As filed with the Securities and Exchange Commission on June 24, 2015

UNITED STATESSECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 20-F(Mark One)‘REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT
OF 1934È

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934‘

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934‘

SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934

OR
For the fiscal year ended: March 31, 2015
OR
OR

Commission file number: 001-14948

TOYOTA (ExactJIDOSHA
KABUSHIKI KAISHAName of Registrant as Specified in its Charter)
TOYOTA
MOTOR CORPORATION(Translation of Registrant’s Name into English)
Japan(Jurisdiction of Incorporation or Organization)

1 Toyota-cho, Toyota City
Aichi Prefecture 471-8571
Japan+81 565 28-2121(Address of Principal Executive Offices)
Hiroaki Shimizu
Telephone number: +81 565 28-2121
Facsimile number: +81 565 23-5800
Address: 1 Toyota-cho, Toyota City, Aichi Prefecture 471-8571, Japan(Name, telephone, e-mail and/or facsimile number and address of registrant’s contact person)
Securities registered or to be registered pursuant to Section 12(b) of the Act:
Title of Each Class:Name of Each Exchange on Which Registered:
American Depositary Shares*
The New York Stock Exchange
Common Stock*** American Depositary Receipts evidence American Depositary Shares, each American Depositary Share representing two shares of the registrant’s Common Stock.
** No par value. Not for trading, but only in connection with the registration of American Depositary Shares, pursuant to the requirements of the U.S. Securities andExchange Commission.

Securities registered or to be registered pursuant to Section 12(g) of the Act:
None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:
None
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by theannual report: 3,146,813,631 Shares of Common Stock (including 82,545,759 Shares of Common Stock in the form of American Depositary Shares)
as of March 31, 2015
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act:Yes È No ‘
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934:
Yes ‘ No È
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days:Yes È No ‘
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data Filerequired to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter
period that the registrant was required to submit and post such files):Yes È No ‘
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated
filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer È
Accelerated filer ‘
Non-accelerated filer ‘
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
U.S. GAAP È
International Financial Reporting Standards as issued by the International Accounting Standards Board ‘
Other ‘If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected tofollow:
Item 17 ‘ Item 18 ‘
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the ExchangeAct):Yes ‘ No ÈTABLE OF CONTENTSITEM 1.

IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS . . . . . . . . . .

1

ITEM 2.

OFFER STATISTICS AND EXPECTED TIMETABLE . . . . . . . . . . . . . . . . . . . . . . . . . . .

1

ITEM 3.

KEY INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1

3.A
3.B
3.C
3.D

SELECTED FINANCIAL DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
CAPITALIZATION AND INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
REASONS FOR THE OFFER AND USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . .
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1
4
4
5

ITEM 4.

INFORMATION ON THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8

4.A
4.B
4.C
4.D

HISTORY AND DEVELOPMENT OF THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . .
BUSINESS OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ORGANIZATIONAL STRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PROPERTY, PLANTS AND EQUIPMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8
9
51
52

ITEM 4A.

UNRESOLVED STAFF COMMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

53

ITEM 5.

OPERATING AND FINANCIAL REVIEW AND PROSPECTS . . . . . . . . . . . . . . . . . . . .

53

5.A
5.B
5.C
5.D
5.E
5.F
5.G

OPERATING RESULTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
LIQUIDITY AND CAPITAL RESOURCES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES . . . . . . . . . . . . . . . . .
TREND INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
OFF-BALANCE SHEET ARRANGEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS . . . . . . . . . . . . . . . . .
SAFE HARBOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

53
84
87
89
89
90
91

ITEM 6.

DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES . . . . . . . . . . . . . . . . . . . .

91

6.A
6.B
6.C
6.D
6.E

DIRECTORS AND SENIOR MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
COMPENSATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
BOARD PRACTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EMPLOYEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SHARE OWNERSHIP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

91
99
100
101
102

ITEM 7.

MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS . . . . . . . . . . . .

103

7.A
7.B
7.C

MAJOR SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
RELATED PARTY TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
INTERESTS OF EXPERTS AND COUNSEL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

103
104
104

ITEM 8.

FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

104

8.A
8.B

CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION . . . . .
SIGNIFICANT CHANGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

104
105

ITEM 9.

THE OFFER AND LISTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

105

9.A
9.B
9.C
9.D
9.E
9.F

LISTING DETAILS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
MARKETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SELLING SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
DILUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EXPENSES OF THE ISSUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

105
105
106
106
106
106

ITEM 10.

ADDITIONAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

106

10.A
10.B
10.C
10.D

SHARE CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
MEMORANDUM AND ARTICLES OF ASSOCIATION . . . . . . . . . . . . . . . . . . . . . . . . .
MATERIAL CONTRACTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EXCHANGE CONTROLS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

106
106
114
114

10.E
10.F
10.G
10.H
10.I

TAXATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
DIVIDENDS AND PAYING AGENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
STATEMENT BY EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
DOCUMENTS ON DISPLAY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SUBSIDIARY INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

115
121
121
121
121

ITEM 11.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK . . .

122

ITEM 12.

DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES . . . . . . . . . . .

123

12.A
12.B
12.C
12.D

DEBT SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
WARRANTS AND RIGHTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
OTHER SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
AMERICAN DEPOSITARY SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

123
123
123
124

ITEM 13.

DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES . . . . . . . . . . . . . . . .

125

ITEM 14.

MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

125

ITEM 15.

CONTROLS AND PROCEDURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

125

ITEM 16.

[RESERVED] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

126

16A.

AUDIT COMMITTEE FINANCIAL EXPERT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

126

16B.

CODE OF ETHICS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

126

16C.

PRINCIPAL ACCOUNTANT FEES AND SERVICES . . . . . . . . . . . . . . . . . . . . . . . . . . .

127

16D.

EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES . . .

128

16E.

PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED
PURCHASERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

128

16F.

CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT . . . . . . . . . . . . . . . . . . .

129

16G.

CORPORATE GOVERNANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

129

16H.

MINE SAFETY DISCLOSURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

132

ITEM 17.

FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

133

ITEM 18.

FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

133

ITEM 19.

EXHIBITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

134

As used in this annual report, the term “fiscal” preceding a year means the twelve-month period ended
March 31 of the year referred to. All other references to years refer to the applicable calendar year, unless thecontext otherwise requires. As used herein, the term “Toyota” refers to Toyota Motor Corporation and its
consolidated subsidiaries as a group, unless the context otherwise indicates.
In parts of this annual report, amounts reported in Japanese yen have been translated into U.S. dollars for theconvenience of readers. Unless otherwise noted, the rate used for this translation was ¥120.17 = $1.00. This was
the approximate exchange rate in Japan on March 31, 2015.
CAUTIONARY STATEMENT WITH RESPECT TO FORWARD-LOOKING STATEMENTS
Written forward-looking statements may appear in documents filed with the Securities and Exchange
Commission, or the SEC, including this annual report, documents incorporated by reference, reports toshareholders and other communications.
The U.S. Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking
information to encourage companies to provide prospective information about themselves without fear of
litigation so long as the information is identified as forward looking and is accompanied by meaningful
cautionary statements identifying important factors that could cause actual results to differ materially from thoseprojected in the information. Toyota relies on this safe harbor in making forward-looking statements.
Forward-looking statements appear in a number of places in this annual report and include statements
regarding Toyota’s current intent, belief, targets or expectations or those of its management. In many, but not allcases, words such as “aim”, “anticipate”, “believe”, “estimate”, “expect”, “hope”, “intend”, “may”, “plan”,“predict”, “probability”, “risk”, “should”, “will”, “would”, and similar expressions, are used as they relate to
Toyota or its management, to identify forward-looking statements. These statements reflect Toyota’s current
views with respect to future events and are subject to risks, uncertainties and assumptions. Should one or more ofthese risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may varymaterially from those which are anticipated, aimed at, believed, estimated, expected, intended or planned.
Forward-looking statements are not guarantees of future performance and involve risks and uncertainties.
Actual results may differ from those in forward-looking statements as a result of various factors. Importantfactors that could cause actual results to differ materially from estimates or forecasts contained in theforward-looking statements are identified in “Risk Factors” and elsewhere in this annual report, and include,
among others:(i) changes in economic conditions, market demand, and the competitive environment affecting theautomotive markets in Japan, North America, Europe, Asia and other markets in which Toyota operates;(ii) fluctuations 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 fluctuations;(iii) changes in funding environment in financial markets and increased competition in the financial
services industry;(iv) Toyota’s ability to market and distribute effectively;(v) Toyota’s ability to realize production efficiencies and to implement capital expenditures at thelevels 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 economy, 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 products that meetcustomer 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 difficulties 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 areproduced, distributed or sold; and(xiv) the impact of natural calamities including the negative effect on Toyota’s vehicle production andsales.

