)
¥2,280,753

U.S. dollars in millions
March 31,
2013
$31,890
1,110
(698)
32,302
(7,966)
(86)
$24,250

Years ending March 31,
2014
2015
2016
2017
2018
Thereafter

  Total minimum future rentals

 Yen in millions
¥460,685
302,690
140,865
38,042
11,164
4,126
¥957,572

U.S. dollars in millions
$  4,898
3,218
1,498
405
119
44
$10,182

  The future minimum rentals as shown above should not be considered indicative of future cash collections.

11. Allowance for doubtful accounts and credit losses

An analysis of activity within the allowance for doubtful accounts relating to trade accounts and notes receiv-

able for the years ended March 31, 2011, 2012 and 2013 is as follows:

Yen in millions

For the years ended March 31,
2012 

2011 

2013 

U.S. dollars in millions
For the year ended 
March 31,
2013

Allowance for doubtful accounts at beginning 
  of year
Provision for doubtful accounts, net of reversal
Write-offs
Other

 Allowance for doubtful accounts at 
  end of year

¥46,706
1,806
(2,690)
(1,775)

¥44,047
5,843
(699)
(5,094)

¥44,097
1,745
(457)
759

¥44,047

¥44,097

¥46,144

$469
19
(5)
8

$491

  The other amount includes the impact of consoli-

  A portion of the allowance for doubtful accounts 

dation and deconsolidation of certain entities due to 

balance at March 31, 2012 and 2013 totaling 

changes in ownership interest and currency transla-

¥31,093 million and ¥30,269 million ($322 million), 

tion adjustments for the years ended March 31, 

respectively, is attributed to certain non-current 

2011, 2012 and 2013.

receivable balances which are reported as other 

assets in the consolidated balance sheets.

 
 
 
 
 
 
 
 
 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [12 of 44]

Next

Notes to Consolidated Financial Statements

  An analysis of the allowance for credit losses relating to ﬁ nance receivables and vehicles and equipment on 

operating leases for the years ended March 31, 2011, 2012 and 2013 is as follows:

Allowance for credit losses at beginning of year
Provision for credit losses, net of reversal
Charge-offs
Recoveries
Other

  Allowance for credit losses at end of year

Yen in millions

For the years ended March 31,
2012 
¥167,615
3,780
(51,578)
16,415
4,131
¥140,363

2011 
¥232,479
2,334
(86,115)
18,268
649
¥167,615

2013 
¥140,363
25,622
(56,701)
14,690
23,075
¥147,049

U.S. dollars in millions
For the year ended 
March 31,
2013
$1,493
272
(603)
156
246
$1,564

Allowance for credit losses at beginning of year
Provision for credit losses, net of reversal
Charge-offs
Recoveries
Other

  Allowance for credit losses at end of year

U.S. dollars in millions
For the year ended March 31, 2013

Retail
$823
309
(516)
136
140
$892

Finance leases
$326
(43)
(30)
6
48
$307

Wholesale and 
Other dealer loans
$257
(21)
(1)
0
44
$279

  The other amount primarily includes the impact of currency translation adjustments for the years ended 

12. Afﬁ liated companies and variable interest entities

March 31, 2011, 2012 and 2013.

  Investments in and transactions with afﬁ liated companies

  An analysis of the allowance for credit losses above relating to retail receivables portfolio segment, ﬁ nance 

Summarized ﬁ nancial information for afﬁ liated companies accounted for by the equity method is shown below:

lease receivables portfolio segment and wholesale and other dealer loan receivables portfolio segment for the 

years ended March 31, 2012 and 2013 are as follows:

Allowance for credit losses at beginning of year
Provision for credit losses, net of reversal
Charge-offs
Recoveries
Other

  Allowance for credit losses at end of year

Allowance for credit losses at beginning of year
Provision for credit losses, net of reversal
Charge-offs
Recoveries
Other

  Allowance for credit losses at end of year

Yen in millions
For the year ended March 31, 2012

Finance leases
¥36,024
(4,508)
(2,499)
718
902
¥30,637

Wholesale and 
Other dealer loans
¥28,580
(4,767)
(305)
16
714
¥24,238

Yen in millions
For the year ended March 31, 2013

Finance leases
¥30,637
(4,063)
(2,775)
590
4,539
¥28,928

Wholesale and 
Other dealer loans
¥24,238
(2,006)
(110)
3
4,118
¥26,243

Retail
¥92,199
13,569
(44,742)
14,051
2,276
¥77,353

Retail
¥77,353
29,079
(48,528)
12,795
13,159
¥83,858

Current assets
Noncurrent assets
  Total assets

Current liabilities
Long-term liabilities and noncontrolling interests
Afﬁ liated companies accounted for by the equity 
  method shareholders’ equity

  Total liabilities and shareholders’ equity

Toyota’s share of afﬁ liated companies accounted for by 
  the equity method shareholders’ equity
Number of afﬁ liated companies accounted for by 
  the equity method at end of period

Yen in millions
March 31, 

2012 
¥  9,112,895
6,914,208
¥16,027,103
¥  5,847,495
4,032,045

2013 
¥  9,634,769
8,495,078
¥18,129,847
¥  6,366,002
4,541,328

U.S. dollars in millions
March 31,
2013
$102,443
90,325
$192,768
$  67,687
48,286

6,147,563
¥16,027,103

7,222,517
¥18,129,847

76,795
$192,768

¥  1,914,129

¥  2,102,584

$  22,356

57

56

 
 
 
 
 
 
 
 
 
 
 
 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [13 of 44]

Next

Notes to Consolidated Financial Statements

Net revenues
Gross proﬁ t
Net income attributable to afﬁ liated companies 
  accounted for by the equity method
Equity in earnings of afﬁ liated companies 
  attributable to Toyota Motor Corporation

Yen in millions

2011 
¥21,874,143
¥  2,342,706

For the years ended March 31,
2012 
¥22,211,233
¥  2,297,660

2013 
¥24,242,046
¥  2,620,892

U.S. dollars in millions
For the year ended 
March 31,
2013
$257,757
$  27,867

¥     641,771

¥     554,983

¥     705,249

$    7,499

¥     215,016

¥     197,701

¥     231,519

$    2,461

  Entities comprising a signiﬁ cant portion of Toyota’s investment in afﬁ liated companies and percentage of 

  Account balances and transactions with afﬁ liated companies are presented below:

Trade accounts and notes receivable, and other receivables
Accounts payable and other payables

Yen in millions
March 31, 

2012 
¥283,497
707,955

2013 
¥252,708
592,027

Yen in millions

Net revenues
Purchases

2011 
¥1,612,397
3,655,185

For the years ended March 31,
2012 
¥1,536,326
3,785,284

2013 
¥1,926,854
4,020,138

U.S. dollars in millions
March 31,
2013
$2,687
6,295

U.S. dollars in millions
For the year ended 
March 31,
2013
$20,488
42,745

ownership are presented below:

Name of afﬁ liated companies
Denso Corporation
Toyota Industries Corporation
Aisin Seiki Co., Ltd.
Toyota Tsusho Corporation
Toyoda Gosei Co., Ltd.

Percentage of ownership
March 31, 

2012 
24.9%
24.8%
23.4%
22.1%
43.1%

2013 
24.9%
24.8%
23.4%
22.1%
43.0%

  Dividends from afﬁ liated companies accounted 

 signiﬁ cant to the VIEs. As a result, Toyota is consid-

for by the equity method for the years ended March 

ered the primary beneﬁ ciary of the VIEs and there-

31, 2011, 2012 and 2013 were ¥103,169 million, 

fore consolidates the VIEs.

¥122,950 million and ¥126,977 million ($1,350 mil-

  The consolidated securitization VIEs have 

lion), respectively.

¥1,208,136 million in retail ﬁ nance receivables, 

  Toyota does not have any signiﬁ cant related party 

¥65,541 million in restricted cash and ¥1,040,816 

transactions other than transactions with afﬁ liated 

million in secured debt as of March 31, 2012 and 

  Certain afﬁ liated companies accounted for by the 

length of time and the extent to which the quoted 

companies in the ordinary course of business.

have ¥1,135,513 million ($12,074 million) in retail 

equity method with carrying amounts of ¥1,467,575 

market prices have been less than the carrying 

ﬁ nance receivables, ¥41,664 million ($443 million) 

million and ¥1,582,988 million ($16,831 million) at 

amounts, the ﬁ nancial condition and near-term 

  Variable interest entities

in vehicles on operating leases, ¥58,770 million 

March 31, 2012 and 2013, respectively, were quot-

prospects of the afﬁ liated companies and Toyota’s 

Toyota enters into securitization transactions using 

($625 million) in restricted cash and ¥978,095 million 

ed on various established markets at an aggregate 

ability and intent to retain those investments in the 

special-purpose entities, that are considered vari-

($10,400 million) in secured debt as of March 31, 

value of ¥1,477,413 million and ¥1,954,347 million 

companies for a period of time. Toyota did not rec-

able interest entities (“VIEs”). Although the ﬁ nance 

2013. Risks to which Toyota is exposed including 

($20,780 million), respectively. Toyota evaluated its 

ognize any impairment loss for the years ended 

receivables and vehicles on operating leases related 

credit, interest rate, and/or prepayment risks are not 

investments in afﬁ liated companies, considering the 

March 31, 2011, 2012 and 2013.

to securitization transactions have been legally sold 

incremental compared with the situation before 

to the VIEs, Toyota has both the power to direct the 

Toyota enters into securitization transactions.

activities of the VIEs that most signiﬁ cantly impact 

  As for VIEs other than those speciﬁ ed above, 

the VIEs’ economic performance and the obligation 

 neither the aggregate size of these VIEs nor Toyota’s 

to absorb losses of the VIEs or the right to receive 

involvements in these VIEs are material to Toyota’s 

beneﬁ ts from the VIEs that could potentially be 

consolidated ﬁ nancial statements.

ANNUAL REPORT 2013

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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [14 of 44]

Next

Notes to Consolidated Financial Statements

13. Short-term borrowings and long-term debt

  Long-term debt at March 31, 2012 and 2013 comprises the following:

Short-term borrowings at March 31, 2012 and 2013 consist of the following:

Loans, principally from banks, with a weighted-average
    interest at March 31, 2012 and March 31, 2013 of 
1.93% and of 2.31% per annum, respectively

Commercial paper with a weighted-average interest at 
   March 31, 2012 and March 31, 2013 of 0.72% and of 
0.52% per annum, respectively

Yen in millions
March 31, 

2012 

2013 

U.S. dollars in millions
March 31,
2013

¥1,158,556

¥1,062,233

$11,294

2,292,093
¥3,450,649

3,027,295
¥4,089,528

32,188
$43,482

  As of March 31, 2013, Toyota has unused short-

Under these programs, Toyota is authorized to 

term lines of credit amounting to ¥2,063,263 million 

obtain short-term ﬁ nancing at prevailing interest 

($21,938 million) of which ¥455,180 million ($4,840 

rates for periods not in excess of 360 days.

million) related to commercial paper programs. 

Yen in millions
March 31, 

2012 

2013 

U.S. dollars in millions
March 31,
2013

Unsecured loans, representing obligations principally to
   banks, due 2012 to 2029 in 2012 and due 2013 to 
2029 in 2013 with interest ranging from 0.00% to 
32.00% per annum in 2012 and from 0.00% to 
27.30% per annum in 2013
Secured loans, representing obligations principally to 
   ﬁ nance receivables securitization due 2012 to 2050 
in 2012 and due 2013 to 2050 in 2013 with interest 
ranging from 0.37% to 11.23% per annum in 2012 
and from 0.10% to 11.75% per annum in 2013
Medium-term notes of consolidated subsidiaries, due 
   2012 to 2047 in 2012 and due 2013 to 2047 in 2013 
with interest ranging from 0.13% to 8.50% per annum 
in 2012 and from 0.13% to 9.40% per annum in 2013
Unsecured notes of parent company, due 2012 to 
   2019 in 2012 and due 2013 to 2019 in 2013 with 
interest ranging from 1.07% to 3.00% per annum in 
2012 and from 0.19% to 3.00% per annum in 2013
Unsecured notes of consolidated subsidiaries, 
   due 2012 to 2031 in 2012 and due 2013 to 2031 in 
2013 with interest ranging from 0.17% to 24.90% 
per annum in 2012 and from 0.13% to 23.00% 
per annum in 2013
Long-term capital lease obligations, due 2012 to 2030 
   in 2012 and due 2013 to 2030 in 2013 with interest 
ranging from 0.38% to 14.40% per annum in 2012 
and from 0.40% to 14.73% per annum in 2013

Less —Current portion due within one year

¥3,064,785

¥  3,142,411

$  33,412

855,015

993,019

10,558

3,137,289

4,502,787

47,876

530,000

460,000

4,891

946,460

922,636

9,810

21,348
8,554,897
(2,512,620)
¥6,042,277

21,399
10,042,252
(2,704,428)
¥  7,337,824

228
106,775
(28,755)
$  78,020

  As of March 31, 2013, approximately 40%, 17%, 

($976 million) and in addition, other assets aggregating 

13% and 30% of long-term debt are denominated 

¥1,141,199 million ($12,134 million) were pledged 

in U.S. dollars, Japanese yen, Australian dollars and 

as collateral mainly for certain debt obligations of 

other currencies, respectively.

subsidiaries. These other assets principally consist 

  As of March 31, 2013, property, plant and 

of securitized ﬁ nance receivables.

 equipment with a book value of ¥91,834 million 

ANNUAL REPORT 2013

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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [15 of 44]

Next

Notes to Consolidated Financial Statements

  The aggregate amounts of annual maturities of long-term debt during the next ﬁ ve years are as follows:

  The net changes in liabilities for quality assurances above for the years ended March 31, 2011, 2012 and 

Years ending March 31,
2014
2015
2016
2017
2018

 Yen in millions
¥2,704,428
1,703,219
2,090,251
1,207,091
1,341,901

U.S. dollars in millions
$28,755
18,110
22,225
12,835
14,268

  Standard agreements with certain banks in Japan 

indebtedness to such banks. During the year ended 

include provisions that collateral (including sums on 

March 31, 2013, Toyota has not received any signiﬁ -

deposit with such banks) or guarantees will be fur-

cant such requests from these banks.

nished upon the banks’ request and that any collat-

  As of March 31, 2013, Toyota has unused long-

eral furnished, pursuant to such agreements or 

term lines of credit amounting to ¥7,252,081 million 

otherwise, will be applicable to all present or future 

($77,109 million).

14. Product warranties and recalls and other safety measures

2013 consist of the following:

Yen in millions

For the years ended March 31,
2012 

2011 

2013 

U.S. dollars in millions
For the year ended 
March 31,
2013

Liabilities for quality assurances at 
  beginning of year
Payments made during year
Provision for quality assurances
Changes relating to pre-existing 
  quality assurances
Other
Liabilities for quality assurances at end of year

¥680,408
(476,771)
588,224

(1,701)
(25,791)
¥764,369

¥764,369
(348,214)
436,891

(7,827)
(5,385)
¥839,834

¥   839,834
(344,279)
491,542

(8,383)
24,309
¥1,003,023

$  8,930
(3,661)
5,226

(89)
259
$10,665

  The other amount primarily includes the impact of 

consolidation and deconsolidation of certain entities 

currency translation adjustments and the impact of 

due to changes in ownership interest.

  The table below shows the net changes in liabilities for recalls and other safety measures which are com-

Toyota provides product warranties for certain 

  Liabilities for product warranties and liabilities for 

prised in liabilities for quality assurances above for the years ended March 31, 2011, 2012 and 2013.

defects mainly resulting from manufacturing based 

recalls and other safety measures have been com-

on warranty contracts with its customers at the time 

bined into a single table showing an aggregate liabil-

of sale of products. Toyota accrues estimated war-

ity for quality assurances due to the fact that both 

ranty costs to be incurred in the future in accor-

are liabilities for costs to repair or replace defects of 

dance with the warranty contracts. In addition to 

vehicles and the amounts incurred for recalls and 

product warranties, Toyota initiates recalls and other 

other safety measures may affect the amounts 

safety measures to repair or to replace parts which 

incurred for product warranties and vice versa.

might be expected to fail from products safety per-

  Liabilities for quality assurances are included in 

spectives or customer satisfaction standpoints. 

“Accrued expenses” in the consolidated balance 

Toyota accrues for costs of recalls and other safety 

sheets.

measures at the time of vehicle sale based on the 

amount estimated from historical experience.

