Toyota Motor Corp.’s stock price fell as much as 5.3% in New York trading as the world's second-largest automaker posted a steeper drop in quarterly profit than analysts estimated and said earnings this year will slump 27% on a stronger yen and decreasing U.S. sales, Bloomberg News reported.

Net income declined 28% to 316.8 billion yen ($3 billion) in the fiscal fourth quarter ended March from 440 billion yen a year earlier, Toyota said in a statement Thursday.

Toyota, Honda Motor Co. and Mazda Motor Corp. all predict lower profit this year as the yen's 15% gain against the dollar in the past 12 months erodes the value of sales in North America, Bloomberg said.

“The slowdown in the U.S. really hit Toyota,” said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments Ltd. in Tokyo, which oversees $28 billion in assets, Bloomberg said. “The market has yet to hit bottom.”

Toyota, vying with General Motors Corp. to be the world's largest carmaker, boosted U.S. retail sales in April for the first time in five months on demand for the Yaris and the Prius.

U.S. drivers are picking fuel-efficient Toyota models over GM and Ford Motor Co. pick-ups because of record fuel prices, Bloomberg said.

“I expect more bad news from the industry,” said Edwin Merner, president of Tokyo-based Atlantis Investment Research Corp., which manages $2 billion in assets. Still, “Toyota should come through this period stronger and better” because of its lead in gasoline-electric hybrid technology.
The carmaker forecasts its North American sales will drop to 2.77 million vehicles this fiscal year from 2.96 million last year. Global sales will rise about 1.7% to 9.06 million vehicles for the period. Sales in China will rise 36% to 640,000 vehicles this fiscal year.

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