PART IITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
Not applicable.
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
Not applicable.
ITEM 3. KEY INFORMATION
3.A SELECTED FINANCIAL DATA
You should read the U.S. GAAP selected consolidated financial information presented below together with“Operating and Financial Review and Prospects” and Toyota’s consolidated financial statements contained in thisannual report.
U.S. GAAP Selected Financial Data
The following selected financial data have been derived from Toyota’s consolidated financial statements.
These financial statements were prepared in accordance with U.S. GAAP.
2011

Consolidated Statement of Income Data:
Automotive:
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Services:
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . .
All Other:
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . .
Elimination of intersegment:
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . .
Total Company:
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . .
Income before income taxes and equity in earnings
of affiliated companies . . . . . . . . . . . . . . . . . . . .
Net income attributable to Toyota Motor
Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income attributable to Toyota Motor Corporation
per share (yen):
Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Shares used in computing net income attributable to
Toyota Motor Corporation per share, basic(in thousands) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Shares used in computing net income attributable to
Toyota Motor Corporation per share, diluted(in thousands) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Year Ended March 31,
2012
2013
2014
(Yen in millions, except share and per share data)

2015

17,337,320
85,973

16,994,546
21,683

20,419,100
944,704

23,781,404
1,938,778

25,062,129
2,325,310

1,192,205
358,280

1,100,324
306,438

1,170,670
315,820

1,421,047
294,891

1,661,149
361,833

972,252
35,242

1,048,915
42,062

1,066,461
53,616

1,151,280
64,2701,255,791
65,650(508,089)(11,216)(560,132)(14,556)(592,039)
6,748(661,820)(5,827)(744,548)(2,229)18,993,688
468,279

18,583,653
355,627

22,064,192
1,320,888

25,691,911
2,292,112

27,234,521
2,750,564

563,290432,873

1,403,649

2,441,080

2,892,828

408,183

283,559

962,163

1,823,119

2,173,338

130.17130.16

90.21
90.20

303.82303.78575.30574.92688.02687.663,135,881

3,143,470

3,166,909

3,168,989

3,158,851

3,135,915

3,143,470

3,167,155

3,170,911

3,160,429

1

Year Ended March 31,
2011
2012
2013
2014
2015
(Yen in millions, except per share and numbers of vehicles sold data)

Consolidated Balance Sheet Data (end of period):
Total Assets: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Short-term debt, including current portion of long-term
debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term debt, less current portion . . . . . . . . . . . . . . . .
Toyota Motor Corporation shareholders’ equity . . . . . . .
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other Data:
Dividends per share (yen) . . . . . . . . . . . . . . . . . . . . . . . .
Number of vehicles soldJapan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Worldwide total . . . . . . . . . . . . . . . . . . . . . . . .

29,818,166

30,650,965

35,483,317

41,437,473

47,729,830

5,951,836
6,449,220
10,332,371
397,050

5,963,269
6,042,277
10,550,261
397,050

6,793,956
7,337,824
12,148,035
397,050

7,780,483
8,546,910
14,469,148
397,050

8,963,492
10,014,395
16,788,131
397,050

50.0

50.0

90.0

165.0

200.0

1,913,117
2,031,249
795,534
1,255,016
1,313,123

2,070,799
1,872,423
797,993
1,326,829
1,283,885

2,278,796
2,468,804
799,085
1,683,578
1,640,401

2,365,410
2,529,398
844,003
1,608,355
1,768,867

2,153,694
2,715,173
859,038
1,488,922
1,755,037

7,308,039

7,351,929

8,870,664

9,116,033

8,971,864* “Other” consists of Central and South America, Oceania, Africa and the Middle East, etc.

Dividend Information
Toyota normally pays dividends twice per year, including an interim dividend and a year-end dividend.
Although Toyota’s articles of incorporation provide that retained earnings can be distributed as dividends
pursuant to the resolution of its board of directors, Toyota’s board of directors recommends the payment of ayear-end dividend to holders of common shares and registered pledgees of common shares of record as ofMarch 31, the record date, in each year. Year-end dividends are usually paid to shareholders immediately
following approval of the dividend at the general shareholders’ meeting, normally around the middle of June ofeach year.
At the 111th Ordinary General Shareholders’ Meeting held in June 2015, Toyota’s shareholders approved
amendments to Toyota’s articles of incorporation permitting the issuance of Model AA Class Shares in the
future. The articles of incorporation now provide that in the event that Toyota pays a year-end dividend toholders of common shares, it will pay a year-end dividend to any holders of Model AA Class Shares or registeredpledgees of Model AA Class Shares of record as of the record date for the year-end dividend, in the amountpayable on the Model AA Class Shares pursuant to their terms (“AA Dividends”), in preference to holders ofcommon shares or registered pledgees of common shares.
In addition to these year-end dividends, Toyota may pay an interim dividend in the form of cash
distributions from its distributable surplus to holders of common shares and pledgees of common shares of record
as of September 30, the record date, in each year by resolution of its board of directors. Toyota normally pays theinterim dividend in late November. The articles of incorporation now provide that in the event that Toyota pays
such interim dividends, Toyota will pay an amount equivalent to one-half of the AA Dividends (“AA Interim
Dividends”) as an interim dividend to any holders of Model AA Class Shares or registered pledgees of ModelAA Class Shares of record as of the record date for the interim dividend, in preference to holders of commonshares or registered pledgees of common shares.
If the amount of the dividends from surplus paid to holders of Model AA Class Shares or registeredpledgees of Model AA Class Shares is less than the prescribed amount of AA Dividends in any fiscal year, theamount of the shortfall will be carried forward to and accumulate in the following fiscal year and thereafter.
Dividends from surplus will be paid to holders of Model AA Class Shares or registered pledgees of ModelAA Class Shares in preference to the payment of interim and year-end dividends until such payment reaches theamount of the accumulated unpaid dividends on the Model AA Class Shares.
2For a further discussion of Model AA Class Shares, please see “Additional Information — Memorandum
and Articles of Association.”
In addition, under the Companies Act of Japan (the “Companies Act”), dividends may be paid to holders ofcommon shares and pledgees of record of common shares as of any record date, other than those specified above,
as set forth in Toyota’s articles of incorporation or as determined by its board of directors from time to time.
Toyota’s articles of incorporation permit Toyota to pay dividends, in addition to interim dividends mentioned in
the preceding paragraph, by a resolution of its board of directors. Toyota has incorporated such a provision into
its articles of incorporation in order to enable a flexible capital policy. Under the Companies Act, dividends may
be distributed in cash or (except in the case of interim dividends mentioned in the third preceding paragraph) in
kind, subject to limitations on distributable surplus and to certain other conditions.
The following table sets forth the dividends declared by Toyota for each of the periods shown. The periods
shown are the six months ended on that date. The U.S. dollar equivalents for the cash dividends shown are basedon the noon buying rate for Japanese yen on the last date of each period set forth below.
Cash Dividends per Common
Share
Yen
U.S. dollars