Yen in millions

For the years ended March 31,
2012 

2011 

2013 

U.S. dollars in millions
For the year ended 
March 31,
2013

Liabilities for recalls and other safety 
  measures at beginning of year
Payments made during year
Provision for recalls and other safety measures
Other
Liabilities for recalls and other safety 
  measures at end of year

¥301,422
(263,096)
356,749
(5,576)

¥389,499
(159,344)
237,907
635

¥468,697
(180,925)
270,883
7,751

$4,984
(1,924)
2,880
82

¥389,499

¥468,697

¥566,406

$6,022

ANNUAL REPORT 2013

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P a g e  93

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [16 of 44]

Next

Notes to Consolidated Financial Statements

15. Other payables

  Toyota is subject to a number of different income taxes which, in the aggregate, indicate a statutory rate in 

Japan of approximately 40.2%, 40.2% and 37.6% for the years ended March 31, 2011, 2012 and 2013, 

Other payables are mainly related to purchases of property, plant and equipment and non-manufacturing purchases.

respectively. The statutory tax rates in effect for the year in which the temporary differences are expected to 

reverse are used to calculate the tax effects of temporary differences which are expected to reverse in the 

future years. Reconciliation of the differences between the statutory tax rate and the effective income tax rate 

16. Income taxes

is as follows:

The components of income (loss) before income taxes comprise the following:

Income (loss) before income taxes:
  Parent company and domestic subsidiaries
  Foreign subsidiaries

Yen in millions

For the years ended March 31,
2012 

2011 

2013 

U.S. dollars in millions
For the year ended 
March 31,
2013

¥(278,229)
841,519
¥ 563,290

¥(177,852)
610,725
¥ 432,873

¥   651,852
751,797
¥1,403,649

$  6,931
7,994
$14,925

  The provision for income taxes consists of the following:

Yen in millions

For the years ended March 31,
2012 

2011 

2013 

U.S. dollars in millions
For the year ended 
March 31,
2013

Current income tax expense:
  Parent company and domestic subsidiaries
  Foreign subsidiaries
  Total current

Deferred income tax expense (beneﬁ t):
  Parent company and domestic subsidiaries
  Foreign subsidiaries

  Total deferred
  Total provision

¥  85,290
141,821
227,111

(44,268)
129,978
85,710
¥312,821

¥111,363
144,514
255,877

(57,940)
64,335
6,395
¥262,272

¥178,662
213,016
391,678

140,041
19,967
160,008
¥551,686

$1,900
2,265
4,165

1,489
212
1,701
$5,866

Statutory tax rate
Increase (reduction) in taxes resulting from:
  Non-deductible expenses

 Deferred tax liabilities on undistributed earnings of 
  foreign subsidiaries
 Deferred tax liabilities on undistributed earnings of afﬁ liated 
  companies accounted for by the equity method

  Valuation allowance
  Tax credits

 The difference between the statutory tax rate in Japan and 
  that of foreign subsidiaries

  Unrecognized tax beneﬁ ts adjustments
  Other
Effective income tax rate

For the years ended March 31,
2012 
40.2%

2011 
40.2%

2013 
37.6%

2.2

4.8

12.6
8.1
(2.6)

(9.3)
(0.6)
0.1
55.5%

1.7

4.7

9.2
14.9
(1.8)

(9.6)
2.5
(1.2)
60.6%

0.6

1.8

4.1
1.7
(3.1)

(4.8)
0.1
1.3
39.3%

 
 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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P a g e  94

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [17 of 44]

Next

Notes to Consolidated Financial Statements

  Signiﬁ cant components of deferred tax assets and liabilities are as follows:

  The factors used to assess the likelihood of realiza-

  Operating loss carryforwards for tax purposes as 

Yen in millions
March 31, 

2012 

2013 

U.S. dollars in millions
March 31,
2013

Deferred tax assets:
  Accrued pension and severance costs
  Accrued expenses and liabilities for quality assurances
  Other accrued employees’ compensation
  Operating loss carryforwards for tax purposes
  Tax credit carryforwards
  Property, plant and equipment and other assets
  Other

  Gross deferred tax assets

  Less—Valuation allowance

  Total deferred tax assets

Deferred tax liabilities:
  Unrealized gains on securities
  Undistributed earnings of foreign subsidiaries

 Undistributed earnings of afﬁ liated companies 
  accounted for by the equity method

  Basis difference of acquired assets
  Lease transactions
  Other

  Gross deferred tax liabilities
  Net deferred tax liability

¥   236,978
369,985
106,265
337,992
108,426
147,906
296,934
1,604,486
(309,268)
1,295,218

¥   230,021
480,428
108,599
160,936
101,251
151,043
227,596
1,459,874
(284,835)
1,175,039

(210,475)
(27,581)

(388,901)
(25,713)

(504,776)
(34,120)
(576,809)
(54,749)
(1,408,510)
¥  (113,292)

(567,054)
(35,647)
(650,389)
(66,923)
(1,734,627)
¥  (559,588)

$  2,446
5,108
1,155
1,711
1,076
1,606
2,420
15,522
(3,028)
12,494

(4,135)
(274)

(6,029)
(379)
(6,915)
(712)
(18,444)
$ (5,950)

  The deferred tax assets and liabilities above that comprise the net deferred tax liability are included in the 

consolidated balance sheets as follows:

Deferred tax assets:
  Deferred income taxes (Current assets)
Investments and other assets—Other

Deferred tax liabilities:
  Other current liabilities
  Deferred income taxes (Long-term liabilities)

  Net deferred tax liability

Yen in millions
March 31, 

2012 

2013 

U.S. dollars in millions
March 31,
2013

¥ 718,687
91,857

¥   749,398
100,199

(14,953)
(908,883)
¥(113,292)

(23,258)
(1,385,927)
¥  (559,588)

$  7,968
1,065

(247)
(14,736)
$ (5,950)

tion of the deferred tax assets are the future reversal 

of March 31, 2013 in Japan and foreign countries 

of existing taxable temporary differences, the future 

were ¥76,280 million ($811 million) and ¥422,133 

taxable income and available tax planning strategies 

million ($4,488 million), respectively, and are avail-

that are prudent and feasible. All available evidence, 

able as an offset against future taxable income. The 

both positive and negative, is considered to deter-

majority of these carryforwards in Japan and foreign 

mine whether, based on the weight of that evidence, 

countries expire in years 2014 to 2022 and expire in 

a valuation allowance is needed for deferred tax assets 

years 2014 to 2033, respectively. Tax credit carry-

which are not more-likely-than-not to be realized.

forwards as of March 31, 2013 in Japan and foreign 

  The accounting for deferred tax assets represents 

countries were ¥90,439 million ($961 million) and 

Toyota’s current best estimate based on all available 

¥10,812 million ($115 million), respectively, and the 

evidence. Unanticipated events or changes could 

majority of these carryforwards in Japan and foreign 

result in re-evaluating the realizability of deferred 

countries expire in years 2014 to 2016 and expire in 

tax assets.

years 2014 to 2033, respectively.

  The valuation allowance mainly relates to deferred tax assets of operating loss and foreign tax credit carry-

forwards for tax purposes that are not expected to be realized. The net changes in the total valuation allow-

ance for deferred tax assets for the years ended March 31, 2011, 2012 and 2013 consist of the following:

Valuation allowance at beginning of year
  Additions
  Deductions
  Other
Valuation allowance at end of year

Yen in millions

For the years ended March 31,
2012 
¥280,685
96,754
(65,566)
(2,605)
¥309,268

2011 
¥239,269
55,791
(10,077)
(4,298)
¥280,685

2013 
¥309,268
38,285
(70,986)
8,268
¥284,835

U.S. dollars in millions
For the year ended 
March 31,
2013
$3,288
407
(755)
88
$3,028

  The other amount includes the impact of consoli-

management has made no provision for income 

dation and deconsolidation of certain entities due to 

taxes on those undistributed earnings aggregating 

changes in ownership interest and currency transla-

¥2,718,554 million ($28,905 million) as of March 31, 

tion adjustments during the years ended March 31, 

2013. Toyota estimates an additional tax provision 

2011, 2012 and 2013.

of ¥118,998 million ($1,265 million) would be 

  Because management intends to reinvest undis-

required if the full amount of those undistributed 

tributed earnings of foreign subsidiaries to the extent 

earnings were remitted.

not expected to be remitted in the foreseeable future, 

 
 
 
 
 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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P a g e  95

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [18 of 44]

Next

Notes to Consolidated Financial Statements

  A summary of the gross unrecognized tax beneﬁ ts changes for the years ended March 31, 2011, 2012 and 

17. Shareholders’ equity

2013 is as follows:

Balance at beginning of year
Additions based on tax positions related to 
  the current year
Additions for tax positions of prior years
Reductions for tax positions of prior years
Reductions for tax positions related to lapse 
  of statute of limitations
Reductions for settlements
Other

  Balance at end of year

Yen in millions

For the years ended March 31,
2012 
¥15,453

2011 
¥23,965

2013 
¥16,901

U.S. dollars in millions
For the year ended 
March 31,
2013
$180

213
12,564
(16,133)

—
(2,794)
(2,362)
¥15,453

4,187
10,801
(363)

—
(12,820)
(357)
¥16,901

2,401
4,339
(1,619)

—
(2,776)
3,201
¥22,447

26
46
(17)

—
(30)
34
$239

Changes in the number of shares of common stock issued have resulted from the following:

Common stock issued:
  Balance at beginning of year
Issuance during the year
  Purchase and retirement

  Balance at end of year

2011 

For the years ended March 31,
2012 

2013 

3,447,997,492
—
—
3,447,997,492

3,447,997,492
—
—
3,447,997,492

3,447,997,492
—
—
3,447,997,492

  The Companies Act provides that an amount 

customary practice in Japan, the distributions from 

equal to 10% of distributions from surplus paid by 

surplus are not accrued in the ﬁ nancial statements 

the parent company and its Japanese subsidiaries 

for the corresponding period, but are recorded in 

be appropriated as a capital reserve or a retained 

the subsequent accounting period after sharehold-

  The amount of unrecognized tax beneﬁ ts that, if 

amounts of interest and penalties accrued as of and 

earnings reserve. No further appropriations are 

ers’ approval has been obtained. Retained earnings 

recognized, would affect the effective tax rate was 

recognized for the years ended March 31, 2011, 

required when the total amount of the capital 

at March 31, 2013 include amounts representing 

not material at March 31, 2011, 2012 and 2013, 

2012 and 2013, respectively, were not material.

reserve and the retained earnings reserve reaches 

year-end cash dividends of ¥190,046 million 

respectively. Toyota does not believe it is reasonably 

  Toyota remains subject to income tax examina-

25% of stated capital.

($2,020 million), ¥60 ($0.64) per share, which were 

possible that the total amounts of unrecognized tax 

tion for the tax returns related to the years beginning 

  The retained earnings reserve included in retained 

approved at the Ordinary General Shareholders’ 

beneﬁ ts will signiﬁ cantly increase or decrease within 

on and after April 1, 2006 and January 1, 2000, 

earnings as of March 31, 2012 and 2013 was 

Meeting, held on June 14, 2013.

the next twelve months.

with various tax jurisdictions in Japan and foreign 

¥173,711 million and ¥175,735 million ($1,869 mil-

  Retained earnings at March 31, 2013 include 

Interest and penalties related to income tax liabili-

countries, respectively.

lion), respectively. The Companies Act provides that 

¥1,576,055 million ($16,758 million) relating to equi-

ties are included in “Other income (loss), net”. The 

the retained earnings reserve of the parent company 

ty in undistributed earnings of afﬁ liated companies 

and its Japanese subsidiaries is restricted and 

accounted for by the equity method.

unable to be used for dividend payments, and is 

  On January 1, 2012, the parent company imple-

excluded from the calculation of the proﬁ t available 

mented share exchanges as a result of which the 

for dividend.

parent company became a wholly-owning parent 

  The amounts of statutory retained earnings of the 

company and each of Toyota Auto Body Co., Ltd. 

parent company available for dividend payments to 

and Kanto Auto Works, Ltd. became a wholly-

shareholders were ¥5,348,279 million and 

owned subsidiary, and the parent company 

¥5,858,551 million ($62,292 million) as of March 31, 

acquired additional shares of each subsidiary. As 

2012 and 2013, respectively. In accordance with 

a˛result of these share exchanges, the parent 

 
 
 
 
 
 
ANNUAL REPORT 2013

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P a g e  96

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [19 of 44]

Next

Notes to Consolidated Financial Statements

company issued 31,151,148 shares of treasury 

¥45,365 million, respectively. As a result of acquiring 

  Tax effects allocated to each component of other comprehensive income (loss) for the years ended March 

stock, and treasury stock decreased by ¥125,819 

additional shares of each subsidiary, noncontrolling 

31, 2011, 2012 and 2013 are as follows:

million and losses on disposal of treasury stock 

interests decreased by ¥117,881 million, accumu-

occurred in the amount of ¥45,916 million. As a 

lated other comprehensive income (loss) decreased 

result, additional paid-in capital decreased by 

by ¥6,503 million and additional paid-in capital 

¥551 million and retained earnings decreased by 

increased by ¥44,481 million.

For the year ended March 31, 2011
  Foreign currency translation adjustments
  Unrealized gains (losses) on securities:

Pre-tax amount

Yen in millions
Tax amount

Net-of-tax amount

¥  (294,279)

¥     6,666

¥(287,613)

  Detailed components of accumulated other comprehensive income (loss) in Toyota Motor Corporation 

shareholders’ equity at March 31, 2012 and 2013 and the related changes, net of taxes for the years ended 

March 31, 2011, 2012 and 2013 consist of the following:

Balances at March 31, 2010
Other comprehensive income (loss)
Balances at March 31, 2011
Equity transaction with noncontrolling 
  interests and other
Other comprehensive income (loss)
Balances at March 31, 2012
Other comprehensive income (loss)
Balances at March 31, 2013

Balances at March 31, 2012
Other comprehensive income (loss)
Balances at March 31, 2013

Yen in millions

Foreign currency 
translation 
adjustments
¥  (872,776)
(287,613)
(1,160,389)

Unrealized gains 
(losses) on 
securities
¥194,285
(26,058)
168,227

—
(87,729)
(1,248,118)
434,638
¥  (813,480)

751
129,328
298,306
368,507
¥666,813

Pension 
liability 
adjustments
¥(168,344)
15,785
(152,559)

(7,254)
(69,208)
(229,021)
19,565
¥(209,456)

Accumulated other 
comprehensive 
income (loss)
¥  (846,835)
(297,886)
(1,144,721)

(6,503)
(27,609)
(1,178,833)
822,710
¥  (356,123)

U.S. dollars in millions

Foreign currency 
translation 
adjustments
$(13,271)
4,622
$  (8,649)

Unrealized gains 
(losses) on 
securities
$3,171
3,918
$7,089

Pension 
liability 
adjustments
$(2,435)
208
$(2,227)

Accumulated other 
comprehensive 
income (loss)
$(12,535)
8,748
$  (3,787)

  Unrealized net holding gains (losses) arising for the year

(31,899)

9,643

(22,256)

 Less: reclassiﬁ cation adjustments for (gains) losses included  
  in net income attributable to Toyota Motor Corporation

  Pension liability adjustments

  Other comprehensive income (loss)

For the year ended March 31, 2012
  Equity transaction with noncontrolling interests and other
  Foreign currency translation adjustments
  Unrealized gains (losses) on securities:

(6,358)
26,681
¥  (305,855)

2,556
(10,896)
¥     7,969

(3,802)
15,785
¥(297,886)

¥    (10,874)
(95,677)

¥     4,371
7,948

¥    (6,503)
(87,729)

  Unrealized net holding gains (losses) arising for the year

164,872

(65,642)

99,230

 Less: reclassiﬁ cation adjustments for (gains) losses included  
  in net income attributable to Toyota Motor Corporation

  Pension liability adjustments

  Other comprehensive income (loss)

For the year ended March 31, 2013
  Foreign currency translation adjustments
  Unrealized gains (losses) on securities:

50,332
(111,722)
¥      (3,069)

(20,234)
42,514
¥  (31,043)

30,098
(69,208)
¥  (34,112)

¥   447,302

¥  (12,664)

¥ 434,638

  Unrealized net holding gains (losses) arising for the year

517,169

(175,839)

341,330

 Less: reclassiﬁ cation adjustments for (gains) losses included 
  in net income attributable to Toyota Motor Corporation

  Pension liability adjustments

  Other comprehensive income (loss)

For the year ended March 31, 2013
  Foreign currency translation adjustments
  Unrealized gains (losses) on securities:

45,253
30,232
¥1,039,956

(18,076)
(10,667)
¥(217,246)

27,177
19,565
¥ 822,710

Pre-tax amount

U.S. dollars in millions
Tax amount

Net-of-tax amount

$  4,756

$   (134)

$4,622

  Unrealized net holding gains (losses) arising for the year

5,499

(1,870)

3,629

 Less: reclassiﬁ cation adjustments for (gains) losses included  
  in net income attributable to Toyota Motor Corporation

  Pension liability adjustments

  Other comprehensive income (loss)

481
321
$11,057

(192)
(113)
$(2,309)

289
208
$8,748

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ANNUAL REPORT 2013

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Contents

P a g e  97

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [20 of 44]

Next

Notes to Consolidated Financial Statements

18. Stock-based compensation

  The following table summarizes Toyota’s stock option activity:

In June 1997, the parent company’s shareholders 

  For the years ended March 31, 2011, 2012 and 

approved a stock option plan for board members. 

2013, Toyota recognized stock-based compensa-

In June 2001, the shareholders approved an 

tion expenses for stock options of ¥2,522 million, 

amendment of the plan to include both board mem-

¥1,539 million and ¥325 million ($3 million) as sell-

bers and key employees. Each year until June 

ing, general and administrative expenses.

2010, since the plans’ inception, the shareholders 

  The weighted-average grant-date fair value of 

have approved the authorization for the grant of 

options granted during the year ended March 31, 

options for the purchase of Toyota’s common stock. 

2011 was ¥724 per share. The fair value of options 

Authorized shares for each year that remain ungranted 

granted is amortized over the option vesting period 

are unavailable for grant in future years. Stock 

in determining net income attributable to Toyota 

options granted in and after August 2006 have 

Motor Corporation in the consolidated statements 

terms of 8 years and an exercise price equal to 

of income. The grant-date fair value of options 

1.025 times the closing price of Toyota’s common 

granted is estimated using the Black-Scholes 

stock on the date of grant. These options generally 

option pricing model with the following weighted-

vest 2 years from the date of grant.

average assumptions:

Dividend rate
Risk-free interest rate
Expected volatility
Expected holding period (years)

2011 
1.5%
0.3%
32%
5.0

Yen

Yen in millions

Options outstanding at March 31, 2010
  Granted
  Exercised
  Canceled
Options outstanding at March 31, 2011
  Granted
  Exercised
  Canceled
Options outstanding at March 31, 2012
  Granted
  Exercised
  Canceled
Options outstanding at March 31, 2013
Options exercisable at March 31, 2011
Options exercisable at March 31, 2012
Options exercisable at March 31, 2013

Number of 
shares
13,716,700
3,435,000
—
(1,364,900)
15,786,800
—
—
(3,256,800)
12,530,000
—
(645,000)
(1,036,000)
10,849,000
9,347,800
9,778,000
10,849,000

Weighted-average 
exercise 
price
¥5,363
3,183
—
4,759
4,941
—
—
5,059
4,910
—
3,328
5,907
¥4,909
¥5,821
¥5,396
¥4,909

Weighted-average 
remaining 
contractual life
 in years
5.23

Aggregate 
intrinsic value
¥     —

5.04

¥   565

4.55

¥1,065

3.56
3.79
4.05
3.56

¥5,921
¥     —
¥     —
¥5,921

  No options were exercised for the years ended 

2012. Cash received from the exercise of stock 

March 31, 2011 and 2012. The total intrinsic value 

options for the year ended March 31, 2013 was 

of options exercised for the year ended March 31, 

¥2,147 million ($23 million).

