Toyota shares soar again after shareholders back board and chair in long-awaited vote
Toyota’s chair and former president Akio Toyoda survived a shareholder challenge on governance and climate policy today, prompting a second day of soaring shares for the automaker.
Toyota’s shares settled up 6.3 per cent on Wednesday, following a similar five per cent rise the day before, which was prompted by the unveiling of a new EV strategy and technologies, intended to help the company regain lost ground in the transition to greener vehicles.
The outcome of the vote follows months of turbulence for the company ahead of its annual meeting, which had seen US proxy advisers Glass Lewis urge shareholders to vote against Toyoda, claiming he “should be held accountable for allowing insufficient independent representation.”
Concerns were also raised by European pension funds and asset managers, who sought greater transparency over the firms’ climate lobbying and environmental position.
Toyota has faced strong criticism from activists and investors under Toyoda, for falling behind in the race to transition to EVs, but new president Koji Sato has vowed to prioritise the company’s electric push.
Yesterday’s EV tech announcement was the clearest demonstration of the company’s new approach, as Toyota unveiled a range of new battery-related technologies that would increase the range of its vehicles.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said “Toyota’s share price had already been reinvigorated by the pledge to push harder into the electric vehicle market and it’s been turbo charged by this renewed commitment to speed up the shift in business from the CEO.”
However, Streeter highlighted that forecasts for the year remained “conservative”.
She told Morning Wire to not “expect this announcement to translate into a significant boost for profits in the immediate term, as forecasts for the year remain conservative. But by putting its foot on the accelerator and aiming to take a bigger slide of the battery market, there appears to be renewed confidence that Toyota won’t be left behind.
“The rejection of the climate resolution was largely expected given the majority of investors are highly supportive, but the very fact it was tabled in the first place shows how ESG issues are being pushed further into the limelight by institutional investors and can’t easily be ignored.”
Soumen Mendel, senior analyst at the Hong Kong-based market research firm Counterpoint, said that Toyota’s “aggressive EV plans include introducing 10 new EV models by 2026 and targeting the sale of 3.5 million BEVs by 2030”.
“This shift in strategy and the clear focus on EVs instills confidence in investors, as Toyota, known as one of the world’s leading car manufacturers, possesses the necessary capabilities and resources to make electrification a success.”