Period Ended

September 30, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

20.0
30.0
20.0
30.0
30.0
60.0
65.0
100.0
75.0
125.0

0.24
0.36
0.25
0.36
0.38
0.63
0.66
0.97
0.68
1.04

The payment and the amount of any future dividends are dependent on the amount of Toyota’s future
earnings, its financial condition and other factors, including statutory restrictions on the payment of dividends.
Toyota deems the benefit of its shareholders as one of its priority management policies, and it continues towork to improve its corporate structure to realize sustainable growth in order to enhance its corporate value.
Toyota will strive to continue to pay stable dividends aiming at a consolidated dividend payout ratio of 30%
while giving due consideration to factors such as business results for each term, investment plans and its cash
reserves. In order to successfully compete in this highly competitive industry, Toyota plans to utilize its internalfunds for the early commercialization of next-generation environment and safety technologies, giving priority tocustomer safety and reliability. Considering these factors, an annual dividend of ¥200 per common share waspaid for fiscal 2015, consisting of a year-end dividend of ¥125 per common share and an interim dividend of¥75 per common share.
In fiscal 2015, Toyota repurchased 55,521,900 shares of its common stock at a total cost of ¥359.9 billion,
excluding shares constituting less than one unit that were purchased by Toyota upon request. Since Toyota began
repurchasing common shares in fiscal 1997, the cumulative number of common shares repurchased as of the endof March 2015 was 792.5 million shares at a total cost of ¥3,228.7 billion. The following table shows theapproximate number of common shares repurchased and the approximate cost of repurchase of those shares foreach of the periods indicated:

Number of shares repurchased . . . . . .
Amount paid . . . . . . . . . . . . . . . . . . . .

2011

2012

Year Ended March 31,
2013

2014

2015

0
0

0
0

0
0

0
0

55,521,900
359,9943

Toyota’s future share repurchases will be influenced by factors such as Toyota’s future earnings andfinancial position. For a further discussion of Toyota’s share repurchases, please see “Purchases of Equity
Securities by the Issuer and Affiliated Purchasers”.
Exchange Rates
In parts of this annual report, yen amounts have been translated into U.S. dollars for the convenience ofinvestors. Unless otherwise noted, the rate used for the translations was ¥120.17 = $1.00. This was theapproximate exchange rate in Japan on March 31, 2015.
The following table sets forth information regarding the noon buying rates for Japanese yen in New York
City as announced for customs purposes by the Federal Reserve Bank of New York expressed in Japanese yen
per $1.00 during the periods shown. At the end of May 2015, the noon buying rate was ¥123.98 = $1.00. The
average exchange rate for the periods shown is the average of the month-end rates during the period.
Fiscal Year Ended or Ending March 31,

2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2016 (through May 31, 2015) . . . . . . . . . . . . . . . . . . .

At End of Period

Average(of month-end rates)(¥ per $1.00)

High

Low

82.76
82.41
94.16
102.98119.96123.98

85.00
78.86
83.26
100.46110.78121.92

94.68
85.26
96.16
105.25
121.50124.18

78.74
75.72
77.41
92.96
101.26118.80Month Ended

High
Low
(¥ per $1.00)

December 31, 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
January 31, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
February 28, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
April 30, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
May 31, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

121.38120.20120.38121.50120.36124.18117.28116.78117.33119.01118.80119.09Fluctuations in the exchange rate between the Japanese yen and the U.S. dollar will affect the dollar
equivalent of the price of the shares on the Japanese stock exchanges. As a result, exchange rate fluctuations arelikely to affect the market price of the American Depositary Shares (“ADSs”) on the New York Stock Exchange(“NYSE”). Toyota will declare any cash dividends on shares in Japanese yen. Exchange rate fluctuations will
also affect the U.S. dollar amounts received on conversion of cash dividends.
Exchange rate fluctuations can also materially affect Toyota’s reported operating results. In particular, astrengthening of the Japanese yen against the U.S. dollar can have a material adverse effect on Toyota’s reported
operating results. For a further discussion of the effects of currency rate fluctuations on Toyota’s operating
results, please see “Operating and Financial Review and Prospects — Operating Results — Overview —Currency Fluctuations”.
3.B CAPITALIZATION AND INDEBTEDNESS
Not applicable.
3.C REASONS FOR THE OFFER AND USE OF PROCEEDS
Not applicable.
43.D RISK FACTORS
Industry and Business Risks
The worldwide automotive market is highly competitive.
The worldwide automotive market is highly competitive. Toyota faces intense competition from automotive
manufacturers in the markets in which it operates. Although the global economy continues to recover gradually,
competition in the automotive industry has further intensified amidst difficult overall market conditions. In addition,competition is likely to further intensify in light of further continuing globalization in the worldwide automotive
industry, possibly resulting in industry reorganizations. Factors affecting competition include product quality andfeatures, safety, reliability, fuel economy, the amount of time required for innovation and development, pricing,customer service and financing terms. Increased competition may lead to lower vehicle unit sales, which may resultin a further downward price pressure and adversely affect Toyota’s financial condition and results of operations.
Toyota’s ability to adequately respond to the recent rapid changes in the automotive market and to maintain its
competitiveness will be fundamental to its future success in existing and new markets and to maintain its market
share. There can be no assurances that Toyota will be able to compete successfully in the future.
The worldwide automotive industry is highly volatile.
Each of the markets in which Toyota competes has been subject to considerable volatility in demand.
Demand for vehicles depends to a large extent on economic, social and political conditions in a given market andthe introduction of new vehicles and technologies. As Toyota’s revenues are derived from sales in markets
worldwide, economic conditions in such markets are particularly important to Toyota. In fiscal 2015, theJapanese economy continued on a path of moderate recovery, even though weakness could be seen in personal
consumption and other areas. The U.S. economy saw ongoing recovery mainly due to increasing personal
consumption and the European economy as a whole showed continuing signs of recovery. Meanwhile,
economies such as those of China and emerging countries showed signs of weakness. The shifts in demand forautomobiles are continuing, and it is unclear how this situation will transition in the future. Toyota’s financial
condition and results of operations may be adversely affected if the shifts in demand for automobiles continues orprogresses further. Demand may also be affected by factors directly impacting vehicle price or the cost ofpurchasing and operating vehicles such as sales and financing incentives, prices of raw materials and parts andcomponents, cost of fuel and governmental regulations (including tariffs, import regulation and other taxes).
Volatility in demand may lead to lower vehicle unit sales, which may result in downward price pressure andadversely affect Toyota’s financial condition and results of operations.
Toyota’s future success depends on its ability to offer new, innovative and competitively priced products thatmeet customer demand on a timely basis.
Meeting customer demand by introducing attractive new vehicles and reducing the amount of time requiredfor product development are critical to automotive manufacturers. In particular, it is critical to meet customer
demand with respect to quality, safety and reliability. The timely introduction of new vehicle models, atcompetitive prices, meeting rapidly changing customer preferences and demand is more fundamental to Toyota’s
success than ever, as the automotive market is rapidly transforming in light of the changing global economy.
There is no assurance, however, that Toyota will adequately and appropriately respond to changing customer
preferences and demand with respect to quality, safety, reliability, styling and other features in a timely manner.
Even if Toyota succeeds in perceiving customer preferences and demand, there is no assurance that Toyota will
be capable of developing and manufacturing new, price competitive products in a timely manner with its
available technology, intellectual property, sources of raw materials and parts and components, and production
capacity, including cost reduction capacity. Further, there is no assurance that Toyota will be able to implement
capital expenditures at the level and times planned by management. Toyota’s inability to develop and offer
products that meet customers’ preferences and demand with respect to quality, safety, reliability, styling andother features in a timely manner could result in a lower market share and reduced sales volumes and margins,and may adversely affect Toyota’s financial condition and results of operations.
5Toyota’s ability to market and distribute effectively is an integral part of Toyota’s successful sales.
Toyota’s success in the sale of vehicles depends on its ability to market and distribute effectively based on
distribution networks and sales techniques tailored to the needs of its customers. There is no assurance that
Toyota will be able to develop sales techniques and distribution networks that effectively adapt to changing
customer preferences or changes in the regulatory environment in the major markets in which it operates.
Toyota’s inability to maintain well-developed sales techniques and distribution networks may result in decreased
sales and market share and may adversely affect its financial condition and results of operations.
Toyota’s success is significantly impacted by its ability to maintain and develop its brand image.
In the highly competitive automotive industry, it is critical to maintain and develop a brand image. In orderto maintain and develop a brand image, it is necessary to further increase customers’ confidence by providing
safe, high-quality products that meet customer preferences and demand. If Toyota is unable to effectively
maintain and develop its brand image as a result of its inability to provide safe, high-quality products or as aresult of the failure to promptly implement safety measures such as recalls when necessary, vehicle unit sales
and/or sale prices may decrease, and as a result revenues and profits may not increase as expected or may
decrease, adversely affecting its financial condition and results of operations.
Toyota relies on suppliers for the provision of certain supplies including parts, components and raw materials.
Toyota purchases supplies including parts, components and raw materials from a number of external
suppliers located around the world. For some supplies, Toyota relies on a single supplier or a limited number ofsuppliers, whose replacement with another supplier may be difficult. Inability to obtain supplies from a single orlimited source supplier may result in difficulty obtaining supplies and may restrict Toyota’s ability to produce
vehicles. Furthermore, even if Toyota were to rely on a large number of suppliers, first-tier suppliers with whom
Toyota directly transacts may in turn rely on a single second-tier supplier or limited second-tier suppliers.
Toyota’s ability to continue to obtain supplies from its suppliers in a timely and cost-effective manner is subject
to a number of factors, some of which are not within Toyota’s control. These factors include the ability of
Toyota’s suppliers to provide a continued source of supply, and Toyota’s ability to effectively compete andobtain competitive prices from suppliers. A loss of any single or limited source supplier or inability to obtainsupplies from suppliers in a timely and cost-effective manner could lead to increased costs or delays orsuspensions in Toyota’s production and deliveries, which could have an adverse effect on Toyota’s financial
condition and results of operations.
The worldwide financial services industry is highly competitive.
The worldwide financial services industry is highly competitive. Increased competition in automobile
financing may lead to decreased margins. A decline in Toyota’s vehicle unit sales, an increase in residual value
risk due to lower used vehicle price, an increase in the ratio of credit losses and increased funding costs arefactors which may impact Toyota’s financial services operations. If Toyota is unable to adequately respond to thechanges and competition in automobile financing, Toyota’s financial services operations may adversely affect its
financial condition and results of operations.
Toyota’s operations and vehicles rely on various digital and information technologies.
Toyota depends on various information technology networks and systems, some of which are managed bythird parties, to process, transmit and store electronic information, including sensitive data, and to manage or
support a variety of business processes and activities, including manufacturing, research and development,
supply chain management, sales and accounting. In addition, Toyota’s vehicles may rely on various digital andinformation technologies, including information service and driving assistance functions. Despite security
measures, Toyota’s digital and information technology networks and systems may be vulnerable to damage,disruptions or shutdowns due to attacks by hackers, computer viruses, breaches due to unauthorized use, errors or6