2013 was ¥364 million ($4 million).

  No cash was received from the exercise of stock 

options for the years ended March 31, 2011 and 

  The following table summarizes information for options outstanding and options exercisable at March 31, 2013:

Outstanding

Exercisable

Exercise price 
range
Number of 
Yen
shares
7,480,000
¥3,183 – 5,000
5,001 – 7,278
3,369,000
3,183 – 7,278 10,849,000

Weighted-average 
exercise price

Yen
¥4,068
6,774
4,909

U.S. dollars 
$43
72
52

Weighted-
average 
remaining life
Years 
4.31
1.89
3.56

Number of 
shares
7,480,000
3,369,000
10,849,000

Weighted-average 
exercise price

Yen 
¥4,068
6,774
4,909

U.S. dollars
$43
72
52

ANNUAL REPORT 2013

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Contents

P a g e  98

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [21 of 44]

Next

Notes to Consolidated Financial Statements

19. Employee beneﬁ t plans

  Pension and severance plans

represent voluntary retirement. Employees receive 

Upon terminations of employment, employees of 

additional beneﬁ ts upon involuntary retirement, 

the parent company and subsidiaries in Japan are 

including retirement at the age limit.

entitled, under the retirement plans of each compa-

  Effective October 1, 2005, the parent company 

ny, to lump-sum indemnities or pension payments, 

partly amended its retirement plan and introduced 

based on current rates of pay and lengths of service 

the quasi cash-balance plan under which beneﬁ ts 

or the number of “points” mainly determined by 

are determined based on the variable-interest cred-

those. Under normal circumstances, the minimum 

iting rate rather than the ﬁ xed-interest crediting rate 

payment prior to retirement age is an amount based 

as was in the pre-amended plan.

on voluntary retirement. Employees receive addi-

  The parent company and most subsidiaries in 

Information regarding Toyota’s deﬁ ned beneﬁ t plans is as follows:

Japanese plans

Change in beneﬁ t obligation:
  Beneﬁ t obligation at beginning of year
  Service cost
Interest cost

  Plan participants’ contributions
  Plan amendments
  Net actuarial loss
  Acquisition and other
  Beneﬁ ts paid

tional beneﬁ ts on involuntary retirement, including 

Japan have contributory funded deﬁ ned beneﬁ t 

  Beneﬁ t obligation at end of year

retirement at the age limit.

pension plans, which are pursuant to the Corporate 

  Effective October 1, 2004, the parent company 

Deﬁ ned Beneﬁ t Pension Plan Law (CDBPPL). The 

amended its retirement plan to introduce a “point” 

contributions to the plans are funded with several 

based retirement beneﬁ t plan. Under the new plan, 

ﬁ nancial institutions in accordance with the applica-

employees are entitled to lump-sum or pension 

ble laws and regulations. These pension plan assets 

payments determined based on accumulated 

consist principally of common stocks, government 

“points” vested in each year of service.

bonds and insurance contracts.

  There are three types of “points” that vest in each 

  Most foreign subsidiaries have pension plans or 

Change in plan assets:
  Fair value of plan assets at beginning of year
  Actual return on plan assets
  Acquisition and other
  Employer contributions
  Plan participants’ contributions
  Beneﬁ ts paid

  Fair value of plan assets at end of year

Funded status

Yen in millions
March 31, 

2012 

2013 

U.S. dollars in millions
March 31,
2013

¥1,362,053
57,241
30,660
834
632
67,098
27,435
(65,566)
1,480,387

885,741
1,493
27,947
50,423
834
(38,893)
927,545
¥   552,842

¥1,480,387
60,261
27,804
918
(3,462)
90,667
(776)
(61,388)
1,594,411

927,545
145,141
(264)
53,906
918
(36,988)
1,090,258
¥   504,153

$15,740
641
296
10
(37)
964
(8)
(653)
16,953

9,862
1,543
(3)
573
10
(393)
11,592
$  5,361

year of service consisting of “service period points” 

severance indemnity plans covering substantially all 

  Amounts recognized in the consolidated balance sheets as of March 31, 2012 and 2013 are comprised of 

which are attributed to the length of service, “job 

of their employees under which the cost of beneﬁ ts 

the following:

title points” which are attributed to the job title of 

are currently invested or accrued. The beneﬁ ts for 

each employee, and “performance points” which 

these plans are based primarily on lengths of ser-

are attributed to the annual performance evaluation 

vice and current rates of pay.

of each employee. Under normal circumstances, 

  Toyota uses a March 31 measurement date for its 

the minimum payment prior to retirement age is an 

beneﬁ t plans.

amount reﬂ ecting an adjustment rate applied to 

Accrued expenses (Accrued pension and severance costs)
Accrued pension and severance costs
Investments and other assets—
  Other (Prepaid pension and severance costs)

  Net amount recognized

Yen in millions
March 31, 

2012 
¥  19,553
553,096

2013 
¥  25,160
582,491

U.S. dollars in millions
March 31,
2013
$   268
6,193

(19,807)
¥552,842

(103,498)
¥504,153

(1,100)
$5,361

 
 
 
 
 
 
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Contents

P a g e  99

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [22 of 44]

Next

Notes to Consolidated Financial Statements

  Amounts recognized in accumulated other comprehensive income (loss) as of March 31, 2012 and 2013 

  Other changes in plan assets and beneﬁ t obligations recognized in other comprehensive income (loss) are 

are comprised of the following:

as follows:

Net actuarial loss
Prior service costs
Net transition obligation

  Net amount recognized

Yen in millions
March 31, 

2012 
¥(381,770)
57,930
—
¥(323,840)

2013 
¥(333,203)
53,360
—
¥(279,843)

U.S. dollars in millions
March 31,
2013
$(3,543)
567
—
$(2,976)

  The accumulated beneﬁ t obligation for all deﬁ ned beneﬁ t pension plans was ¥1,379,373 million and 

¥1,494,011 million ($15,885 million) at March 31, 2012 and 2013, respectively.

  The projected beneﬁ t obligation, accumulated beneﬁ t obligation and fair value of plan assets for which the 

Net actuarial gain (loss)
Recognized net actuarial loss
Prior service costs
Amortization of prior service costs
Amortization of net transition obligation
Other

 Total recognized in other 
  comprehensive income (loss)

Yen in millions

For the years ended March 31,
2012 
¥(87,163)
28,342
(632)
(16,326)
1,626
63

2011 
¥(15,734)
15,029
1,287
(24,421)
1,944
10,529

2013 
¥32,122
16,619
3,462
(8,033)
—
(173)

U.S. dollars in millions
For the year ended 
March 31,
2013
$341
177
37
(86)
—
(2)

¥(11,366)

¥(74,090)

¥43,997

$467

accumulated beneﬁ t obligations exceed plan assets are as follows:

  The other amount includes the impact of transi-

  The estimated prior service costs and net actuarial 

Projected beneﬁ t obligation
Accumulated beneﬁ t obligation
Fair value of plan assets

Yen in millions
March 31, 

2012 
¥728,469
639,196
153,945

2013 
¥749,561
685,763
165,262

U.S. dollars in millions
March 31,
2013
$7,970
7,291
1,757

tion to deﬁ ned contribution pension plans and con-

loss that will be amortized from accumulated other 

solidation and deconsolidation of certain entities 

comprehensive income (loss) into net periodic pen-

due to changes in ownership interest during the 

sion cost during the year ending March 31, 2014 

years ended March 31, 2011, 2012 and 2013.

are ¥(5,000) million ($(53) million) and ¥12,200 mil-

lion ($130 million), respectively.

  Components of the net periodic pension cost are as follows:

Yen in millions

Service cost
Interest cost
Expected return on plan assets
Amortization of prior service costs
Recognized net actuarial loss
Amortization of net transition obligation
  Net periodic pension cost

For the years ended March 31,
2012 
¥57,241
30,660
(21,558)
(16,326)
28,342
1,626
¥79,985

2011 
¥61,134
31,782
(21,200)
(24,421)
15,029
1,944
¥64,268

2013 
¥60,261
27,804
(22,352)
(8,033)
16,619
—
¥74,299

  Weighted-average assumptions used to determine beneﬁ t obligations as of March 31, 2012 and 2013 are 

as follows:

Discount rate
Rate of compensation increase

March 31,

2012 
2.0%
2.3%

2013 
1.7%
2.2%

  As of March 31, 2012 and 2013, the parent com-

use the rates of compensation increase to deter-

pany and certain subsidiaries in Japan employ 

mine beneﬁ t obligations.

“point” based retirement beneﬁ t plans and do not 

U.S. dollars in millions
For the year ended 
March 31,
2013
$641
296
(238)
(86)
177
—
$790

 
 
 
 
 
 
 
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Contents

P a g e  100

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [23 of 44]

Next

Notes to Consolidated Financial Statements

  Weighted-average assumptions used to determine net periodic pension cost for the years ended March 31, 

  The following table summarizes the fair value of classes of plan assets as of March 31, 2012 and 2013. See 

2011, 2012 and 2013 are as follows:

note 26 to the consolidated ﬁ nancial statements for three levels of input which are used to measure fair value.

Discount rate
Expected return on plan assets
Rate of compensation increase

For the years ended March 31,
2012 
2.3%
2.5%
2.3%

2013 
2.0%
2.5%
2.3%

2011 
2.3%
2.3%
2.3%

  During the years ended March 31, 2011, 2012 and 

Excepting equity securities contributed by Toyota, 

2013, the parent company and certain subsidiaries in 

approximately 50% of the plan assets is invested in 

Japan employ “point” based retirement beneﬁ t plans 

equity securities, approximately 30% is invested in 

and do not use the rates of compensation increase 

debt securities, and the rest of them is invested in 

to determine net periodic pension cost.

insurance contracts and other products. When 

  The expected rate of return on plan assets is 

actual allocations are not in line with target alloca-

determined after considering several applicable fac-

tions, Toyota rebalances its investments in accor-

tors including, the composition of plan assets held, 

dance with the policies. Prior to making individual 

assumed risks of asset management, historical 

investments, Toyota performs in-depth assessments 

results of the returns on plan assets, Toyota’s princi-

of corresponding factors including category of prod-

pal policy for plan asset management, and forecast-

ucts, industry type, currencies and liquidity of each 

ed market conditions.

potential investment under consideration to mitigate 

  Toyota’s policy and objective for plan asset man-

concentrations of risks such as market risk and for-

agement is to maximize returns on plan assets to 

eign currency exchange rate risk. To assess perfor-

meet future beneﬁ t payment requirements under 

mance of the investments, Toyota establishes 

risks which Toyota considers permissible. Asset 

bench mark return rates for each individual invest-

allocations under the plan asset management are 

ment, combines these individual bench mark rates 

determined based on plan asset management poli-

based on the asset composition ratios within each 

cies of each plan which are established to achieve 

asset category, and compares the combined rates 

the optimized asset compositions in terms of the 

with the corresponding actual return rates on each 

long-term overall plan asset management. 

asset category.

Equity securities:
  Common stocks
  Commingled funds

Debt securities:
  Government bonds
  Commingled funds
  Other

Insurance contracts
Other

  Total

Equity securities:
  Common stocks
  Commingled funds

Debt securities:
  Government bonds
  Commingled funds
  Other

Insurance contracts
Other

  Total

Yen in millions
March 31, 2012

Level 1

 Level 2 

Level 3 

Total

¥353,282
—
353,282

63,327
—
—
63,327
—
27,006
¥443,615

¥         —
158,027
158,027

—
176,596
20,155
196,751
83,993
4,503
¥443,274

¥       —
—
—

—
—
591
591
—
40,065
¥40,656

¥353,282
158,027
511,309

63,327
176,596
20,746
260,669
83,993
71,574
¥927,545

Yen in millions
March 31, 2013

Level 1

 Level 2 

Level 3 

Total

¥440,971
—
440,971

81,867
—
—
81,867
—
17,789
¥540,627

¥         —
184,879
184,879

—
203,933
23,594
227,527
91,326
3,923
¥507,655

¥       —
—
—

—
—
441
441
—
41,535
¥41,976

¥   440,971
184,879
625,850

81,867
203,933
24,035
309,835
91,326
63,247
¥1,090,258

 
 
 
 
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Contents

P a g e  101

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [24 of 44]

Next

Notes to Consolidated Financial Statements

Equity securities:
  Common stocks
  Commingled funds

Debt securities:
  Government bonds
  Commingled funds
  Other

Insurance contracts
Other

  Total

U.S. dollars in millions
March 31, 2013

Level 1

 Level 2 

Level 3 

Total

$4,689
—
4,689

870
—
—
870
—
189
$5,748

$     —
1,966
1,966

—
2,168
251
2,419
971
42
$5,398

$  —
—
—

—
—
5
5
—
441
$446

$  4,689
1,966
6,655

870
2,168
256
3,294
971
672
$11,592

  The following is description of the assets, infor-

  Commingled funds are beneﬁ cial interests of col-

mation about the valuation techniques used to mea-

lective trust. The fair values of commingled funds 

sure fair value, key inputs and signiﬁ cant 

are measured using the net asset value (“NAV”) pro-

assumptions:

vided by the administrator of the fund, and are cate-

  Quoted market prices for identical securities are 

gorized by the ability to redeem investments at the 

used to measure fair value of common stocks. 

measurement day.

Common stocks include 69% of Japanese stocks 

  The fair values of insurance contracts are measured 

and 31% of foreign stocks as of March 31, 2012, 

using contracted amount with accrued interest.

and 71% of Japanese stocks and 29% of foreign 

  Other consists of cash equivalents, other private 

stocks as of March 31, 2013.

placement investment funds and other assets. The 

  Quoted market prices for identical securities are 

fair values of other private placement investment 

used to measure fair value of government bonds. 

funds are measured using the NAV provided by the 

Government bonds include 35% of Japanese gov-

administrator of the fund, and are categorized by 

ernment bonds and 65% of foreign government 

the ability to redeem investments at the measure-

bonds as of March 31, 2012, and 44% of Japanese 

ment day.

government bonds and 56% of foreign government 

bonds as of March 31, 2013.

  The following tables summarize the changes in Level 3 plan assets measured at fair value for the years 

ended March 31, 2011, 2012 and 2013:

Balance at beginning of year
  Actual return on plan assets
  Purchases, sales and settlements
  Other
Balance at end of year

Balance at beginning of year
  Actual return on plan assets
  Purchases, sales and settlements
  Other
Balance at end of year

Balance at beginning of year
  Actual return on plan assets
  Purchases, sales and settlements
  Other
Balance at end of year

Balance at beginning of year
  Actual return on plan assets
  Purchases, sales and settlements
  Other
Balance at end of year

Yen in millions
For the year ended March 31, 2011
Other
¥37,421
934
19
—
¥38,374

Debt securities
¥928
7
(189)
—
¥746

Total
¥38,349
941
(170)
—
¥39,120

Yen in millions
For the year ended March 31, 2012
Other
¥38,374
(1,762)
3,453
—
¥40,065

Debt securities
¥746
5
(160)
—
¥591

Total
¥39,120
(1,757)
3,293
—
¥40,656

Yen in millions
For the year ended March 31, 2013
Other
¥40,065
438
1,032
—
¥41,535

Debt securities
¥591
3
(153)
—
¥441

Total
¥40,656
441
879
—
¥41,976

U.S. dollars in millions
For the year ended March 31, 2013
Other
$426
4
11
—
$441

Debt securities
$  6
0
(1)
—
$  5

Total
$432
4
10
—
$446

  Toyota expects to contribute ¥54,094 million ($575 million) to its pension plans in the year ending March 31, 2014.

 
 
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P a g e  102

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [25 of 44]

Next

Notes to Consolidated Financial Statements

  The following pension beneﬁ t payments, which reﬂ ect expected future service, as appropriate, are expected 

  Amounts recognized in the consolidated balance sheets as of March 31, 2012 and 2013 are comprised of 

to be paid:

Years ending March 31,
2014
2015
2016
2017
2018
from 2019 to 2023
  Total 

Foreign plans

the following:

 Yen in millions
¥  62,508
64,803
66,445
66,497
67,780
379,369
¥707,402

U.S. dollars in millions
$   665
689
706
707
721
4,034
$7,522

Accrued expenses (Accrued pension and severance costs)
Accrued pension and severance costs
Investments and other assets—
  Other (Prepaid pension and severance costs)

  Net amount recognized

Yen in millions
March 31, 

2012 
¥    1,523
155,306

2013 
¥    1,762
183,621

U.S. dollars in millions
March 31,
2013
$     18
1,953

(33,055)
¥123,774

(31,462)
¥153,921

(335)
$1,636

  Amounts recognized in accumulated other comprehensive income (loss) as of March 31, 2012 and 2013 

Yen in millions
March 31, 

2012 

2013 

U.S. dollars in millions
March 31,
2013

are comprised of the following:

Change in beneﬁ t obligation:
  Beneﬁ t obligation at beginning of year
  Service cost
Interest cost

  Plan participants’ contributions
  Plan amendments
  Net actuarial loss
  Acquisition and other
  Beneﬁ ts paid

  Beneﬁ t obligation at end of year

Change in plan assets:
  Fair value of plan assets at beginning of year
  Actual return on plan assets
  Acquisition and other
  Employer contributions
  Plan participants’ contributions
  Beneﬁ ts paid

  Fair value of plan assets at end of year

Funded status

¥367,125
21,298
21,739
221
108
50,222
13,061
(6,774)
467,000

297,644
14,816
19,600
16,125
221
(5,180)
343,226
¥123,774

¥467,000
27,943
24,300
246
(43)
38,986
82,907
(8,179)
633,160

343,226
46,359
60,138
35,354
246
(6,084)
479,239
¥153,921

$4,965
297
258
3
(0)
415
881
(87)
6,732

3,649
493
640
376
3
(65)
5,096
$1,636

Net actuarial loss
Prior service costs
Net transition obligation

  Net amount recognized

Yen in millions
March 31, 

2012 
¥(75,069)
(2,333)
—
¥(77,402)

2013 
¥(96,151)
(1,921)
—
¥(98,072)

U.S. dollars in millions
March 31,
2013
$(1,022)
(20)
—
$(1,042)

  The accumulated beneﬁ t obligation for all deﬁ ned 

¥533,551 million ($5,673 million) at March 31, 2012 

beneﬁ t pension plans was ¥385,348 million and 

and 2013, respectively.