malfeasance by employees and others who have or gain access to the networks and systems Toyota depends on,service failures or bankruptcy of third parties such as software development or cloud computing vendors, power
shortages and outages, and utility failures or other catastrophic events like natural disasters. Such incidents could
materially disrupt critical operations, disclose sensitive data, interfere with information services and driving
assistance functions in Toyota’s vehicles, and/or give rise to legal claims or proceedings, liability or regulatory
penalties under applicable laws, which could have an adverse effect on Toyota’s brand image and its financial
condition and results of operations.
Financial Market and Economic Risks
Toyota’s operations are subject to currency and interest rate fluctuations.
Toyota is sensitive to fluctuations in foreign currency exchange rates and is principally exposed tofluctuations in the value of the Japanese yen, the U.S. dollar and the euro and, to a lesser extent, the Australian
dollar, the Russian ruble, the Canadian dollar and the British pound. Toyota’s consolidated financial statements,
which are presented in Japanese yen, are affected by foreign currency exchange fluctuations through translation
risk, and changes in foreign currency exchange rates may also affect the price of products sold and materials
purchased by Toyota in foreign currencies through transaction risk. In particular, strengthening of the Japanese
yen against the U.S. dollar can have an adverse effect on Toyota’s operating results.
Toyota believes that its use of certain derivative financial instruments including foreign exchange forward
contracts and interest rate swaps and increased localized production of its products have reduced, but noteliminated, the effects of interest rate and foreign currency exchange rate fluctuations. Nonetheless, a negative
impact resulting from fluctuations in foreign currency exchange rates and changes in interest rates may adversely
affect Toyota’s financial condition and results of operations. For a further discussion of currency and interest rate
fluctuations and the use of derivative financial instruments, see “Operating and Financial Review and Prospects— Operating Results — Overview — Currency Fluctuations”, “Quantitative and Qualitative Disclosures About
Market Risk”, and notes 20 and 21 to Toyota’s consolidated financial statements.
High prices of raw materials and strong pressure on Toyota’s suppliers could negatively impact Toyota’s
profitability.
Increases in prices for raw materials that Toyota and Toyota’s suppliers use in manufacturing their products
or parts and components such as steel, precious metals, non-ferrous alloys including aluminum, and plastic parts,
may lead to higher production costs for parts and components. This could, in turn, negatively impact Toyota’s
future profitability because Toyota may not be able to pass all those costs on to its customers or require its
suppliers to absorb such costs.
A downturn in the financial markets could adversely affect Toyota’s ability to raise capital.
Should the world economy suddenly deteriorate, a number of financial institutions and investors will facedifficulties in providing capital to the financial markets at levels corresponding to their own financial capacity,
and, as a result, there is a risk that companies may not be able to raise capital under terms that they would expect
to receive with their creditworthiness. If Toyota is unable to raise the necessary capital under appropriate
conditions on a timely basis, Toyota’s financial condition and results of operations may be adversely affected.
Political, Regulatory, Legal and Other Risks
The automotive industry is subject to various governmental regulations.
The worldwide automotive industry is subject to various laws and governmental regulations including thoserelated to vehicle safety and environmental matters such as emission levels, fuel economy, noise and pollution. In
particular, automotive manufacturers such as Toyota are required to implement safety measures such as recalls
7