  The projected beneﬁ t obligation, accumulated beneﬁ t obligation and fair value of plan assets for which the 

accumulated beneﬁ t obligations exceed plan assets are as follows:

Projected beneﬁ t obligation
Accumulated beneﬁ t obligation
Fair value of plan assets

Yen in millions
March 31, 

2012 
¥229,015
190,422
52,123

2013 
¥251,596
213,934
43,277

U.S. dollars in millions
March 31,
2013
$2,675
2,275
460

 
 
 
 
 
 
 
 
 
 
 
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Contents

P a g e  103

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [26 of 44]

Next

Notes to Consolidated Financial Statements

  Components of the net periodic pension cost are as follows:

  Weighted-average assumptions used to determine beneﬁ t obligations as of March 31, 2012 and 2013 are 

Service cost
Interest cost
Expected return on plan assets
Amortization of prior service costs
Recognized net actuarial loss
Amortization of net transition obligation
  Net periodic pension cost

Yen in millions

For the years ended March 31,
2012 
¥21,298
21,739
(22,864)
351
1,783
—
¥22,307

2011 
¥21,288
20,720
(21,164)
389
1,066
—
¥22,299

2013 
¥27,943
24,300
(23,177)
369
2,884
—
¥32,319

U.S. dollars in millions
For the year ended 
March 31,
2013
$297
258
(246)
4
31
—
$344

as follows:

Discount rate
Rate of compensation increase

March 31,

2012 
5.0%
4.5%

2013 
4.5%
4.6%

  Weighted-average assumptions used to determine net periodic pension cost for the years ended March 31, 

2011, 2012 and 2013 are as follows:

  Other changes in plan assets and beneﬁ t obligations recognized in other comprehensive income (loss) are 

as follows:

Discount rate
Expected return on plan assets
Rate of compensation increase

For the years ended March 31,
2012 
5.7%
7.3%
4.4%

2013 
5.0%
7.0%
4.5%

2011 
6.2%
7.4%
4.5%

Net actuarial loss
Recognized net actuarial loss
Prior service costs
Amortization of prior service costs
Amortization of net transition obligation
Other

 Total recognized in other 
  comprehensive income (loss)

Yen in millions

For the years ended March 31,
2012 
¥(58,270)
1,783
(108)
351
—
5,888

2013 
¥(15,804)
2,884
43
369
—
(8,162)

2011 
¥ (6,244)
1,066
142
389
—
30,466

U.S. dollars in millions
For the year ended 
March 31,
2013
$(168)
31
0
4
—
(87)

¥25,819

¥(50,356)

¥(20,670)

$(220)

  The expected rate of return on plan assets is 

equity securities, approximately 30% is invested in 

determined after considering several applicable 

debt securities, and the rest of them is invested in 

 factors including, the composition of plan assets 

other products. When actual allocations are not in 

held, assumed risks of asset management, histori-

line with target allocations, Toyota rebalances its 

cal results of the returns on plan assets, Toyota’s 

investments in accordance with the policies. Prior to 

principal policy for plan asset management, and 

making individual investments, Toyota performs in-

forecasted market conditions.

depth assessments of corresponding factors includ-

  Toyota’s policy and objective for plan asset man-

ing category of products, industry type, currencies 

agement is to maximize returns on plan assets to 

and liquidity of each potential investment under 

meet future beneﬁ t payment requirements under 

consideration to mitigate concentrations of risks 

  The other amount includes the impact of consoli-

  The estimated prior service costs and net actuari-

risks which Toyota considers permissible. Asset 

such as market risk and foreign currency exchange 

dation and deconsolidation of certain entities due to 

al loss that will be amortized from accumulated 

allocations under the plan asset management are 

rate risk. To assess performance of the investments, 

changes in ownership interest and currency transla-

other comprehensive income (loss) into net periodic 

determined based on plan asset management poli-

Toyota establishes bench mark return rates for each 

tion adjustments during the years ended March 31, 

pension cost during the year ending March 31, 

cies of each plan which are established to achieve 

individual investment, combines these individual 

2011, 2012 and 2013.

2014 are ¥300 million ($3 million) and ¥4,400 million 

the optimized asset compositions in terms of the 

bench mark rates based on the asset composition 

($47 million), respectively.

long-term overall plan asset management. 

ratios within each asset category, and compares the 

Excepting equity securities contributed by Toyota, 

combined rates with the corresponding actual 

approximately 60% of the plan assets is invested in 

return rates on each asset category.

 
 
 
 
 
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P a g e  104

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [27 of 44]

Next

Notes to Consolidated Financial Statements

  The following table summarizes the fair value of classes of plan assets as of March 31, 2012 and 2013. See 

note 26 to the consolidated ﬁ nancial statements for three levels of input which are used to measure fair value.

Yen in millions
March 31, 2012

Level 1

 Level 2 

Level 3 

Total

¥114,955
—
114,955

25,084
—
—
25,084
—
21,184
¥161,223

¥         —
74,815
74,815

—
43,062
29,278
72,340
—
3,471
¥150,626

¥        —
—
—

—
—
—
—
—
31,377
¥31,377

¥114,955
74,815
189,770

25,084
43,062
29,278
97,424
—
56,032
¥343,226

Yen in millions
March 31, 2013

Equity securities
  Common stocks
  Commingled funds

Debt securities
  Government bonds
  Commingled funds
  Other

Insurance contracts
Other

  Total

U.S. dollars in millions
March 31, 2013

Level 1

 Level 2 

Level 3 

Total

$1,952
—
1,952

501
—
—
501
—
327
$2,780

$     —
920
920

—
455
430
885
13
66
$1,884

$  —
—
—

—
—
—
—
—
432
$432

$1,952
920
2,872

501
455
430
1,386
13
825
$5,096

  The following is description of the assets, informa-

  Commingled funds are beneﬁ cial interests of col-

tion about the valuation techniques used to measure 

lective trust. The fair values of commingled funds are 

fair value, key inputs and signiﬁ cant assumptions:

measured using the NAV provided by the adminis-

Level 1

 Level 2 

Level 3 

Total

  Quoted market prices for identical securities are 

trator of the fund, and are categorized by the ability 

¥183,611
—
183,611

47,083
—
—
47,083
—
30,739
¥261,433

¥          —
86,539
86,539

—
42,754
40,486
83,240
1,202
6,218
¥177,199

¥       —
—
—

—
—
—
—
—
40,607
¥40,607

¥183,611
86,539
270,150

47,083
42,754
40,486
130,323
1,202
77,564
¥479,239

used to measure fair value of common stocks. 

to redeem investments at the measurement day.

Common stocks include mainly foreign stocks as of 

  Other consists of cash equivalents, other private 

March 31, 2012 and 2013.

placement investment funds and other assets. 

  Quoted market prices for identical securities are 

The fair values of other private placement invest-

used to measure fair value of government bonds. 

ment funds are measured using the NAV provided 

Government bonds include mainly foreign govern-

by the administrator of the fund, and are catego-

ment bonds as of March 31, 2012 and 2013.

rized by the ability to redeem investments at the 

measurement day.

Equity securities
  Common stocks
  Commingled funds

Debt securities
  Government bonds
  Commingled funds
  Other

Insurance contracts
Other

  Total

Equity securities
  Common stocks
  Commingled funds

Debt securities
  Government bonds
  Commingled funds
  Other

Insurance contracts
Other

  Total

 
 
 
 
 
 
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P a g e  105

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [28 of 44]

Next

Notes to Consolidated Financial Statements

  The following tables summarize the changes in Level 3 plan assets measured at fair value for the years 

  The following pension beneﬁ t payments, which reﬂ ect expected future service, as appropriate, are expected 

ended March 31, 2011, 2012 and 2013:

Balance at beginning of year
  Actual return on plan assets
  Purchases, sales and settlements
  Other
Balance at end of year

Balance at beginning of year
  Actual return on plan assets
  Purchases, sales and settlements
  Other
Balance at end of year

Balance at beginning of year
  Actual return on plan assets
  Purchases, sales and settlements
  Other
Balance at end of year

Balance at beginning of year
  Actual return on plan assets
  Purchases, sales and settlements
  Other
Balance at end of year

Yen in millions
For the year ended March 31, 2011
Other
¥  9,097
974
11,471
(1,065)
¥20,477

Debt securities
¥2,663
305
(2,759)
(209)
¥      —

Total
¥11,760
1,279
8,712
(1,274)
¥20,477

Yen in millions
For the year ended March 31, 2012
Other
¥20,477
1,243
9,514
143
¥31,377

Debt securities
¥—
—
—
—
¥—

Total
¥20,477
1,243
9,514
143
¥31,377

Yen in millions
For the year ended March 31, 2013
Other
¥31,377
2,472
2,599
4,159
¥40,607

Debt securities
¥—
—
—
—
¥—

Total
¥31,377
2,472
2,599
4,159
¥40,607

U.S. dollars in millions
For the year ended March 31, 2013
Other
$334
26
28
44
$432

Debt securities
$—
—
—
—
$—

Total
$334
26
28
44
$432

to be paid:

Years ending March 31,
2014
2015
2016
2017
2018
from 2019 to 2023
  Total 

 Yen in millions
¥    8,535
9,264
9,955
10,660
11,491
73,651
¥123,556

U.S. dollars in millions
$     91
99
106
113
122
783
$1,314

  Postretirement beneﬁ ts other than pensions and postemployment beneﬁ ts

Toyota’s U.S. subsidiaries provide certain health 

provided through various insurance companies, 

care and life insurance beneﬁ ts to eligible retired 

health care providers and others. The costs of these 

employees. In addition, Toyota provides beneﬁ ts to 

beneﬁ ts are recognized over the period the employ-

certain former or inactive employees after employ-

ee provides credited service to Toyota. Toyota’s obli-

ment, but before retirement. These beneﬁ ts are 

gations under these arrangements are not material.

20. Derivative ﬁ nancial instruments

Toyota employs derivative ﬁ nancial instruments, 

uses interest rate currency swap agreements to 

including foreign exchange forward contracts, foreign 

hedge exposure to currency exchange rate ﬂ uctua-

currency options, interest rate swaps, interest rate 

tions on principal and interest payments for borrow-

currency swap agreements and interest rate options 

ings denominated in foreign currencies. Notes and 

to manage its exposure to ﬂ uctuations in interest 

loans payable issued in foreign currencies are 

rates and foreign currency exchange rates. Toyota 

hedged by concurrently executing interest rate cur-

does not use derivatives for speculation or trading.

rency swap agreements, which involve the exchange 

of foreign currency principal and interest obligations 

  Fair value hedges

for each functional currency obligations at agreed-

Toyota enters into interest rate swaps and interest 

upon currency exchange and interest rates.

rate currency swap agreements mainly to convert 

  For the years ended March 31, 2011, 2012 and 

  Toyota expects to contribute ¥8,688 million ($92 million) to its pension plans in the year ending March 31, 2014.

its ﬁ xed-rate debt to variable-rate debt. Toyota uses 

2013, the ineffective portion of Toyota’s fair value 

interest rate swap agreements in managing interest 

hedge relationships was not material. For fair value 

rate risk exposure. Interest rate swap agreements 

hedging relationships, the components of each 

are executed as either an integral part of speciﬁ c 

derivative’s gain or loss are included in the assess-

debt transactions or on a portfolio basis. Toyota 

ment of hedge effectiveness.

 
 
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P a g e  106

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [29 of 44]

Next

Notes to Consolidated Financial Statements

  Undesignated derivative ﬁ nancial instruments

  As of March 31, 2012 and 2013, the amounts of 

and cash collateral pledged that partially offset 

Toyota uses foreign exchange forward contracts, 

currency exchange rate ﬂ uctuations and interest 

counterparty netting and cash collateral received 

derivative liabilities were ¥(90,963) million and 

foreign currency options, interest rate swaps, inter-

rate ﬂ uctuations from an economic perspective, and 

that partially offset derivative assets were ¥218,509 

¥(86,477) million ($(919) million), respectively. These 

est rate currency swap agreements, and interest 

for which Toyota is unable or has elected not to 

million and ¥158,807 million ($1,689 million), 

amounts included in the above table were offset in 

rate options, to manage its exposure to foreign 

apply hedge accounting.

respectively. The amounts of counterparty netting 

the consolidated balance sheets.

  Fair value and gains or losses on derivative ﬁ nancial instruments

  The following table summarizes the notional amounts of derivative ﬁ nancial instruments as of March 31, 

The following table summarizes the fair values of derivative ﬁ nancial instruments as of March 31, 2012 and 2013:

2012 and 2013:

Yen in millions 
March 31, 

2012

2013

U.S. dollars in millions
March 31,
2013

Designated 
derivative 
ﬁ nancial
 instruments

Undesignated 
derivative 
ﬁ nancial 
instruments

Designated 
derivative 
ﬁ nancial 
instruments

Undesignated 
derivative 
ﬁ nancial 
instruments

Designated 
derivative 
ﬁ nancial 
instruments

Undesignated 
derivative 
ﬁ nancial 
instruments

¥344,623 ¥10,607,666 ¥235,219 ¥12,689,774

$2,501

$134,926

—

2,104,048
¥344,623 ¥12,807,293 ¥235,219 ¥14,793,822

2,199,627

—

—
$2,501

22,371
$157,297

Derivative ﬁ nancial instruments designated as 
  hedging instruments:

Interest rate and currency swap agreements
  Prepaid expenses and other current assets

Investments and other assets—Other
  Total

  Other current liabilities
  Other long-term liabilities

  Total

Undesignated derivative ﬁ nancial instruments:

Interest rate and currency swap agreements
  Prepaid expenses and other current assets

Investments and other assets—Other
  Total

  Other current liabilities
  Other long-term liabilities

  Total

  Foreign exchange forward and option contracts
  Prepaid expenses and other current assets

Investments and other assets—Other
  Total

  Other current liabilities
  Other long-term liabilities

  Total

Yen in millions
March 31, 

2012 

2013 

U.S. dollars in millions
March 31,
2013

¥     7,166
61,174
¥   68,340
¥    (2,060)
(303)
¥    (2,363)

¥   61,983
157,642
¥ 219,625
¥  (38,338)
(120,666)
¥(159,004)

¥     9,531
—
¥     9,531
¥  (21,736)
(70)
¥  (21,806)

¥   10,769
39,569
¥   50,338
¥    (2,554)
(143)
¥    (2,697)

¥   27,731
139,419
¥ 167,150
¥  (37,133)
(122,420)
¥(159,553)

¥     7,340
—
¥     7,340
¥  (36,087)
(5)
¥  (36,092)

$    114
421
$    535
$     (27)
(2)
$     (29)

$    295
1,482
$ 1,777
$   (395)
(1,301)
$(1,696)

$      78
—
$      78
$   (384)
(0)
$   (384)

Interest rate and currency
   swap agreements
Foreign exchange forward
   and option contracts

  Total

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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P a g e  107

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [30 of 44]

Next

Notes to Consolidated Financial Statements

  The following table summarizes the gains and losses on derivative ﬁ nancial instruments and hedged items 

  Undesignated derivative ﬁ nancial instruments are 

  Credit risk related contingent features

reported in the consolidated statements of income for the years ended March 31, 2011, 2012 and 2013:

used to manage risks of ﬂ uctuations in interest rates 

Toyota enters into International Swaps and 

Yen in millions 
For the years ended March 31,

2011

2012

Gains or 
(losses) on 
derivative 
ﬁ nancial 
instruments

Gains or 
(losses) on 
hedged 
items

Gains or 
(losses) on 
derivative 
ﬁ nancial 
instruments

Gains or 
(losses) on 
hedged 
items

to certain borrowing transactions and in foreign cur-

Derivatives Association Master Agreements with 

rency exchange rates of certain currency receiv-

counterparties. These Master Agreements contain a 

ables and payables. Toyota accounts for these 

provision requiring either Toyota or the counterparty 

derivative ﬁ nancial instruments as economic hedges 

to settle the contract or to post assets to the other 

with changes in the fair value recorded directly into 

party in the event of a ratings downgrade below a 

current period earnings.

speciﬁ ed threshold.

  Unrealized gains or (losses) on undesignated 

  The aggregate fair value amount of derivative 

derivative ﬁ nancial instruments reported in the cost 

ﬁ nancial instruments that contain credit risk related 

¥  71,491
(166)

¥(68,741)
166

¥ (1,354)
—

¥2,999
—

of ﬁ nancing operations for the years ended March 

contingent features that are in a net liability position 

31, 2011, 2012 and 2013 were ¥93,370 million, 

after being offset by cash collateral as of March 31, 

Derivative ﬁ nancial instruments designated as 
  hedging instruments—Fair value hedge:
Interest rate and currency swap agreements
  Cost of ﬁ nancing operations

Interest expense

Undesignated derivative ﬁ nancial instruments:

Interest rate and currency swap agreements
  Cost of ﬁ nancing operations
  Foreign exchange gain (loss), net

  Foreign exchange forward and option contracts

¥  72,082
(1,393)

¥        —
—

¥35,834
(28)

¥     —
—

  Cost of ﬁ nancing operations
  Foreign exchange gain (loss), net

(2,693)
110,211

—
—

(3,815)
53,272

—
—

Yen in millions 
For the year ended March 31,
2013

U.S. dollars in millions
For the year ended March 31,
2013

Gains or 
(losses) on 
derivative 
ﬁ nancial 
instruments

Gains or 
(losses) on 
hedged 
items

Gains or 
(losses) on 
derivative 
ﬁ nancial 
instruments

Gains or 
(losses) on 
hedged 
items

Derivative ﬁ nancial instruments designated as 
  hedging instruments—Fair value hedge:
Interest rate and currency swap agreements
  Cost of ﬁ nancing operations

Interest expense

Undesignated derivative ﬁ nancial instruments:

Interest rate and currency swap agreements
  Cost of ﬁ nancing operations
  Foreign exchange gain (loss), net

  Foreign exchange forward and option contracts

  Cost of ﬁ nancing operations
  Foreign exchange gain (loss), net

¥(23,965)
—

¥24,738
—

$(255)
—

¥(24,204)
1,617

¥       —
—

(4,572)
(49,239)

—
—

$(257)
17

(49)
(524)

$263
—

$   —
—

—
—

¥(14,934) million and ¥(60,727) million ($(646) mil-

2013 is ¥3,289 million ($35 million). The aggregate 

lion) those reported in foreign exchange gain (loss), 

fair value amount of assets that are already posted 

net were ¥(240) million, ¥(5,543) million and ¥(7,447) 

as cash collateral as of March 31, 2013 is ¥17,305 

million ($(79) million), respectively.

million ($184 million). If the ratings of Toyota decline 

  Cash ﬂ ows from transactions of derivative ﬁ nan-

below speciﬁ ed thresholds, the maximum amount 

cial instruments are included in cash ﬂ ows from 

of assets to be posted or for which Toyota could be 

operating activities in the consolidated statements 

required to settle the contracts is ¥3,289 million 

of cash ﬂ ows.

($35 million) as of March 31, 2013.

21. Other ﬁ nancial instruments

Toyota has certain ﬁ nancial instruments, including 

currency or an interest rate instrument, Toyota’s 

ﬁ nancial assets and liabilities which arose in the nor-

risk is limited to the fair value of the instrument. 

mal course of business. These ﬁ nancial instruments 

Although Toyota may be exposed to losses in the 

are executed with creditworthy ﬁ nancial institutions, 

event of nonperformance by counterparties on 

and virtually all foreign currency contracts are 

ﬁ nancial instruments, it does not anticipate signiﬁ -

denominated in U.S. dollars, euros and other cur-

cant losses due to the nature of its counterparties. 

rencies of major developed countries. Financial 

Counterparties to Toyota’s ﬁ nancial instruments rep-

instruments involve, to varying degrees, market risk 

resent, in general, international ﬁ nancial institutions. 

as instruments are subject to price ﬂ uctuations, and 

Additionally, Toyota does not have a signiﬁ cant 

elements of credit risk in the event a counterparty 

exposure to any individual counterparty. Toyota 

should default. In the unlikely event the counterpar-

believes that the overall credit risk related to its 

ties fail to meet the contractual terms of a foreign 

ﬁ nancial instruments is not signiﬁ cant.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [31 of 44]

Next

Notes to Consolidated Financial Statements

  The following table summarizes the estimated fair values of Toyota’s ﬁ nancial instruments, excluding market-

  Cash and cash equivalents and 

  Other receivables

able securities and other securities investments, afﬁ liated companies and derivative ﬁ nancial instruments. See 

time deposits

Other receivables are short-term receivables. These 

note 26 to the consolidated ﬁ nancial statements for three levels of input which are used to measure fair value.

In the normal course of business, substantially all 

receivables are carried at amounts which approxi-

Yen in millions
March 31, 2012

Estimated fair value

Level 1 

Level 2 

Level 3 

Total

¥   234,924
80,301

¥1,444,276
—
—
— 9,137,936
—
408,547
—
—
(194,571)
— (3,256,078)

¥             — ¥ 1,679,200
80,301
9,137,936
408,547
(3,450,649)

Carrying 
amount 

¥1,679,200
80,301
8,879,731
408,547
(3,450,649)

cash and cash equivalents and time deposits are 

mate fair value, and the difference between the car-

highly liquid and are carried at amounts which 

rying amount and the fair value is not material. 

approximate fair value due to its short duration. 

These receivables are classiﬁ ed in Level 3.

Cash equivalents and time deposits include nego-

tiable certiﬁ cate of deposit measured at fair value on 

  Short-term borrowings and long-term debt

a recurring basis. Where money market funds pro-

The fair values of short-term borrowings and long-

duce a daily net asset value in an active market, this 

term debt including the current portion, except for 

value is used to determine the fair value of the fund 

secured loans provided by securitization transac-

investment, and the investment is classiﬁ ed in Level 

tions using special-purpose entities, are estimated 

(8,533,549)

— (7,835,970)

(847,223)

(8,683,193)

1. All other types of cash and cash equivalents and 

based on the discounted amounts of future cash 

Yen in millions
March 31, 2013

Estimated fair value

Level 1 

Level 2 

Level 3 

Total

Carrying 
amount 

¥   375,941 ¥               — ¥  1,718,297
¥   1,718,297 ¥1,342,356
106,700
—
—
— 11,434,936 11,434,936
—
—
432,693
—
— (4,089,528)
— (4,089,528)

106,700
11,144,427
432,693
(4,089,528)

106,700

432,693

time deposits are classiﬁ ed in Level 2.

ﬂ ows using Toyota’s current borrowing rates for sim-

ilar liabilities. As these inputs are observable, these 

  Finance receivables, net

debts are classiﬁ ed in Level 2.

The fair values of ﬁ nance receivables are estimated 

  The fair values of the secured loans provided by 

by discounting expected cash ﬂ ows to present 

securitization transactions are estimated based on 

value using internal assumptions, including prepay-

current market rates and credit spreads for debt 

ment speeds, expected credit losses and collateral 

with similar maturities. Internal assumptions includ-

value. Certain impaired ﬁ nance receivables are mea-

ing prepayment speeds and expected credit losses 

sured at fair value on a nonrecurring basis based on 

are used to estimate the timing of cash ﬂ ows to be 

(10,020,853)

— (9,244,942)

(979,196) (10,224,138)

collateral values.

paid on the underlying securitized assets. As these 

U.S. dollars in millions
March 31, 2013

Estimated fair value

Level 1 

Level 2 

Level 3 

Total

$14,273
—
—
—
—

$  3,997
1,135
—
—
(43,482)

$         —
—
121,584
4,601
—

$  18,270
1,135
121,584
4,601
(43,482)

Carrying 
amount 

$  18,270
1,135
118,495
4,601
(43,482)

(106,548)

—

(98,298)

(10,412)

(108,710)

  As unobservable inputs are utilized, ﬁ nance 

valuations utilize unobservable inputs, the secured 

receivables are classiﬁ ed in Level 3.

loans are classiﬁ ed in Level 3. See note 12 to the 

consolidated ﬁ nancial statements for information 

regarding the secured loans.

Assets (Liabilities):
  Cash and cash equivalents
  Time deposits
  Total ﬁ nance receivables, net
  Other receivables
  Short-term borrowings

 Long-term debt including 
  the current portion

Assets (Liabilities):
  Cash and cash equivalents
  Time deposits
  Total ﬁ nance receivables, net
  Other receivables
  Short-term borrowings

 Long-term debt including 
  the current portion

Assets (Liabilities):
  Cash and cash equivalents
  Time deposits
  Total ﬁ nance receivables, net
  Other receivables
  Short-term borrowings

 Long-term debt including 
  the current portion

 
 
 
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P a g e  109

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [32 of 44]

Next

Notes to Consolidated Financial Statements

22. Lease commitments

Toyota leases certain assets under capital lease and operating lease arrangements.

  An analysis of leased assets under capital leases is as follows:

Class of property:
  Building 
  Machinery and equipment
  Less—Accumulated depreciation

Yen in millions
March 31, 

2012 

2013 

U.S. dollars in millions
March 31,
2013

¥12,230
 31,698
 (20,284)
¥23,644

 ¥13,999
 32,252
 (23,843)
 ¥22,408

 $149
 343
 (254)
 $238

  The minimum rental payments required under operating leases relating primarily to land, buildings and 

equipment having initial or remaining non-cancelable lease terms in excess of one year at March 31, 2013 are 

as follows:

Years ending March 31,
2014
2015
2016
2017
2018
Thereafter

  Total minimum future rentals

 Yen in millions
¥11,299
9,398
7,988
6,347
5,354
21,491
 ¥61,877

U.S. dollars in millions
 $120
 100
 85
 67
 57
 229
 $658

  Amortization expenses under capital leases for the years ended March 31, 2011, 2012 and 2013 were 

¥5,966 million, ¥5,572 million and ¥5,265 million ($56 million), respectively.

  Future minimum lease payments under capital leases together with the present value of the net minimum 

23. Other commitments and contingencies, concentrations and factors that may affect future operations

lease payments as of March 31, 2013 are as follows:

Years ending March 31,
2014
2015
2016
2017
2018
Thereafter

  Total minimum lease payments

Less—Amount representing interest

  Present value of net minimum lease payments

Less—Current obligations

  Long-term capital lease obligations

 Yen in millions
¥  4,993
3,542
2,790
2,409
2,049
12,926
 28,709
 (7,310)
 21,399
 (4,096)
 ¥17,303

U.S. dollars in millions
 $  53
 38
 30
 25
 22
 137
 305
 (77)
 228
 (44)
 $184

  Commitments

¥6,590 million ($70 million) have been provided as 

Commitments outstanding as of March 31, 2013 for 

of March 31, 2013. Under these guarantee con-

the purchase of property, plant and equipment and 

tracts, Toyota is entitled to recover any amount paid 

other assets totaled ¥203,901 million ($2,168 million).

by Toyota from the customers whose original obli-

  Guarantees

Toyota enters into contracts with Toyota dealers to 

  Legal Proceedings

guarantee customers’ payments of their installment 

Product Recalls

gations Toyota has guaranteed.

payables that arise from installment contracts 

From time-to-time, Toyota issues vehicle recalls and 

between customers and Toyota dealers, as and 

takes other safety measures including safety cam-

when requested by Toyota dealers. Guarantee peri-

paigns relating to its vehicles. In November 2009, 

ods are set to match maturity of installment pay-

Toyota announced a safety campaign in North 

  Rental expenses under operating leases for the years ended March 31, 2011, 2012 and 2013 were ¥89,029 

ments, and as of March 31, 2013, range from 1 

America for certain models of Toyota and Lexus 

million, ¥91,052 million and ¥90,081 million ($958 million), respectively.

month to 35 years; however, they are generally 

vehicles related to ﬂ oor mat entrapment of accelera-

shorter than the useful lives of products sold. Toyota 

tor pedals, and later expanded it to include addi-

is required to execute its guarantee primarily when 

tional models. In January 2010, Toyota announced 

customers are unable to make required payments.

a recall in North America for certain models of 

  The maximum potential amount of future pay-

Toyota vehicles related to sticking and slow-to-

ments as of March 31, 2013 is ¥1,849,493 million 

return accelerator pedals. Also in January 2010, 

($19,665 million). Liabilities for guarantees totaling 

Toyota recalled in Europe, China and other regions 

 
 
 
 
 
 
 
 
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President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [33 of 44]

Next

Notes to Consolidated Financial Statements

certain models of Toyota vehicles related to sticking 

submission and scheduled a hearing in July 2013 

hybrid vehicles that cause the vehicles to fail to stop 

  While Toyota has resolved or is attempting to 

accelerator pedals. In February 2010, Toyota 

for the presentation of additional information. In 

in a timely manner when driving in certain road con-

resolve many of these matters, Toyota believes that 

announced a worldwide recall related to the soft-

 ﬁ scal 2013, Toyota recorded a $1.1 billion pre-tax 

ditions. The plaintiffs seek an order requiring Toyota 

it has meritorious defenses to all of them and will 

ware program that controls the antilock braking 

charge against earnings to cover the estimated 

to repair the vehicles and claim that all owners and 

vigorously defend those matters not resolved.

 system in certain vehicle models including the Prius. 

costs of this resolution and other potential recall- 

lessees of vehicles, including those for which recalls 

Set forth below is a description of various claims, 

related resolutions, including the resolution of the civil 

have been implemented, should be compensated 

Government Investigations

lawsuits and government investigations involving 

litigation ﬁ led by the Orange County District Attorney 

for the alleged defects related to the antilock brak-

In February 2010, Toyota received a subpoena from 

Toyota in the United States relating to these recalls 

and the state attorneys general’s investigation 

ing system. These cases have been consolidated 

the U.S. Attorney for the Southern District of New 

and other safety measures.

 discussed below.

into two actions, one in the United States District 

York and a voluntary request and subpoena from 

  The settlement provides a customer support pro-

Court for the Central District of California and one in 

the SEC. The subpoenas and the voluntary request 

Class Action and Consolidated Litigation

gram covering certain vehicle parts, the free installa-

the Los Angeles County Superior Court. In January 

primarily seek documents related to unintended 

Approximately 200 putative class actions and more 

tion of a brake override system on the remaining 

2013, the Court in the federal case issued an order 

acceleration and certain ﬁ nancial records. This is 

than 500 individual product liability personal injury 

ﬂ oor mat entrapment safety campaign vehicles and 

denying the plaintiff’s motion for class certiﬁ cation 

a coordinated investigation and has included inter-

cases have been ﬁ led since November 2009 alleg-

funds for cash payments to customers who do not 

and granting summary judgment in favor of Toyota 

views of Toyota and non-Toyota witnesses, as well 

ing that certain Toyota, Lexus and Scion vehicles 

receive the brake override system, cash payments 

on the claims of the principal named plaintiff for the 

as production of documents. In June 2010, Toyota 

contain defects that lead to unintended accelera-

to individuals who allegedly suffered a loss on the 

cases relating to recalled vehicles. A class certiﬁ ca-

received a second voluntary request and subpoena 

tion. In April 2010, the approximately 190 putative 

sale, lease or insuring the residual value of Toyota’s 

tion hearing in connection with the claims related to 

from the SEC and a subpoena from the U.S. Attorney 

class actions in federal court as well as the federal 

vehicles and funds for safety-related research and 

those vehicles that were not recalled is scheduled in 

for the Southern District of New York seeking pro-

product liability personal injury cases and warranty 

education programs. The settlement does not cover 

July 2013.

duction of documents related to the recalls of the 

and lemon law cases were consolidated for pretrial 

product liability personal injury claims in the consoli-

  From February through March 2010, Toyota was 

steering relay rod. Toyota is cooperating with the 

proceedings into a single multi-district litigation in 

dated federal action or pending in various state 

sued in 6 putative shareholder class actions on 

U.S. Attorney’s Ofﬁ ce and SEC in their investigations, 

the United States District Court for the Central 

courts in the United States.

behalf of investors in Toyota ADRs and common 

which are on-going.

District of California. Approximately 10 putative 

In April 2013, Toyota announced that the court 

stock. The cases alleged violations of the Securities 

In June 2012, Toyota announced an amendment 

class actions and various product liability personal 

had approved an agreement to resolve the civil 

Exchange Act of 1934 and Japan’s Financial 

to the 2009 ﬂ oor mat entrapment safety campaign 

injury cases pending in state courts were subse-

action ﬁ led by the Orange County District Attorney 

Instruments and Exchange Act and were consoli-

to include model year 2010 RX350 and RX450h. 

quently consolidated into the federal action. The 

in California state court seeking, among other 

dated into a single action in the United States 

Toyota submitted additional documents related to 

remaining class actions lawsuits are pending in 

things, statutory penalties alleging that Toyota sold 

District Court for the Central District of California. 

this amendment pursuant to NHTSA’s request. In 

a consolidated state action in California.

and marketed defective vehicles in violation of vari-

The judge dismissed with prejudice the claims 

October 2012, Toyota ﬁ led an additional amend-

In December 2012, Toyota and the plaintiffs 

ous California statutes. The amount of the settle-

based on Japan’s Financial Instruments and Exchange 

ment to include model year 2008 through 2011 

announced that they had reached an agreement to 

ment, which was not material to Toyota, was 

Act, and Toyota reached an agreement to resolve 

Land Cruiser. In December 2012, Toyota announced 

settle the economic loss claims in the consolidated 

included in the charge taken in ﬁ scal 2013.

the claims asserted on behalf of purchasers of 

an agreement with NHTSA to resolve timeliness 

federal action. The court preliminarily approved the 

  Beginning in February 2010, Toyota was sued in 

Toyota’s ADRs for an amount not material to Toyota. 

claims related to the model year 2010 RX350 and 

agreement and held the ﬁ nal approval hearing in 

approximately 20 putative class actions alleging 

The court approved the settlement in March 2013.

RX450h safety campaign under which Toyota agreed 

June 2013. The court took the matter under 

defects in the antilock braking system in various 

to make a $17.4 million payment to the U.S. Treasury.