for vehicles that do not or may not comply with the safety standards of laws and governmental regulations. In
addition, Toyota may, in order to reassure its customers of the safety of Toyota’s vehicles, decide to voluntarily
implement recalls or other safety measures even if the vehicle complies with the safety standards of relevant laws
and governmental regulations. Many governments also impose tariffs and other trade barriers, taxes and levies, orenact price or exchange controls. Toyota has incurred, and expects to incur in the future, significant costs incomplying with these regulations. If Toyota launches products that result in safety measures such as recalls,
Toyota may incur various costs including significant costs for free repairs. Furthermore, new legislation orchanges in existing legislation may also subject Toyota to additional expenses in the future. If Toyota incurs
significant costs related to implementing safety measures or meeting laws and governmental regulations,Toyota’s financial condition and results of operations may be adversely affected.
Toyota may become subject to various legal proceedings.
As an automotive manufacturer, Toyota may become subject to legal proceedings in respect of various
issues, including product liability and infringement of intellectual property. Toyota may also be subject to legal
proceedings brought by its shareholders and governmental proceedings and investigations. Toyota is in factcurrently subject to a number of pending legal proceedings and government investigations. A negative
outcome in one or more of these pending legal proceedings could adversely affect Toyota’s financial condition
and results of operations. For a further discussion of governmental regulations, see “Information on the
Company — Business Overview — Governmental Regulation, Environmental and Safety Standards” and forlegal proceedings, please see “Information on the Company — Business Overview — Legal Proceedings”.
Toyota may be adversely affected by natural calamities, political and economic instability, fuel shortages orinterruptions in social infrastructure, wars, terrorism and labor strikes.
Toyota is subject to various risks associated with conducting business worldwide. These risks include
natural calamities; political and economic instability; fuel shortages; interruption in social infrastructure
including energy supply, transportation systems, gas, water, or communication systems resulting from natural
hazards or technological hazards; wars; terrorism; labor strikes and work stoppages. Should the major markets inwhich Toyota purchases materials, parts and components and supplies for the manufacture of Toyota products orin which Toyota’s products are produced, distributed or sold be affected by any of these events, it may result in
disruptions and delays in the operations of Toyota’s business. Should significant or prolonged disruptions ordelays related to Toyota’s business operations occur, it may adversely affect Toyota’s financial condition andresults of operations.
ITEM 4. INFORMATION ON THE COMPANY
4.A HISTORY AND DEVELOPMENT OF THE COMPANY
Toyota Motor Corporation is a limited liability, joint-stock company incorporated under the Commercial
Code of Japan and continues to exist under the Companies Act. Toyota commenced operations in 1933 as theautomobile division of Toyota Industries Corporation (formerly, Toyoda Automatic Loom Works, Ltd.). Toyota
became a separate company on August 28, 1937. In 1982, the Toyota Motor Company and Toyota Motor Sales
merged into one company, the Toyota Motor Corporation of today. As of March 31, 2015, Toyota operated
through 541 consolidated subsidiaries (including variable interest entities) and 203 affiliated companies, of which
54 companies were accounted for through the equity method.
See “— Business Overview — Capital Expenditures and Divestitures” for a description of Toyota’s
principal capital expenditures and divestitures between April 1, 2012 and March 31, 2015 and information
concerning Toyota’s principal capital expenditures and divestitures currently in progress.
Toyota’s principal executive offices are located at 1 Toyota-cho, Toyota City, Aichi Prefecture 471-8571,
Japan. Toyota’s telephone number in Japan is +81-565-28-2121.
8

4.B BUSINESS OVERVIEW
Toyota primarily conducts business in the automotive industry. Toyota also conducts business in financeand other industries. Toyota sold 8,972 thousand vehicles in fiscal 2015 on a consolidated basis. Toyota had net
revenues of ¥27,234.5 billion and net income attributable to Toyota Motor Corporation of ¥2,173.3 billion in
fiscal 2015.
Toyota’s business segments are automotive operations, financial services operations and all otheroperations. The following table sets forth Toyota’s sales to external customers in each of its business segments
for each of the past three fiscal years.
Yen in millions
Year Ended March 31,
2013
2014
2015

Automotive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
All Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

20,378,762
1,150,042
535,388

23,733,855
1,379,267
578,789

25,006,224
1,621,685
606,612

Toyota’s automotive operations include the design, manufacture, assembly and sale of passenger cars,
minivans and commercial vehicles such as trucks and related parts and accessories. Toyota’s financial services
business consists primarily of providing financing to dealers and their customers for the purchase or lease of
Toyota vehicles. Toyota’s financial services also provide retail installment credit and leasing through thepurchase of installment and lease contracts originated by Toyota dealers. Related to Toyota’s automotive
operations is its development of intelligent transport systems (“ITS”). Toyota’s all other operations businesssegment includes the design and manufacture of prefabricated housing, information technology related
businesses including a web portal for automobile information called GAZOO.com, and sales promotions forKDDI’s communication-related products (predominantly the au brand).
Toyota sells its vehicles in approximately 170 countries and regions. Toyota’s primary markets for its
automobiles are Japan, North America, Europe and Asia. The following table sets forth Toyota’s sales to externalcustomers in each of its geographical markets for each of the past three fiscal years.
Yen in millions
Year Ended March 31,
2013
2014
2015

Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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

8,532,875
7,938,615
2,614,070
4,475,382
2,130,969

8,338,881
9,430,450
2,690,803
4,531,178
2,243,209* “Other” consists of Central and South America, Oceania, Africa and the Middle East.
During fiscal 2015, 24.0% of Toyota’s automobile unit sales on a consolidated basis were in Japan, 30.3%
were in North America, 9.6% were in Europe and 16.6% were in Asia. The remaining 19.5% of consolidated unit
sales were in other markets.
The Worldwide Automotive Market
Toyota estimates that annual worldwide vehicle sales totaled approximately 89 million units in 2014.
Automobile sales are affected by a number of factors including:•social, political and economic conditions;•introduction of new vehicles and technologies; and•costs incurred by customers to purchase and operate automobiles.
9

These factors can cause consumer demand to vary substantially from year to year in different geographic
markets and in individual categories of automobiles.
In fiscal 2015, the global economy experienced gradual expansion in developed countries with theUnited States as a driving force, while growth in emerging markets slowed down due to the relative weakening
currencies of emerging markets reflecting in part the end of U.S. monetary quantitative easing contributing to thestrength of the U.S. dollar, as well as due to the decline in prices of natural resources in resource-producing
countries contributing to the weakness of the local currency of such countries.
The automotive industry was also impacted by this trend. In 2014, with respect to developed countries,
markets in the United States expanded and the downturn bottomed out in Europe. In addition, in Japan, due to theconsumption tax increase in April 2014, market demand slowed down. In emerging markets, the expansion of theChinese market continued despite signs of weakness in the economy, but markets in other emerging countries
slowed down.
However, in the medium- to long-term, Toyota expects the automotive market to grow driven principally by
the growth in emerging markets. Global competition is expected to be severe, as competition in compact andlow-price vehicles intensifies, and technological development and development of new products become more
frequent with a heightened global awareness of the environment and more stringent fuel economy standards.
In 2014, China, North America, Europe and Asia were the world’s largest automotive markets. The share ofeach market across the globe, which Toyota estimates based on the available automobile sales data in eachcountry and region information, was 27% for China, 22% for North America (20% excluding Mexico and Puerto
Rico), 21% for Europe and 10% for Asia. In China, new vehicle sales increased to approximately 24.0 million
units. In North America, new vehicle sales increased to approximately 19.6 million units. In Europe, new vehicle
sales increased to approximately 18.4 million units. In Asia (including India but excluding Japan and China), newvehicle unit sales decreased slightly from the previous year to approximately 8.8 million units.
The worldwide automotive industry is affected significantly by government regulations aimed at reducing
harmful effects on the environment, enhancing vehicle safety and improving fuel economy. These regulations
have added to the cost of manufacturing vehicles. Many governments also mandate local procurement of partsand components and impose tariffs and other trade barriers and price or exchange controls as a means of creating
jobs, protecting domestic producers or influencing their balance of payments. Changes in regulatory
requirements and other government-imposed restrictions can limit an automaker’s operations. These regulations
can also make it difficult to repatriate profits to an automaker’s home country.
The development of the worldwide automotive market includes the continuing globalization of automotive
operations. Manufacturers seek to achieve globalization by localizing the design and manufacture of automobiles
and their parts and components in the markets in which they are sold. By expanding production capabilities
beyond their home markets, automotive manufacturers are able to reduce their exposure to fluctuations in foreignexchange rates as well as to trade restrictions and tariffs.
Recently, there have been many global business alliances and investments entered into between
manufacturers in the global automotive industry. There are various reasons behind these transactions including
the need to respond to the excessive global capacity in the production of automobiles, the need to reduce costs
and improve efficiency by increasing the number of automobiles produced using common vehicle platforms andby sharing research and development expenses for environmental and other technology, the desire to expand acompany’s global presence through increased size and the desire to expand into particular segments orgeographic markets.
Toyota believes that its research and development initiatives, particularly the development ofenvironmentally friendly new vehicle technologies, vehicle safety and information technology, provide it with astrategic advantage.
10

Toyota’s ability to compete in the global automotive industry will depend in part on Toyota’s successful
implementation of its business strategy. This is subject to a number of factors, some of which are not in Toyota’s
control. These factors are discussed in “Operating and Financial Review and Prospects” and elsewhere in thisannual report.
Toyota Global Vision
In March 2011, Toyota unveiled its “Toyota Global Vision” corporate outline for the future, which serves
not only to give direction to Toyota employees around the world, but also to convey such direction to customers
and to the public at large. Toyota will work to achieve sustained growth through the realization of the following
ideals which are parts of the Vision:“The safest and most responsible ways of moving people”•

Safety is Toyota’s highest priority, and Toyota will continue to provide world-class safety.

•

Toyota will also continue to contribute to environmental quality and to human happiness by using
leading environmental technology and by deploying that technology in a growing line of vehicle
models. At the same time, Toyota will work through the provision of products, sales and services thatexceed customer expectation to offer a rewarding experience for customers.

“Enriching lives around the world”•

Toyota has been consistently true to its founding spirit of serving society through conscientious
manufacturing, and it will continue working in that spirit to contribute to enhance the quality of life
wherever it has operations.

•Toyota will strive to continue contributing to economic vitality wherever it has operations by generating
stable employment and by participating in mutually beneficial business relationships with dealers andsuppliers. It will also strive to continue to actively engage in initiatives for human resources
development and the promotion of cultural activities of its host communities.

“Lead the way to the future of mobility”•

Toyota will lead the industry in technological development that will spawn next-generation mobility.
For example, it will explore possibilities in personal mobility and in the convergence of information
technology for automobiles and “smart grids” for optimizing energy generation and consumption.
Toyota will strive to offer products and services that match the needs in each market.

•

Toyota will strive to advance environmental technology and develop low-carbon technologies andtechnologies for maximizing safety through interaction with the transport infrastructure to lay afoundation for sustainable and amenable future mobility.

“Our commitment to quality, constant innovation”•

Toyota is committed to providing quality vehicles that are highly reliable and driven with a sense ofsafety and reliability.

•

Toyota will constantly reinvent itself and continue to engage in cutting-edge technology development.
Toyota will work towards offering vehicles around the world that address the needs of today and of
tomorrow at affordable prices.

“Continued awareness for the Earth and environment”•

Toyota will continue to work towards minimizing environmental impact in its manufacturing and otheroperations, and products.
11•With an emphasis on environmental awareness, Toyota will in its operations work towards energy
conservation, reduction in carbon dioxide emission, efficient use of resources such as recycling, andhuman resource development and production methods that allow for coexistence with nature.

“Exceed expectations and be rewarded with a smile”•

Everyone at Toyota will continuously maintain a sense of gratitude to customers and will strive to earnsmiles with products and services that are stimulating and inspiring and exceed customer expectations.

“There is always a better way”•

All Toyota employees will share the recognition that there is always a better way and share acommitment to continuous improvement, which are fundamental to The Toyota Way.

“Meet challenging goals by engaging the talent and passion of people”•

Toyota will nurture a corporate culture where teamwork and individual creativity thrive and where
people will approach their work with pride and passion.

•

Toyota will honor the spirit of diversity in recruiting, training and promoting capable individuals aroundthe world. Human resources development at Toyota will continue to promote the transfer of thecompany’s monozukuri spirit of conscientious manufacturing and related skills and know-how from one
generation to the next.

As for Toyota’s future business environment, in the world economy, the U.S. is expected to recover steadily.
Also the European economy is picking up gradually chiefly in the eurozone, while the economies of several
countries are likely to slow down, such as in Russia which is weighed down by declines in crude oil prices.
Emerging countries also show downside risk. The Japanese economy is expected to recover gradually throughimprovements in employment and income conditions, although attention needs to be paid to such factors as
uncertainty in overseas economies, which performance will affect the Japanese economy.
The automotive market is expected to expand gradually, led by the U.S. However, amid adaptation of
eco-car promotion policies in various countries and increased efforts toward the development of safety
technologies, as well as continuing advances in information and communication technology, fierce competition
exists on a global scale.
In this severe business environment, Toyota intends to steadily progress toward the realization of the Toyota
Global Vision through sustainable growth based on the following policies:
First, Toyota intends to reinforce its core competitiveness in order to grow as steadily as a tree adding
annual growth rings. It plans to work on quality improvement and human resource development in order tomanufacture vehicles that bring smiles to customers. In addition, it plans to thoroughly improve productivity ineach of its business operations through measures such as effective use of management resources and thestrengthening of its IT infrastructure.
Second, Toyota intends to take on bold challenges toward the creation of new value in order to progress into
the future. It plans to work toward the future of mobility through pioneering technologies, products andbusinesses.
In order to implement the above, Toyota intends to improve its management structure to speed up
decision-making, enhance the supervision of business execution, strengthen collaboration with Toyota groupcompanies and leverage the value of diversity.
Based on these initiatives, Toyota will contribute to “enriching lives of communities” by providing“ever-better cars.” This is expected to encourage more customers to purchase Toyota cars and thereby lead to the12establishment of a stable business base. By perpetuating this cycle, it will aim to realize sustainable growth andenhance corporate value. In addition, through full observance of corporate ethics such as compliance withapplicable laws and regulations, Toyota will fulfill its social responsibilities.
Automotive Operations
Toyota’s revenues from its automotive operations were ¥25,062.1 billion in fiscal 2015, ¥23,781.4 billion in
fiscal 2014 and ¥20,419.1 billion in fiscal 2013.
Toyota produces and sells passenger cars, minivans and commercial vehicles such as trucks. Toyota Motor
Corporation’s subsidiary, Daihatsu Motor Co., Ltd. (“Daihatsu”), produces and sells mini-vehicles and compact
cars. Hino Motors, Ltd. (“Hino”), also a subsidiary of Toyota Motor Corporation, produces and sells commercial
vehicles such as trucks and buses. Toyota also manufactures automotive parts, components and accessories for its
own use and for sale to others.
On March 4, 2015, Toyota Motor Corporation, Toyota Motor Sales & Marketing Corporation (“TMSM”), a
wholly-owned subsidiary of Toyota Motor Corporation, and Toyota Marketing Japan Corporation (“TMJ”), a
wholly-owned subsidiary of TMSM, announced that TMSM will merge with and into Toyota Motor Corporation
and TMJ’s motor sports business will be transferred to Toyota Motor Corporation.
Vehicle Models
Toyota’s vehicles (produced by Toyota, Daihatsu and Hino) can be classified into three categories: hybrid
vehicles, conventional engine vehicles, and fuel cell vehicles, which in December 2014 became available
commercially for the first time in the world, in the Japanese market. Toyota’s product line-up includes
subcompact and compact cars, mini-vehicles, mid-size, luxury, sports and specialty cars, recreational and sportutility vehicles, pickup trucks, minivans, trucks and buses.
Hybrid Vehicles
The world’s first mass-produced hybrid car was Toyota’s Prius. It runs on an efficient combination of agasoline engine and motor. This system allows the Prius to travel more efficiently than conventional engine
vehicles of comparable size and performance. The hybrid design of the Prius also results in the output of
75% less emission than the maximum amount allowed by Japanese environmental regulations. Toyota views thePrius as the cornerstone of its emphasis on designing and producing eco-friendly automobiles.
In the last three years, Toyota has strengthened its hybrid lineup by introducing the Prius plug-in and thefully remodeled GS450h in January 2012, the Yaris HV in May 2012, the ES300h in July 2012, the Auris HV in
November 2012, the Avalon HV and the fully remodeled Crown HV in December 2012, the fully remodeled
IS300h in May 2013, the fully remodeled Corolla Axio HV/Corolla Fielder HV in August 2013, the fully
remodeled Harrier HV in December 2013, the fully remodeled Voxy HV/Noah HV in January 2014, the NX300h
in July 2014, the RC300h and the Esquire HV in September 2014 and the fully remodeled Alphard and Vellfire
in January 2015. In the hybrid vehicles area, where strong growth is anticipated, Toyota aims to continue its
efforts to offer a diverse line-up of hybrid vehicles, enhance engine power while improving fuel economy andotherwise work towards increasing the sales of hybrid vehicles.
Fuel Cell Vehicles
Toyota began limited sales of a fuel cell vehicle in Japan and the United States in December 2002. In
June 2005, Toyota’s new fuel cell passenger vehicle became the first in Japan to acquire vehicle type certification
under the Road Vehicles Act, as amended, on March 31, 2005, by Japan’s Ministry of Land, Infrastructure,
Transport and Tourism. Leases for fuel cell vehicles began in July 2005. By 2007, Toyota was able to make13