 
 
 
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P a g e  111

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [34 of 44]

Next

Notes to Consolidated Financial Statements

  Toyota also received subpoenas and formal and 

the United States. For the same reasons discussed 

in January 2007. Currently, there are uncertainties 

related to covered vehicles in existence as of March 

informal requests from various states’ attorneys 

above relating to the recall-related legal proceed-

surrounding the implementation of the applicable 

31, 2013. Depending on the legislation that will be 

general, including the Executive Committee for 

ings, Toyota is unable to estimate a range of rea-

regulations in different European Union member 

enacted subject to other circumstances, Toyota 

a group of 30 states’ plus one territory’s attorney 

sonably possible loss, if any, beyond the amounts 

states, particularly regarding manufacturer responsi-

may be required to revise the accruals for the 

general, and certain local governmental agencies 

accrued, with respect to these claims. Based upon 

bilities and resultant expenses that may be incurred.

expected costs. Although Toyota does not expect 

regarding various recalls, the facts underlying those 

information currently available to Toyota, however, 

In addition, under this directive member states 

its compliance with the directive to result in signiﬁ -

recalls and customer handling related to those 

Toyota believes that its losses from these matters, if 

must take measures to ensure that car manufactur-

cant cash expenditures, Toyota is continuing to assess 

recalls. In February 2013, Toyota and the attorneys 

any, would not have a material adverse effect on 

ers, distributors and other auto-related economic 

the impact of this future legislation on its ﬁ nancial posi-

general resolved these investigations for an amount 

Toyota’s ﬁ nancial position, results of operations or 

operators establish adequate used vehicle collection 

tion, results of operations and cash ﬂ ows.

not material to Toyota. Such amount was included 

cash ﬂ ows.

and treatment facilities and to ensure that hazardous 

  Toyota purchases materials that are equivalent to 

in the charge taken in ﬁ scal 2013. In connection 

materials and recyclable parts are removed from 

approximately 10% of material costs from a supplier 

with this settlement, Toyota also made commit-

Environmental Matters and Others

vehicles prior to shredding. This directive impacts 

which is an afﬁ liated company.

ments to continue to conduct certain activities it is 

In October 2000, the European Union brought into 

Toyota’s vehicles sold in the European Union and 

  The parent company has a concentration of labor 

already undertaking.

effect a directive that requires member states to 

Toyota is introducing vehicles that are in compliance 

supply in employees working under collective bar-

  Beyond the amounts accrued for the recall- 

promulgate regulations implementing the following: 

with such measures taken by the member states 

gaining agreements and a substantial portion of 

related matters, Toyota is unable to estimate a range 

(i) manufacturers shall bear all or a signiﬁ cant part of 

pursuant to the directive.

these employees are working under the agreement 

of reasonably possible loss, if any, for the other recall-

the costs for taking back end-of-life vehicles put on 

  Based on the legislation that has been enacted to 

that will expire on December 31, 2014.

related matters because (i) many of the proceedings 

the market after July 1, 2002 and dismantling and 

date, Toyota has provided for its estimated liability 

are in evidence gathering stages, (ii) signiﬁ cant fac-

recycling those vehicles. Beginning January 1, 

tual issues need to be resolved, (iii) the legal theory 

2007, this requirement became applicable to vehi-

or nature of the claims is unclear, (iv) the outcome of 

cles put on the market before July 1, 2002; (ii) man-

future motions or appeals is unknown and/or (v) the 

ufacturers may not use certain hazardous materials 

24. Segment data

outcomes of other matters of these types vary 

in vehicles to be sold after July 2003; (iii) vehicles 

The operating segments reported below are the 

distributes sedans, minivans, compact cars, sport-

widely and do not appear sufﬁ ciently similar to offer 

type-approved and put on the market after 

segments of Toyota for which separate ﬁ nancial 

utility vehicles, trucks and related parts and accesso-

meaningful guidance. Although Toyota cannot esti-

December 15, 2008, shall be re-usable and/or recy-

information is available and for which operating 

ries. The Financial Services segment consists primarily 

mate a reasonable range of loss based on currently 

clable to a minimum of 85% by weight per vehicle 

income/loss amounts are evaluated regularly by 

of ﬁ nancing, and vehicle and equipment leasing 

available information, the resolution of these matters 

and shall be re-usable and/or recoverable to a mini-

executive management in deciding how to allocate 

operations to assist in the merchandising of the parent 

could have an adverse effect on Toyota’s ﬁ nancial 

mum of 95% by weight per vehicle; and (iv) end-of-

resources and in assessing performance.

company and its afﬁ liated companies products as well 

position, results of operations or cash ﬂ ows.

life vehicles must meet actual re-use of 80% and 

  The major portions of Toyota’s operations on a 

as other products. The All Other segment includes 

re-use as material or energy of 85%, respectively, of 

worldwide basis are derived from the Automotive 

the design, manufacturing and sales of housing, tele-

Other Proceedings

vehicle weight by 2006, rising respectively to 85% 

and Financial Services business segments. The 

communications and other business.

Toyota has various other legal actions, other gov-

and 95% by 2015. A law to implement the directive 

Automotive segment designs, manufactures and 

ernmental proceedings and other claims pending 

came into effect in all member states including 

against it, including other product liability claims in 

Bulgaria, Romania that joined the European Union 

 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [35 of 44]

Next

Notes to Consolidated Financial Statements

  The following tables present certain information regarding Toyota’s industry segments and operations by 

As of and for the year ended March 31, 2013:

geographic areas and overseas revenues by destination as of and for the years ended March 31, 2011, 2012 

and 2013.

  Segment operating results and assets

As of and for the year ended March 31, 2011:

Yen in millions

Automotive

Financial 
Services 

All Other

Inter-segment 
Elimination/ 
Unallocated 
Amount

Consolidated

Net revenues
  Sales to external customers

Inter-segment sales and transfers

  Total

Operating expenses
Operating income
Assets
Investment in equity method investees
Depreciation expenses
Capital expenditure

 474,485
 972,252
 937,010

 19,037
 1,192,205
 833,925

 14,567
 17,337,320
 17,251,347

¥17,322,753  ¥  1,173,168  ¥   497,767  ¥            —  ¥18,993,688
 —
 (508,089)
 18,993,688
 (508,089)
 18,525,409
 (496,873)
 ¥       85,973  ¥     358,280  ¥     35,242  ¥    (11,216)
 ¥     468,279
 ¥11,341,558  ¥13,365,394  ¥1,146,720  ¥3,964,494  ¥29,818,166
 1,817,988
 —  1,175,573
 1,691,191

 1,784,539
 819,075
 691,867

 3,519
 330,865
 991,330

 3,045
 25,633
 21,058

 (13,064)

 26,885

As of and for the year ended March 31, 2012:

Yen in millions

Automotive

Financial 
Services 

All Other

Inter-segment 
Elimination/ 
Unallocated 
Amount

Consolidated

Net revenues
  Sales to external customers

Inter-segment sales and transfers

  Total

Operating expenses
Operating income
Assets
Investment in equity method investees
Depreciation expenses
Capital expenditure

 501,377
 1,048,915
 1,006,853

 28,587
 1,100,324
 793,886

 30,168
 16,994,546
 16,972,863

 ¥16,964,378  ¥  1,071,737  ¥   547,538  ¥            —  ¥18,583,653
 —
 (560,132)
 18,583,653
 (560,132)
 18,228,026
 (545,576)
 ¥       21,683  ¥     306,438  ¥     42,062  ¥    (14,556)
 ¥     355,627
 ¥12,261,814  ¥13,172,548  ¥1,161,224  ¥4,055,379  ¥30,650,965
 1,914,129
 —  1,067,830
 1,532,082

 1,877,720
 744,067
 796,839

 3,887
 298,757
 683,161

 4,765
 25,006
 35,340

 16,742

 27,757

Yen in millions

Automotive

Financial 
Services 

All Other

Inter-segment 
Elimination/ 
Unallocated 
Amount

Consolidated

Net revenues
  Sales to external customers

Inter-segment sales and transfers

  Total

Operating expenses
Operating income
Assets
Investment in equity method investees
Depreciation expenses
Capital expenditure

 20,628
 1,170,670
 854,850

 40,338
 20,419,100
 19,474,396

 ¥20,378,762  ¥  1,150,042  ¥   535,388  ¥            —  ¥22,064,192
 —
 531,073
 22,064,192
 1,066,461
 20,743,304
 1,012,845
 ¥     944,704  ¥     315,820  ¥     53,616  ¥       6,748  ¥  1,320,888
 ¥13,179,741  ¥16,231,473  ¥1,310,115  ¥4,761,988  ¥35,483,317
 2,102,584
 —  1,105,109
 1,974,152

 2,033,040
 745,880
 937,695

 4,925
 336,528
 1,005,326

 (592,039)
 (592,039)
 (598,787)

 6,968
 22,701
 29,286

 57,651

 1,845

U.S. dollars in millions

Net revenues
  Sales to external customers

Inter-segment sales and transfers

  Total

Operating expenses
Operating income
Assets
Investment in equity method investees
Depreciation expenses
Capital expenditure

Automotive

 $216,680
 429
 217,109
 207,064
 $  10,045
 $140,135
 21,617
 7,931
 9,970

Financial 
Services 

 $  12,228
 219
 12,447
 9,089
 $    3,358
 $172,583
 52
 3,578
 10,689

All Other

 $  5,693
 5,646
 11,339
 10,769
 $     570
 $13,930
 74
 241
 311

Inter-segment 
Elimination/ 
Unallocated 
Amount

$        —
 (6,294)
 (6,294)
 (6,366)
 $       72
 $50,633
 613
 —
 20

Consolidated

 $234,601
 —
 234,601
 220,556
 $  14,045
 $377,281
 22,356
 11,750
 20,990

 
 
 
 
 
 
 
 
 
 
 
 
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Toyota Global Vision

President’s Message

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Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [36 of 44]

Next

Notes to Consolidated Financial Statements

  Geographic Information

As of and for the year ended March 31, 2011:

As of and for the year ended March 31, 2013:

Yen in millions

Japan

North 
America

Europe

Asia

Other

Inter-segment 
Elimination/ 
Unallocated 
Amount

Consolidated

Net revenues

Net revenues

  Sales to external customers

Inter-segment sales and transfers

  Total

  Operating expenses
  Operating income (loss)
  Assets
  Long-lived assets

 101,327
 5,429,136
 5,089,633

 4,019,317
 10,986,246
 11,348,642

 ¥  6,966,929  ¥5,327,809  ¥1,920,416  ¥3,138,112  ¥1,640,422  ¥            —  ¥18,993,688
 —
 236,422
 18,993,688
 3,374,534
 18,525,409
 3,061,557
 ¥    (362,396)  ¥   339,503  ¥     13,148  ¥   312,977  ¥   160,129  ¥       4,918  ¥     468,279
 ¥11,285,864  ¥9,910,828  ¥1,931,231  ¥2,138,499  ¥2,044,379  ¥2,507,365  ¥29,818,166
 —  6,309,160

 (4,586,841)
 (4,586,841)
 (4,591,759)

 168,694
 1,809,116
 1,648,987

 61,081
 1,981,497
 1,968,349

 2,276,332

 3,123,042

 259,855

 344,304

 305,627

  Sales to external customers

Inter-segment sales and transfers

  Total

Operating expenses
Operating income 
Assets
Long-lived assets

As of and for the year ended March 31, 2012:

Yen in millions

Japan

North 
America

Europe

Asia

Other

Inter-segment 
Elimination/ 
Unallocated 
Amount

Consolidated

Net revenues

  Sales to external customers

Inter-segment sales and transfers

Net revenues

  Sales to external customers

Inter-segment sales and transfers

  Total

Operating expenses
Operating income (loss)
Assets
Long-lived assets

 107,538
 4,751,886
 4,565,477

 3,873,515
 11,167,319
 11,374,359

 ¥  7,293,804  ¥4,644,348  ¥1,917,408  ¥3,116,849  ¥1,611,244  ¥            —  ¥18,583,653
 —
 217,425
 18,583,653
 3,334,274
 18,228,026
 3,077,484
 ¥    (207,040)  ¥   186,409  ¥     17,796  ¥   256,790  ¥   108,814  ¥      (7,142)  ¥     355,627
 ¥12,034,423  ¥9,693,232  ¥1,960,532  ¥2,433,312  ¥2,175,493  ¥2,353,973  ¥30,650,965
 —  6,235,380

 (4,423,947)
 (4,423,947)
 (4,416,805)

 148,931
 1,760,175
 1,651,361

 76,538
 1,993,946
 1,976,150

 2,197,197

 2,981,985

 412,959

 380,169

 263,070

  Total

Operating expenses
Operating income 
Assets
Long-lived assets

Yen in millions

Japan

North 
America

Europe

Asia

Other

Inter-segment 
Elimination/ 
Unallocated 
Amount

Consolidated

 116,604
 6,284,425
 6,062,500

 4,910,562
 12,821,018
 12,244,683

 ¥  7,910,456  ¥  6,167,821  ¥2,003,113  ¥4,058,629  ¥1,924,173  ¥             —  ¥22,064,192
 —
 326,847
 22,064,192
 4,385,476
 20,743,304
 4,009,421
 ¥     576,335  ¥     221,925  ¥     26,462  ¥   376,055  ¥   133,744  ¥    (13,633)  ¥  1,320,888
 ¥12,296,731  ¥11,841,471  ¥2,199,256  ¥3,305,319  ¥2,616,164  ¥3,224,376  ¥35,483,317
 —  6,851,239

 (5,604,105)
 (5,604,105)
 (5,590,472)

 170,092
 2,094,265
 1,960,521

 80,000
 2,083,113
 2,056,651

 2,633,067

 2,929,346

 410,517

 590,021

 288,288

U.S. dollars in millions

Japan

North 
America

Europe

Asia

Other

Inter-segment 
Elimination/ 
Unallocated 
Amount

 $  84,109
 52,212
 136,321
 130,193
 $    6,128
 $130,747
 31,147

 $  65,580
 1,240
 66,820
 64,460
 $    2,360
 $125,906
 27,996

 $21,299
 850
 22,149
 21,868
 $     281
 $23,384
 3,065

 $43,154
 3,475
 46,629
 42,630
 $  3,999
 $35,144
 6,274

 $20,459
 1,809
 22,268
 20,846
 $  1,422
 $27,817
 4,365

$        —
 (59,586)
 (59,586)
 (59,441)
 $    (145)
 $34,283
 —

Consolidated

 $234,601
 —
 234,601
 220,556
 $  14,045
 $377,281
 72,847

“Other” consists of Central and South America, Oceania and Africa.

  Revenues are attributed to geographies based on 

marketable securities. Such corporate assets were 

the country location of the parent company or 

¥4,613,672 million, ¥4,749,259 million and 

the˛subsidiary that transacted the sale with the 

¥5,599,970 million ($59,542 million), as of March 

external customer.

31, 2011, 2012 and 2013, respectively.

  There are no any individually material countries 

  Transfers between industries or geographic 

with respect to revenues, and long-lived assets 

 segments are made at amounts which Toyota’s 

included in other foreign countries.

management believes approximate arm’s-length 

  Unallocated amounts included in assets represent 

transactions. In measuring the reportable segments’ 

assets held for corporate purposes, which mainly 

income or losses, operating income consists of rev-

consist of cash and cash equivalents and 

enue less operating expenses.

 
 
 
 
 
 
 
 
 
 
 
 
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P a g e  114

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [37 of 44]

Next

Notes to Consolidated Financial Statements

  Overseas Revenues by destination

Balance sheets

The following information shows revenues that are 

the disclosure requirements under U.S. GAAP, 

attributed to countries based on location of custom-

Toyota discloses this information in order to provide 

ers, excluding customers in Japan. In addition to 

ﬁ nancial statements users with valuable information.

North America
Europe
Asia
Other

Yen in millions

2011 
 ¥5,398,278
 1,793,932
 3,280,384
 3,196,114

For the years ended March 31,
2012 
 ¥4,715,804
 1,817,944
 3,284,392
 3,103,383

2013 
 ¥6,790,453
 1,901,118
 3,940,175
 3,929,775

U.S. dollars in millions
For the year ended 
March 31,
2013
 $72,200
 20,214
 41,894
 41,784

“Other” consists of Central and South America, Oceania, Africa and the Middle East, etc.

Non-Financial Services Businesses
  Current assets

  Cash and cash equivalents
  Marketable securities

 Trade accounts and notes receivable, 
  less allowance for doubtful accounts
Inventories

  Prepaid expenses and other current assets

  Total current assets

Investments and other assets
  Property, plant and equipment

  Certain ﬁ nancial statements data on non-ﬁ nancial services and ﬁ nancial services businesses

  Total Non-Financial Services Businesses assets

The ﬁ nancial data below presents separately Toyota’s non-ﬁ nancial services and ﬁ nancial services businesses.