improvements to start-up and cruising distance at temperatures below freezing, which were technologicalchallenges. Toyota has made advances by solving technological issues such as the above and worked towards thepractical use of such solutions, culminating in the general sale of the world’s first mass produced fuel cell vehicle
MIRAI in Japan beginning in December 2014.
Conventional Engine Vehicles
Subcompact and Compact
Toyota’s subcompact and compact cars include the four-door Corolla sedan, which is one of Toyota’s
bestselling models. The Yaris, marketed as the Vitz in Japan, is a subcompact car designed to perform better andoffer greater comfort than other compact cars available in the market with low emissions that are particularly
attractive to European consumers. In Europe, Toyota introduced the fully remodeled Aygo in June 2014. In
Japan, Toyota introduced the remodeled Corolla Axio/Fielder in May 2012, the remodeled Porte and its variant,
the Spade, in July 2012 and the remodeled Auris in August 2012. In India, Asia, China and other markets, Toyota
introduced the Etios and Vios. In addition, Toyota introduced the AGYA, which is designed and manufactured
by Daihatsu.
Mini-Vehicles
Mini-vehicles are manufactured and sold by Daihatsu. Daihatsu manufactures mini-vehicles, passenger
vehicles, commercial vehicles and auto parts. Mini-vehicles are passenger cars, vans or trucks with engine
displacements of 660 cubic centimeters or less. Daihatsu sold approximately 629 thousand mini-vehicles and
197 thousand automobiles on a consolidated basis during fiscal 2015. Daihatsu’s largest market is Japan, which
accounted for approximately 80% of Daihatsu’s unit sales during fiscal 2015. From 2011, Toyota began to sellsome mini-vehicles manufactured by Daihatsu under the Toyota brand.
Mid-Size
Toyota’s mid-size models include the Camry, which has been the bestselling passenger car in the
United States for seventeen of the past eighteen calendar years (from 1997 to present) and also for the last
thirteen consecutive years. The Camry was fully remodeled in August 2011. Camry sales in the United States for2014 were approximately 428 thousand units (including Camry hybrids). In addition, Toyota’s other mid-size
models include the REIZ for the Chinese market, the Avensis, which was remodeled in November 2008 for theEuropean market, and the Mark X, which was remodeled in October 2009 for the Japanese market.
Luxury & Large
In North America, Europe, Japan and other regions, Toyota’s luxury lineup consists primarily of vehicles
sold under the Lexus brand name. Lexus passenger car models include the LS, the GS, the ES, the IS, the HS, theCT and the RC. Lexus models also include the LX, the GX, the RX and the NX sold as luxury sport-utility
vehicles. Toyota commenced sales of its luxury automobiles in Japan under the Lexus brand in August 2005. Asof March 31, 2015, the Lexus brand lineup in Japan includes the LS, the GS, the HS, the IS, the CT, the RX, theNX and the RC. The Toyota brand’s full-size luxury car, the Avalon, was remodeled in October 2012, and the
Crown was remodeled in December 2012. Toyota also sells the Century limousine in Japan.
Sports and Specialty
In the United States Toyota sells the Scion tC, a sports model targeted at young drivers. In December 2010,
Toyota introduced the LFA model under the Lexus brand as the high-performance sports model, and in
April 2012, Toyota introduced the 86 (called Scion FR-S in the U.S.), a compact sports car with a front-mounted
engine and rear-wheel drive. In October 2014, Toyota introduced the RC coupe that leads the image of Lexus,
which engages drivers on a sentimental level.
14

Recreational and Sport-Utility Vehicles and Pickup Trucks
Toyota sells a variety of sport-utility vehicles and pickup trucks. Toyota’s sport-utility vehicles available inNorth America include the Sequoia, the 4Runner, the RAV4, the Highlander, the FJ Cruiser and the Land
Cruiser, and pickup trucks available are the Tacoma and Tundra. The Tacoma, the Tundra, the Highlander andthe Sequoia are manufactured in the United States. Toyota also offers four types of sport-utility vehicles under
the Lexus brand, including the LX, the GX, the RX, and the NX. Toyota also manufactures the RX and RAV4models in Canada. Toyota’s pickup truck, the Hilux, has been the bestselling model of all Toyota cars sold in
Thailand. In North America, the fully remodeled RAV4 was introduced in December 2012 and the fully
remodeled Highlander was introduced in December 2013. In July 2014, Toyota introduced the new NX model
under the Lexus brand, and in May 2015, Toyota introduced the fully remodeled Hilux in Thailand.
Minivans and Cabwagons
Toyota offers several basic models for the global minivan market. Its largest minivans in Japan, the Alphardand the Vellfire, were remodeled in January 2015. In addition, the Corolla Verso was remodeled in
December 2008 in Europe, and the Wish was remodeled in April 2009, the Noah/Voxy was remodeled in
January 2014 and the new model Esquire was introduced in October 2014 in Japan. Toyota’s other minivan
models include, in Japan, the Estima, the Sienta and the Isis, and, in North America, the Sienna.
Trucks and Buses
Toyota’s product lineup includes trucks (including vans) up to a gross vehicle weight of five tons andmicro-buses that are sold in Japan and in overseas markets. Trucks and buses are also manufactured and sold byHino, a subsidiary of Toyota. Hino’s product lineup includes large trucks with a gross vehicle weight of overeleven tons, medium trucks with a gross vehicle weight of between five and eleven tons and small trucks with agross vehicle weight of up to five tons. Hino’s bus lineup includes medium to large buses used primarily as tour
buses and public buses, small buses and micro-buses.
Product Development
New cars introduced in Japan during fiscal 2015 and thereafter include the RC, the NX, the Esquire and the
MIRAI. Remodeled cars in Japan during fiscal 2015 and thereafter include the Alphard, the Vellfire and the
PIXIS TRUCK. New vehicles developed during fiscal 2015 and thereafter and introduced outside of Japan
include the RC and the NX. Remodeled cars outside of Japan during fiscal 2015 and thereafter include the Aygo,
the Alphard, the Vellfire and the Hilux.
In addition, the IMV product lineup based on the IMV project to optimize global manufacturing and supply
systems is a lineup of strategic multipurpose vehicles produced from a single platform to meet market demand.
The IMV product lineup includes, as of March 31, 2015, the Hilux, Fortuner, and Innova, one or all of which areavailable in all regions except for Japan.

15Markets, Sales and Competition
Toyota’s primary markets are Japan, North America, Europe and Asia. The following table sets forth
Toyota’s consolidated vehicle unit sales by geographic market for the periods shown. The vehicle unit sales
below reflect vehicle sales made by Toyota to unconsolidated entities (recognized as sales under Toyota’s
revenue recognition policy), including sales to unconsolidated distributors and dealers. Vehicles sold by Daihatsu
and Hino are included in the vehicle unit sales figures set forth below.
2011
Units

MarketJapan . . . . . . . . . . . 1,913,117
North America . . . . 2,031,249
Europe . . . . . . . . . . 795,534
Asia . . . . . . . . . . . . 1,255,016
Other* . . . . . . . . . . 1,313,123

%

2012
Units

26.2% 2,070,799
27.8 1,872,423
10.9
797,99317.2 1,326,829
17.9 1,283,885%

Year Ended March 31,
2013
Units
%

28.2% 2,278,796
25.5 2,468,804
10.8
799,085
18.0 1,683,578
17.5 1,640,401

2014
Units

25.7% 2,365,410
27.8 2,529,398
9.0
844,00319.0 1,608,355
18.5 1,768,867

%

2015
Units

26.0% 2,153,694
27.7 2,715,173
9.3
859,038
17.6 1,488,922
19.4 1,755,037

%

24.0%
30.3
9.6
16.6
19.5

Total . . . . . . . . . . . . . . . . 7,308,039 100.0% 7,351,929 100.0% 8,870,664 100.0% 9,116,033 100.0% 8,971,864 100.0%* “Other” consists of Central and South America, Oceania, Africa and the Middle East, etc.