Financial Services Businesses
  Current assets

  Cash and cash equivalents
  Marketable securities
  Finance receivables, net
  Prepaid expenses and other current assets

  Total current assets

  Noncurrent ﬁ nance receivables, net

Investments and other assets
  Property, plant and equipment

  Total Financial Services Businesses assets

  Eliminations

  Total assets

Yen in millions
March 31, 

2012 

2013 

U.S. dollars in millions
March 31,
2013

 ¥  1,104,636
 1,015,626

 ¥  1,107,409
 1,204,447

 $  11,775
 12,806

 2,031,472
 1,622,154
 1,464,124
 7,238,012
 6,218,377
 4,510,716
 17,967,105

 2,033,831
 1,715,634
 1,597,514
 7,658,835
 7,462,767
 4,741,357
 19,862,959

 574,564
 165,444
 4,114,897
 685,611
 5,540,516
 5,602,462
 304,906
 1,724,664
 13,172,548
 (488,688)
 ¥30,650,965

 610,888
 241,216
 5,117,660
 693,036
 6,662,800
 6,943,766
 515,025
 2,109,882
 16,231,473
 (611,115)
 ¥35,483,317

 21,625
 18,242
 16,986
 81,434
 79,349
 50,413
 211,196

 6,495
 2,565
 54,414
 7,369
 70,843
 73,830
 5,476
 22,434
 172,583
 (6,498)
 $377,281

* Assets in the non-ﬁ nancial services include unallocated corporate assets.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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P a g e  115

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [38 of 44]

Next

Notes to Consolidated Financial Statements

Yen in millions
March 31, 

2012 

2013 

U.S. dollars in millions
March 31,
2013

Statements of income

Non-Financial Services Businesses
  Current liabilities

  Short-term borrowings
  Current portion of long-term debt
  Accounts payable
  Accrued expenses

Income taxes payable
  Other current liabilities

  Total current liabilities

  Long-term liabilities
  Long-term debt
  Accrued pension and severance costs
  Other long-term liabilities

  Total long-term liabilities
  Total Non-Financial Services Businesses liabilities

Financial Services Businesses
  Current liabilities

  Short-term borrowings
  Current portion of long-term debt
  Accounts payable
  Accrued expenses

Income taxes payable
  Other current liabilities

  Total current liabilities

 ¥     715,019
339,441
2,234,316
1,737,490
123,344
1,175,801
6,325,411

 ¥     576,685
185,582
2,092,722
2,092,102
140,935
1,186,870
6,274,896

503,070
700,211
531,982
1,735,263
8,060,674

3,040,373
2,218,526
27,095
96,247
10,434
536,291
5,928,966

521,428
754,360
969,668
2,245,456
8,520,352

3,861,699
2,538,249
37,655
105,901
15,331
632,025
7,190,860

  Long-term liabilities
  Long-term debt
  Accrued pension and severance costs
  Other long-term liabilities

  Total long-term liabilities
  Total Financial Services Businesses liabilities

  Eliminations

  Total liabilities

  Total Toyota Motor Corporation shareholders’ equity
  Noncontrolling interests

  Total shareholders’ equity
  Total liabilities and shareholders’ equity

5,555,112
8,191
520,252
6,083,555
12,012,521
(488,708)
19,584,487
10,550,261
516,217
11,066,478
¥30,650,965

6,876,849
11,752
724,337
7,612,938
14,803,798
(613,689)
22,710,461
12,148,035
624,821
12,772,856
¥35,483,317

$    6,132
1,973
22,251
22,245
1,499
12,619
66,719

5,544
8,021
10,310
23,875
90,594

41,060
26,988
400
1,126
163
6,720
76,457

73,119
125
7,702
80,946
157,403
(6,525)
241,472
129,166
6,643
135,809
$377,281

Non-Financial Services Businesses
  Net revenues
  Costs and expenses
  Cost of revenues
  Selling, general and administrative

  Total costs and expenses

  Operating income
  Other income (expense), net

 Income before income taxes and equity 
  in earnings of afﬁ liated companies

  Provision for income taxes
  Equity in earnings of afﬁ liated companies
  Net income

 Less: Net income attributable to 
  noncontrolling interests
 Net income attributable to Toyota Motor 
   Corporation—Non-Financial Services 
Businesses

Financial Services Businesses
  Net revenues
  Costs and expenses
  Cost of revenues
  Selling, general and administrative

  Total costs and expenses

  Operating income
  Other income (expense), net

 Income before income taxes and equity 
  in earnings of afﬁ liated companies

  Provision for income taxes
  Equity in earnings of afﬁ liated companies
  Net income

 Less: Net income attributable to 
  noncontrolling interests
 Net income attributable to Toyota Motor 
   Corporation—Financial Services 
Businesses
  Eliminations

 Net income attributable to Toyota Motor 
  Corporation

Yen in millions

For the years ended March 31,
2012 

2011 

2013 

U.S. dollars in millions
For the year 
ended March 31,
2013

¥17,826,986

¥17,534,872

¥20,943,634

$222,686

15,986,741
1,723,071
17,709,812
117,174
88,840

15,796,635
1,676,999
17,473,634
61,238
69,935

206,014
178,795
214,229
241,448

131,173
141,558
196,544
186,159

18,034,256
1,899,997
19,934,253
1,009,381
79,837

1,089,218
436,223
230,078
883,073

191,752
20,202
211,954
10,732
849

11,581
4,638
2,446
9,389

(54,055)

(82,181)

(119,359)

(1,269)

187,393

103,978

763,714

8,120

1,192,205

1,100,324

1,170,670

12,447

636,374
197,551
833,925
358,280
1,349

359,629
134,094
787
226,322

615,563
178,323
793,886
306,438
(4,679)

301,759
120,725
1,157
182,191

633,306
221,544
854,850
315,820
(970)

314,850
116,033
1,441
200,258

6,734
2,355
9,089
3,358
(10)

3,348
1,234
15
2,129

(3,251)

(2,566)

(1,961)

(21)

223,071
(2,281)

179,625
(44)

198,297
152 

2,108
2

¥     408,183

¥     283,559

¥     962,163

$  10,230

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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P a g e  116

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [39 of 44]

Next

Notes to Consolidated Financial Statements

Statements of cash ﬂ ows

Cash ﬂ ows from operating activities
  Net income
  Adjustments to reconcile net income to net cash provided by operating activities

  Depreciation
  Provision for doubtful accounts and credit losses
  Pension and severance costs, less payments
  Losses on disposal of ﬁ xed assets
  Unrealized losses on available-for-sale securities, net
  Deferred income taxes
  Equity in earnings of afﬁ liated companies
  Changes in operating assets and liabilities, and other

  Net cash provided by operating activities

Cash ﬂ ows from investing activities
  Additions to ﬁ nance receivables
  Collection of and proceeds from sales of ﬁ nance receivables
  Additions to ﬁ xed assets excluding equipment leased to others
  Additions to equipment leased to others
  Proceeds from sales of ﬁ xed assets excluding equipment leased to others
  Proceeds from sales of equipment leased to others
  Purchases of marketable securities and security investments
  Proceeds from sales of and maturity of marketable securities and security investments
  Payment for additional investments in afﬁ liated companies, net of cash acquired
  Changes in investments and other assets, and other

  Net cash used in investing activities

Cash ﬂ ows from ﬁ nancing activities
  Proceeds from issuance of long-term debt
  Payments of long-term debt

Increase (decrease) in short-term borrowings

  Dividends paid
  Purchase of common stock, and other

  Net cash provided by (used in) ﬁ nancing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

Non-Financial 
Services Businesses

Yen in millions
For the year ended March 31, 2011
Financial 
Services Businesses

Consolidated

Non-Financial 
Services Businesses

Yen in millions
For the year ended March 31, 2012
Financial Services 
Businesses

Consolidated

¥   241,448

¥     226,322

¥   465,485

¥   186,159

¥     182,191

¥   368,302

844,708
1,806
(24,867)
36,076
7,915
(17,258)
(214,229)
591,378
1,466,977

—
—
(621,302)
(78,559)
50,742
17,700
(4,063,499)
3,423,618
(299)
394,479
(877,120)

15,318
(309,862)
(86,884)
(141,120)
(28,617)
(551,165)
(76,960)
(38,268)
1,338,821
¥1,300,553

330,865
2,334
1,453
138
—
103,035
(787)
(106,416)
556,944

(14,323,261)
13,887,751
(8,024)
(983,306)
600
468,995
(358,308)
292,538
—
18,303
(1,004,712)

2,934,588
(2,306,139)
122,619
—
—
751,068
(50,069)
253,231
526,925
¥     780,156

1,175,573
4,140
(23,414)
36,214
7,915
85,710
(215,016)
487,402
2,024,009

(8,438,785)
8,003,940
(629,326)
(1,061,865)
51,342
486,695
(4,421,807)
3,716,156
(299)
177,605
(2,116,344)

2,931,436
(2,489,632)
162,260
(141,120)
(28,617)
434,327
(127,029)
214,963
1,865,746
¥2,080,709

769,073
5,843
15,410
33,448
53,831
(82,792)
(196,544)
182,931
967,359

—
—
(713,867)
(135,054)
36,203
20,689
(2,565,772)
2,227,812
(147)
213,957
(916,179)

39,803
(294,646)
238,072
(156,785)
(37,448)
(211,004)
(36,093)
(195,917)
1,300,553
¥1,104,636

298,757
3,780
1,301
80
—
89,199
(1,157)
(73,020)
501,131

(13,455,792)
13,168,058
(9,670)
(673,491)
430
410,624
(607,862)
629,013
—
(12,206)
(550,896)

2,379,152
(2,608,135)
93,002
—
—
(135,981)
(19,846)
(205,592)
780,156
¥     574,564

1,067,830
9,623
16,711
33,528
53,831
6,395
(197,701)
93,916
1,452,435

(8,333,248)
8,061,710
(723,537)
(808,545)
36,633
431,313
(3,173,634)
2,856,825
(147)
209,972
(1,442,658)

2,394,807
(2,867,572)
311,651
(156,785)
(37,448)
(355,347)
(55,939)
(401,509)
2,080,709
¥1,679,200

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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P a g e  117

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [40 of 44]

Next

Notes to Consolidated Financial Statements

Cash ﬂ ows from operating activities
  Net income
  Adjustments to reconcile net income to net cash provided by operating activities

  Depreciation
  Provision for doubtful accounts and credit losses
  Pension and severance costs, less payments
  Losses on disposal of ﬁ xed assets
  Unrealized losses on available-for-sale securities, net
  Deferred income taxes
  Equity in earnings of afﬁ liated companies
  Changes in operating assets and liabilities, and other

  Net cash provided by operating activities

Cash ﬂ ows from investing activities
  Additions to ﬁ nance receivables
  Collection of and proceeds from sales of ﬁ nance receivables
  Additions to ﬁ xed assets excluding equipment leased to others
  Additions to equipment leased to others
  Proceeds from sales of ﬁ xed assets excluding equipment leased to others
  Proceeds from sales of equipment leased to others
  Purchases of marketable securities and security investments
  Proceeds from sales of and maturity of marketable securities and security investments
  Payment for additional investments in afﬁ liated companies, net of cash acquired
  Changes in investments and other assets, and other

  Net cash used in investing activities

Cash ﬂ ows from ﬁ nancing activities
  Proceeds from issuance of long-term debt
  Payments of long-term debt

Increase (decrease) in short-term borrowings

  Dividends paid
  Purchase of common stock, and other

  Net cash provided (used in) ﬁ nancing activities

Effect of exchange rate changes on cash and cash equivalents
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

Yen in millions
For the year ended March 31, 2013
Financial 
Services Businesses

Non-Financial 
Services Businesses

Consolidated

U.S. dollars in millions
For the year ended March 31, 2013
Financial Services 
Businesses

Non-Financial 
Services Businesses

Consolidated

¥   883,073

¥     200,258

¥  1,083,482

$  9,389

$    2,129

$  11,520

768,581
1,745
(23,514)
32,005
2,104
89,834
(230,078)
472,514
1,996,264

—
—
(839,756)
(129,070)
38,051
68,571
(2,980,821)
2,285,566
16,216
17,206
(1,524,037)

182,114
(328,380)
(162,782)
(190,008)
(43,098)
(542,154)
72,700
2,773
1,104,636
¥1,107,409

336,528
25,622
3,085
216
—
70,743
(1,441)
32,066
667,077

(16,877,678)
15,784,681
(14,805)
(990,521)
1,140
464,870
(431,602)
383,525
—
(77,848)
(1,758,238)

3,089,484
(2,415,566)
388,416
—
—
1,062,334
65,151
36,324
574,564
¥     610,888

1,105,109
27,367
(20,429)
32,221
2,104
160,008
(231,519)
292,973
2,451,316

(10,004,928)
9,102,856
(854,561)
(1,119,591)
39,191
533,441
(3,412,423)
2,669,091
16,216
3,396
(3,027,312)

3,191,223
(2,682,136)
201,261
(190,008)
(43,098)
477,242
137,851
39,097
1,679,200
¥  1,718,297

8,172
19
(250)
341
22
955
(2,446)
5,024
21,226

—
—
(8,929)
(1,372)
405
729
(31,694)
24,301
172
183
(16,205)

1,937
(3,492)
(1,731)
(2,020)
(458)
(5,764)
773
30
11,745
$11,775

3,578
272
33
2
—
753
(15)
341
7,093

(179,454)
167,832
(157)
(10,532)
12
4,943
(4,589)
4,078
—
(828)
(18,695)

32,849
(25,684)
4,130
—
—
11,295
693
386
6,109
$    6,495

11,750
291
(217)
343
22
1,701
(2,461)
3,115
26,064

(106,379)
96,788
(9,086)
(11,904)
417
5,672
(36,283)
28,379
172
36
(32,188)

33,931
(28,518)
2,139
(2,020)
(458)
5,074
1,466
416
17,854
$  18,270

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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P a g e  118

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [41 of 44]

Next

Notes to Consolidated Financial Statements

25. Per share amounts

Reconciliations of the differences between basic and diluted net income attributable to Toyota Motor 

Corporation per share for the years ended March 31, 2011, 2012 and 2013 are as follows:

Yen in millions

Thousands of 
shares

Net income 
attributable to 
Toyota Motor 
Corporation

Weighted-
average 
shares

Yen
Net income 
attributable to 
Toyota Motor 
Corporation 
per share

U.S. dollars 
in millions

Net income 
attributable to 
Toyota Motor 
Corporation

U.S. dollars
Net income 
attributable to 
Toyota Motor 
Corporation 
per share

  The following table shows Toyota Motor Corporation shareholders’ equity per share as of March 31, 2012 

and 2013. Toyota Motor Corporation shareholders’ equity per share amounts are calculated by dividing Toyota 

Motor Corporation shareholders’ equities’ amount at the end of each period by the number of shares issued 

and outstanding, excluding treasury stock at the end of the corresponding period.

Yen in millions

Toyota Motor 
Corporation 
Shareholders’ 
equity
¥10,550,261
12,148,035

Thousands of 
shares
Shares issued 
and outstanding at
the end of the year 
(excluding treasury 
stock)
3,166,810
3,167,429

Yen 
Toyota Motor 
Corporation 
Shareholders’ 
equity
per share
¥3,331.51
3,835.30

U.S. dollars 
in millions

Toyota Motor 
Corporation 
Shareholders’ 
equity

U.S. dollars

Toyota Motor 
Corporation 
Shareholders’ 
equity
per share

$129,166

$40.78

For the year ended March 31, 2011
Basic net income attributable to Toyota 
  Motor Corporation per common share
  Effect of dilutive securities

¥408,183

3,135,881

¥130.17

As of March 31, 2012
As of March 31, 2013

  Assumed exercise of dilutive stock options

(0)

34

Diluted net income attributable to Toyota 
  Motor Corporation per common share
For the year ended March 31, 2012
Basic net income attributable to Toyota 
  Motor Corporation per common share
  Effect of dilutive securities

¥408,183

3,135,915

¥130.16

26. Fair value measurements

¥283,559

3,143,470

¥  90.21

to measure it.

  Level 1:  Quoted prices in active markets for identical assets or liabilities

In accordance with U.S. GAAP, Toyota classiﬁ es fair value into three levels of input as follows which are used 

  Assumed exercise of dilutive stock options

(3)

0

  Level 2:  Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar 

assets or liabilities in markets that are not active; inputs other than quoted prices that are observ-

able for the assets or liabilities

  Level 3:  Unobservable inputs for assets or liabilities

Diluted net income attributable to Toyota 
  Motor Corporation per common share
For the year ended March 31, 2013
Basic net income attributable to Toyota 
  Motor Corporation per common share
  Effect of dilutive securities

¥283,556

3,143,470

¥  90.20

¥962,163

3,166,909

¥303.82

$10,230

$3.23

  Assumed exercise of dilutive stock options

(32)

246

(0)

Diluted net income attributable to Toyota 
  Motor Corporation per common share

¥962,131

3,167,155

¥303.78

$10,230

$3.23

  Stock options that were not included in the com-

exercise prices were greater than the average 

putation of diluted net income attributable to Toyota 

 market price per common share during the period.

Motor Corporation per share for the years ended 

In addition to the disclosure requirements under 

March 31, 2011, 2012 and 2013 were 12,403 thou-

U.S. GAAP, Toyota discloses the information below 

sand shares, 12,530 thousand shares and 8,682 

in order to provide ﬁ nancial statements users with 

thousand shares, respectively, because the options’ 

valuable information.

 
 
 
 
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P a g e  119

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [42 of 44]

Next

Assets:
  Cash equivalents
  Time deposits

 Marketable securities and other 
  securities investments
  Public and corporate bonds
  Common stocks
  Other

  Derivative ﬁ nancial instruments

  Total

Liabilities:
  Derivative ﬁ nancial instruments

  Total

U.S. dollars in millions
March 31, 2013

Level 1 

Level 2 

Level 3 

Total

$  2,608
—

$  3,997
612

$   —
—

$  6,605
612

39,909
14,898
529
—
$57,944

$       —
$       —

8,430
—
5,518
2,315
$20,872

$ (2,088)
$ (2,088)

73
—
—
75
$148

$ (21)
$ (21)

48,412
14,898
6,047
2,390
$78,964

$ (2,109)
$ (2,109)

Notes to Consolidated Financial Statements

  The following table summarizes the fair values of the assets and liabilities measured at fair value on a recur-

ring basis at March 31, 2012 and 2013. Transfers between levels of the fair value are recognized at the end of 

their respective reporting periods:

Assets:
  Cash equivalents
  Time deposits

 Marketable securities and other 
  securities investments
  Public and corporate bonds
  Common stocks
  Other

  Derivative ﬁ nancial instruments

  Total

Liabilities:
  Derivative ﬁ nancial instruments

  Total

Assets:
  Cash equivalents
  Time deposits

 Marketable securities and other 
  securities investments
  Public and corporate bonds
  Common stocks
  Other

  Derivative ﬁ nancial instruments

  Total

Liabilities:
  Derivative ﬁ nancial instruments

  Total

Yen in millions
March 31, 2012

Level 1 

Level 2 

Level 3 

Total

¥   485,119
—

¥   223,385
50,000

¥      —
—

¥   708,504
50,000

3,389,882
1,034,319
40,619
—
¥4,949,939

237,934
—
428,737
289,931
¥1,229,987

1,684
—
—
7,565
¥ 9,249

3,629,500
1,034,319
469,356
297,496
¥6,189,175

¥            — ¥  (180,347)
¥            — ¥  (180,347)

¥(2,826)
¥(2,826)

¥  (183,173)
¥  (183,173)

Yen in millions
March 31, 2013

Level 1 

Level 2 

Level 3 

Total

¥   245,264
—

¥   375,941
57,572

¥        —
—

¥   621,205
57,572

3,753,451
1,401,183
49,731
—
¥5,449,629

792,806
—
518,955
217,745
¥1,963,019

6,889
—
—
7,083
¥13,972

4,553,146
1,401,183
568,686
224,828
¥7,426,620

¥            — ¥  (196,386)
¥            — ¥  (196,386)

¥ (1,956)
¥ (1,956)

¥  (198,342)
¥  (198,342)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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P a g e  120

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [43 of 44]

Next

Notes to Consolidated Financial Statements

  The following is description of the assets and lia-

respectively. Toyota uses primarily quoted market 

  The following table summarizes the changes in Level 3 assets and liabilities measured at fair value on 

bilities measured at fair value, information about the 

prices for identical assets to measure fair value of 

a recurring basis for the periods ended March 31, 2011, 2012 and 2013:

valuation techniques used to measure fair value, key 

these securities. “Other” includes primarily invest-

inputs and signiﬁ cant assumption:

ment trusts. Generally, Toyota uses quoted market 

  Cash equivalents and time deposits

ket prices for identical assets to measure fair value 

Cash equivalents include money market funds and 

of these securities. These assets are classiﬁ ed in 

prices for similar assets or quoted non-active mar-

other investments with original maturities of three 

Level 2.

months or less. Cash equivalents classiﬁ ed in Level 

2 include primarily negotiable certiﬁ cate of deposit 

  Derivative ﬁ nancial instruments

with original maturities of three months or less. 

See note 20 to the consolidated ﬁ nancial state-

These are measured at fair value using observable 

ments about derivative ﬁ nancial instruments. Toyota 

interest rates in the market. Time deposits include 

estimates the fair value of derivative ﬁ nancial instru-

negotiable certiﬁ cate of deposit with original maturi-

ments using industry-standard valuation models 

ties over three months. These are measured at fair 

that require observable inputs including interest 

value using observable interest rates in the market.

rates and foreign exchange rates, and the contrac-

tual terms. The usage of these models does not 

  Marketable securities and 

require signiﬁ cant judgment to be applied. These 

other securities investments

derivative ﬁ nancial instruments are classiﬁ ed in Level 

Marketable securities and other securities invest-

2. In other certain cases when market data is not 

ments include public and corporate bonds, com-

available, key inputs to the fair value measurement 

mon stocks and other investments. Public and 

include quotes from counterparties, and other mar-

corporate bonds include primarily government 

ket data. Toyota assesses the reasonableness of 

bonds and represent 60% of Japanese bonds, and 

changes of the quotes using observable market 

40% of U.S., European and other bonds as of 

data. These derivative ﬁ nancial instruments are clas-

March 31, 2012, and 49% of Japanese bonds, and 

siﬁ ed in Level 3. Toyota’s derivative fair value mea-

51% of U.S., European and other bonds as of 

surements consider assumptions about 

March 31, 2013. Listed stocks on the Japanese 

counterparty and our own non-performance risk, 

stock markets represent 83% and 85% of common 

using such as credit default probabilities.

stocks as of March 31, 2012 and 2013, 

Balance at beginning of year
  Total gains (losses)

Included in earnings
Included in other comprehensive income (loss)

  Purchases, issuances and settlements
  Other
Balance at end of year

Balance at beginning of year
  Total gains (losses)

Included in earnings
Included in other comprehensive income (loss)

  Purchases and issuances
  Settlements
  Other
Balance at end of year

Yen in millions
For the year ended March 31, 2011

Marketable 
securities and 
other securities 
investments
¥13,134

433
779
(810)
(13,536)
¥        —

Derivative 
ﬁ nancial 
instruments
¥  5,892

31,338
—
(8,381)
(22,055)
¥  6,794

Total
¥19,026

31,771
779
(9,191)
(35,591)
¥  6,794

Yen in millions
For the year ended March 31, 2012

Marketable 
securities and 
other securities 
investments
¥      —

Derivative 
ﬁ nancial 
instruments
¥6,794

—
—
—
—
1,684
¥1,684

6,476
—
—
(3,832)
(4,699)
¥4,739

Total
¥6,794

6,476
—
—
(3,832)
(3,015)
¥6,423

 
 
 
 
 
 
 
 
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P a g e  121

Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements [44 of 44]

Next

Notes to Consolidated Financial Statements

Yen in millions
For the year ended March 31, 2013

  “Included in earnings” in marketable securities 

and includes the currency translation adjustments 

and other securities investments and derivative 

for the year ended March 31, 2013.

Balance at beginning of year
  Total gains (losses)

Included in earnings
Included in other comprehensive income (loss)

  Purchases and issuances
  Settlements
  Other
Balance at end of year

Balance at beginning of year
  Total gains (losses)

Included in earnings
Included in other comprehensive income (loss)

  Purchases and issuances
  Settlements
  Other
Balance at end of year

Marketable 
securities and 
other securities 
investments
¥1,684

24
58
3,607
(1,563)
3,079
¥6,889

Derivative 
ﬁ nancial 
instruments
¥4,739

2,118
—
—
(2,343)
613
¥5,127

Total
¥  6,423

2,142
58
3,607
(3,906)
3,692
¥12,016

U.S. dollars in millions
For the year ended March 31, 2013

Marketable 
securities and 
other securities 
investments
$18

Derivative 
ﬁ nancial 
instruments
$50

0
1
38
(16)
32
$73

22
—
—
(25)
7
$54

Total
$  68

22
1
38
(41)
39
$127

ﬁ nancial instruments are included in “Other income 

  As of March 31, 2013, the Level 3 assets and lia-

(loss), net” and “Cost of ﬁ nancing operations” in 

bilities measured at fair value on a recurring basis 

the accompanying consolidated statements of 

are not signiﬁ cant.

income, respectively.

  Certain assets and liabilities are measured at fair 

In the reconciliation table above, derivative ﬁ nan-

value on a nonrecurring basis. During the years 

cial instruments are presented net of assets and lia-

ended March 31, 2012 and 2013, Toyota measured 

bilities. The other amount includes consolidated 

certain ﬁ nance receivables at fair value of ¥32,056 

retained interests in securitized ﬁ nancial receivables 

million and ¥32,974 million ($351 million) based on 

of ¥(13,165) million, certain derivative ﬁ nancial 

the collateral value, resulting in gains of ¥1,736 mil-

instruments transferred into Level 2 due to be mea-

lion and ¥978 million ($10 million). This fair value 

sured at observable inputs of ¥(21,413) million and 

measurement on a nonrecurring basis is classiﬁ ed in 

the impact of currency translation adjustments for 

Level 3. See note 21 to the consolidated ﬁ nancial 

the year ended March 31, 2011, and includes the 

statements for the fair value measurement. These 

impacts of level transfers and currency translation 

Level 3 ﬁ nancial assets are not signiﬁ cant.

adjustments for the year ended March 31, 2012, 

 
 
 
 
 
 
 
 
 
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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements 

Next

Management’s Annual Report on Internal Control over Financial Reporting

　Toyota’s management is responsible for 

  Because of its inherent limitations, internal control 

establishing and maintaining effective internal 

over ﬁ nancial reporting may not prevent or detect 

control over ﬁ nancial reporting. Internal control over 

misstatements. Also, projections of any evaluation 

ﬁ nancial reporting is a process designed to provide 

of effectiveness to future periods are subject to the 

reasonable assurance regarding the reliability of 

risk that controls may become inadequate because 

ﬁ nancial reporting and the preparation of ﬁ nancial 

of changes in conditions, or that the degree of 

statements for external purposes in accordance 

compliance with the policies or procedures may 

with U.S. GAAP. Toyota’s internal control over 

deteriorate.

ﬁ nancial reporting includes those policies and 

  Toyota’s management conducted an evaluation of 

procedures that:

the effectiveness of internal control over ﬁ nancial 

1)  pertain to the maintenance of records that in 

reporting based on the framework in “Internal 

reasonable detail, accurately and fairly reﬂ ect the 

Control — Integrated Framework (1992)” issued by 

transactions and dispositions of Toyota’s assets;

the Committee of Sponsoring Organizations of the 

2)  provide reasonable assurance that transactions 

Treadway Commission.

are recorded as necessary to permit preparation 

  Based on this evaluation, management concluded 

of ﬁ nancial statements in accordance with U.S. 

that Toyota’s internal control over ﬁ nancial reporting 

GAAP, and that Toyota’s receipts and expenditures 

was effective as of March 31, 2013.

are being made only in accordance with 

  PricewaterhouseCoopers Aarata, an independent 

authorizations of Toyota’s management and 

registered public accounting ﬁ rm that audited the 

directors; and

consolidated ﬁ nancial statements included in this 

3)  provide reasonable assurance regarding 

report, has also audited the effectiveness of Toyota’s 

prevention or timely detection of unauthorized 

internal control over ﬁ nancial reporting as of March 

acquisition, use, or disposition of Toyota’s assets 

31, 2013, as stated in its report included herein.

that could have a material effect on the ﬁ nancial 

statements.

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Toyota Global Vision

President’s Message

Launching a New Structure

Special Feature

Consolidated Performance 
Highlights

Review of Operations

Management and 
Corporate Information

Financial Section

Investor Information

Prev

 Selected Financial Summary (U.S. GAAP)   
 Management’s Annual Report on Internal Control over Financial Reporting   

 Consolidated Segment Information   

 Consolidated Quarterly Financial Summary   
 Report of Independent Registered Public Accounting Firm

 Management’s Discussion and Analysis of Financial Condition and Results of Operations   

 Consolidated Financial Statements   

 Notes to Consolidated Financial Statements

Next

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors of Toyota Jidosha Kabushiki Kaisha 
(“Toyota Motor Corporation”)

In our opinion, the accompanying consolidated 

responsibility is to express opinions on these 

included performing such other procedures as we 

acquisition, use, or disposition of the company’s 

balance sheets and the related consolidated 

ﬁ nancial statements and on the Company's internal 

considered necessary in the circumstances. We 

assets that could have a material effect on the 

statements of income, comprehensive income, 

control over ﬁ nancial reporting based on our 

believe that our audits provide a reasonable basis 

ﬁ nancial statements.

shareholders’ equity and cash ﬂ ows present fairly, in 

integrated audits. We conducted our audits in 

for our opinions.

  Because of its inherent limitations, internal control 

all material respects, the ﬁ nancial position of Toyota 

accordance with the standards of the Public 

  A company’s internal control over ﬁ nancial 

over ﬁ nancial reporting may not prevent or detect 

Motor Corporation and its subsidiaries at March 31, 

Company Accounting Oversight Board (United 

reporting is a process designed to provide 

misstatements. Also, projections of any evaluation 

2012 and 2013, and the results of their operations 

States). Those standards require that we plan and 

reasonable assurance regarding the reliability of 

of effectiveness to future periods are subject to the 

and their cash ﬂ ows for each of the three years in 

perform the audits to obtain reasonable assurance 

ﬁ nancial reporting and the preparation of ﬁ nancial 

risk that controls may become inadequate because 

the period ended March 31, 2013 in conformity with 

about whether the ﬁ nancial statements are free of 

statements for external purposes in accordance 

of changes in conditions, or that the degree of 

accounting principles generally accepted in the 

material misstatement and whether effective internal 

with generally accepted accounting principles. A 

compliance with the policies or procedures may 

United States of America. Also in our opinion, the 

control over ﬁ nancial reporting was maintained in all 

company’s internal control over ﬁ nancial reporting 

deteriorate.

Company maintained, in all material respects, 

material respects. Our audits of the ﬁ nancial 

includes those policies and procedures that (i) 

effective internal control over ﬁ nancial reporting as 

statements included examining, on a test basis, 

pertain to the maintenance of records that, in 

of March 31, 2013, based on criteria established in 

evidence supporting the amounts and disclosures in 

reasonable detail, accurately and fairly reﬂ ect the 

Internal Control - Integrated Framework (1992) 

the ﬁ nancial statements, assessing the accounting 

transactions and dispositions of the assets of the 

issued by the Committee of Sponsoring 

principles used and signiﬁ cant estimates made by 

company; (ii) provide reasonable assurance that 

Organizations of the Treadway Commission 

management, and evaluating the overall ﬁ nancial 

transactions are recorded as necessary to permit 

(COSO). The Company's management is 

statement presentation. Our audit of internal control 

preparation of ﬁ nancial statements in accordance 

responsible for these ﬁ nancial statements, for 

over ﬁ nancial reporting included obtaining an 

with generally accepted accounting principles, and 

maintaining effective internal control over ﬁ nancial 

understanding of internal control over ﬁ nancial 

that receipts and expenditures of the company are 

reporting and for its assessment of the effectiveness 

reporting, assessing the risk that a material 

being made only in accordance with authorizations 

of internal control over ﬁ nancial reporting, included 

weakness exists, and testing and evaluating the 

of management and directors of the company; and 

in the accompanying Management's Annual Report 

design and operating effectiveness of internal 

(iii) provide reasonable assurance regarding 

on Internal Control Over Financial Reporting. Our 

control based on the assessed risk. Our audits also 

prevention or timely detection of unauthorized 

Nagoya, Japan

June 24, 2013

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Corporate Information

Financial Section

Investor Information

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Investor Information (As of March 31, 2013)

Corporate Data

Company Name:  Toyota Motor Corporation

Established:  

August 28, 1937

Common Stock:   ¥397,049 million

Fiscal Year-End:   March 31

Public Accounting Firm: 
PricewaterhouseCoopers Aarata

Number of Afﬁ liates:
[Consolidated Subsidiaries] 509
[Afﬁ liates Accounted for by the Equity Method] 56

Number of Employees: 
68,978 (Consolidated: 333,498)

Corporate Web Site:
[Corporate Information]
http://www.toyota-global.com
[IR Information]
http://www.toyota-global.com/investors

Stock Data

Number of Shares Authorized: 

10,000,000,000 shares

Number of Shares Issued:  

3,447,997,492 shares

Number of Treasury Stock:  

280,568,824 shares

Number of Shareholders:  

628,902

Number of Shares per Trading Unit:  

100 shares

Stock Listings:  

[Japan] Tokyo, Nagoya, Osaka, Fukuoka, Sapporo 
[Overseas] New York, London

Securities Code:  

[Japan] 7203

American Depositary Receipts (ADR):  

[Ratio] 1 ADR=2 common stocks [Symbol] TM

Transfer Agent in Japan: 

 Mitsubishi UFJ Trust and Banking Corporation
10-11, Higashisuna, 7-chome, Koutou-ku, Tokyo 137-8081, Japan
Japan Toll-Free: (0120)232-711

Depositary and Transfer Agent for ADR:   The Bank of New York Mellon

101 Barclay Street, New York, NY 10286, U.S.A.
Tel: (866)238-8978    U.S. Toll-Free: (888)269-2377, (888) BNY-ADRS
[Depositary Receipts] http://www.adrbnymellon.com
[Transfer Agent] http://www.bnymellon.com/shareowner

Contact Points for Investors

Japan  Toyota City Head Ofﬁ ce 

Tokyo Head Ofﬁ ce 

 1, Toyota-cho, Toyota City, Aichi Prefecture 471-8571, Japan
Tel: (0565)28-2121   Fax: (0565)23-5721

 4-18, Koraku 1-chome, Bunkyo-ku
Tokyo 112-8701, Japan
Tel: (03)3817-7111   Fax: (03)3817-9092

U.S.A. 

 Toyota Motor North America, Inc. 

 601 Lexington Avenue, 49th Floor, New York, NY 10022, U.S.A.
Tel: (212)223-0303   Fax: (212)759-7670

U.K. 

Toyota Motor Europe NV/SA 

 Curzon Square, 25 Park Lane, London W1K 1RA, U.K.
Tel: (207)290-8513   Fax: (207)290-8502

Major Shareholders (Top 10)

Ownership Breakdown

Name

Japan Trustee Services Bank, Ltd.

Toyota Industries Corporation

The Master Trust Bank of Japan, Ltd.

State Street Bank and Trust Company

Nippon Life Insurance Company

The Bank of New York Mellon as Depositary 
Bank for Depositary Receipt Holders

Trust & Custody Services Bank, Ltd.

Mitsui Sumitomo Insurance Company, Limited

SSBT OD05 OMNIBUS 
ACCOUNT-TREATY CLIENTS

DENSO CORPORATION

Number of Shares 
Held (Thousands)

328,913

218,515

185,036

132,366

129,455

82,399

75,309

66,063

61,752

58,903

Other 
corporate 
entities
17.61%

Financial 
institutions, 
Brokerages
30.89%

Individuals, 
etc.
21.58%

Foreign corporate 
entities and others
29.92%

Toyota’s Stock Price and Trading Volume on the Tokyo Stock Exchange

Note: Individuals, etc, include shares of 280 million treasury stock.

Stock price(¥)

6,000

4,000

2,000

0

Trading volume
 (Million shares)

600

400

200

0

FY2009
5,710
2,585

3,120

High (¥)

Low (¥)

At 
Year-End 
(¥)

FY2010
4,235
3,140

3,745

FY2011
3,955
2,800

3,350

FY2012
3,635
2,330

3,570

FY2013
5,050
2,795

4,860