The following table sets forth Toyota’s vehicle unit sales and market share in Japan, North America, Europe
and Asia on a retail basis for the periods shown. Each market’s total sales and Toyota’s sales represent new
vehicle registrations in the relevant year (except for the Asia market where vehicle registration does notnecessarily apply). All information on Japan excludes mini-vehicles. The sales information contained below
excludes unit sales by Daihatsu and Hino, each a consolidated subsidiary of Toyota. Vehicle unit sales in Asia do
not include sales in China.

2011

Japan:
Total market sales (excluding mini-vehicles) . . . . . . . . . . . . .
Toyota sales (retail basis, excluding mini-vehicles) . . . . . . . .
Toyota market share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(Thousands of Units)
Fiscal Year Ended March 31,
2012
2013
2014

2015

2,975
3,067
3,242
3,433
3,126
1,407
1,396
1,570
1,605
1,439
47.3% 45.5% 48.4% 46.7% 46.0%(Thousands of Units)
Calendar Year Ended December 31,
2010
2011
2012
2013
2014

North America:
Total market sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Toyota sales (retail basis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Toyota market share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

14,058 15,417 17,153 18,514 19,597
2,008
1,880
2,360
2,520
2,670
14.3% 12.2% 13.8% 13.6% 13.6%

Europe:Total market sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Toyota sales (retail basis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Toyota market share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

18,368 19,074 18,171 18,009 18,397
808
820
838
848
888
4.4%
4.3%
4.6%
4.7%
4.8%

Asia (excluding China):
Total market sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Toyota sales (retail basis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Toyota market share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7,430
7,861
8,986
8,899
8,785
1,039
1,103
1,487
1,427
1,324
14.0% 14.0% 16.5% 16.0% 15.1%

16JapanJapan is one of the leading countries with respect to technological advancements and improvements and willcontinue to demonstrate such strength. Toyota strives to earn customer satisfaction by introducing products
distinctive of Japan’s manufacturing ability such as value-added products including Lexus models, hybrid
vehicles, vehicles with 3-seat rows and mini-vehicles. Toyota’s consolidated vehicle sales in Japan in fiscal
2015 was 2,154 thousand units, a decrease of 211 thousand units in comparison with the previous year. Toyota
endeavors to secure and maintain its large share of and position atop the Japanese market. Toyota held adomestic market share (excluding mini-vehicles) on a retail basis of 48.4% in fiscal 2013, 46.7% in fiscal
2014 and 46.0% in fiscal 2015.
Although Toyota’s principle is to conduct production in regions where it enjoys true competitiveness, itconsiders Japan to be the source of its good manufacturing practices. Toyota supports its operations worldwide
through measures such as the development of new technologies and products, low-volume vehicles tocomplement local production, production of global vehicle models which straddle multiple regions andsupporting overseas factories. Toyota will also launch the implementation of the new platform and the new unit
for the Toyota New Global Architecture (“TNGA”) globally, with Japan at the core. In Japan, Toyota is
implementing flexible production based on market needs, in order to support its large share of domestic sales.
In January 2011, Central Motor Co., Ltd., Toyota’s subsidiary, began production at its Tohoku plant,
implementing innovative production technology that realizes cost reductions. The Tohoku plant producescompact vehicles such as the Yaris sedan and the Corolla Axio. In addition, Kanto Auto Works, Ltd. became awholly-owned subsidiary of Toyota in January 2012. In July 2012, Toyota integrated Central Motor Co., Ltd.,
Kanto Auto Works, Ltd. and Toyota Motor Tohoku Corporation to establish Toyota Motor East Japan, Inc. as a
new company. This integration is intended to enable Toyota Motor East Japan, Inc. to design, develop, andproduce globally competitive compact cars, manufacture auto parts and support Toyota’s overseas operations.
Toyota has established three domestic production bases, each of which are in the Tokai, Kyushu and Tohoku
regions.
In January 2012, Toyota Auto Body Co., Ltd. became a wholly-owned subsidiary of Toyota. Toyota Auto
Body Co., Ltd. is primarily responsible for integrating the planning, development and production of minivans,commercial vehicles, SUVs, etc.
Since Toyota formed an alliance with Fuji Heavy Industries, Ltd. (“FHI”) in 2005, Toyota and FHI have
utilized each other’s resources in development and production. In April 2008, in order to create synergy and tofurther strengthen competitiveness, Toyota, Daihatsu and FHI agreed on the following three points: (1) Toyota
and FHI will jointly develop a compact rear-wheel-drive sports car that will be marketed by both Toyota and
FHI, (2) Toyota will provide FHI with a compact car on an original equipment manufacturing basis (“OEM”) and(3) Daihatsu will supply FHI with mini-vehicles and an FHI version of the Daihatsu Coo compact car on an
OEM basis. In order to promote a smooth cooperation, FHI transferred 61 million FHI shares owned by FHI to
Toyota in July 2008. As a result of this transfer, Toyota owns 16.5% of FHI issued shares. While Toyota vehicles
have been manufactured at FHI’s North American production center, Subaru of Indiana Automotive, Inc., since2007, Toyota and FHI have decided to cease such production in the fall of 2016, and the collaboration between
Toyota and FHI will shift going forward to collaboration focusing on products and technology.
In Japan, there are five major domestic manufacturers, five specialized domestic manufacturers and a
growing volume of imports from major United States and European manufacturers. The prolonged economic
slump in the Japanese economy and the recent increases in environmental awareness have also shifted consumer
preference towards more affordable automobiles such as compact and subcompact vehicles and towards utility
vehicles such as mini-vans. For more than 40 years, Toyota has maintained its position as the largest automobile
manufacturer in Japan. Every year since fiscal 1999, Toyota, excluding Daihatsu and Hino, has achieved amarket share (excluding mini-vehicles) of over 40%, reflecting in part the success of the introduction of newmodels for subcompact and compact cars, mini-vans and sedans. In August 2005, Toyota launched the Lexus
17brand in Japan and achieved a record top market share of 25.6% in the luxury market in 2011. Toyota aims tofurther distinguish the Lexus brand by continuing to attract new and affluent customers including customers thattypically had purchased imported vehicles.
North America
The North American region is one of Toyota’s most significant markets. While the automotive market
struggled in the aftermath of the financial crisis beginning in 2008, Toyota has since reorganized its production
structure and made improvements to its product lineup. In addition, Toyota is actively working to promoteincreased local operations independence in North America, in accordance with the Toyota Global Vision,
announced in 2011.
In the North American region, of which the U.S. is the center, Toyota has a wide product lineup (excluding
large trucks and buses), and sold 2,715 thousand vehicles on a consolidated basis in fiscal 2015. This represents
approximately 30% of Toyota’s total unit sales on a consolidated basis. The U.S., in particular, is the largest
market in the North American region, accounting for 89% of the retail sales of Toyota in such region. Sales
figures for fiscal 2015 were 107.3% of those in the previous fiscal year.
Toyota commenced sales of the first-generation Prius hybrid model in North America in 2000. The Prius
became Toyota’s bestselling model behind the Corolla and Camry, having gained particular support amongcustomers concerned with the environment. Toyota introduced the first hybrid model under the Lexus brand, theRX400h, and the Highlander hybrid in 2005. Further, Toyota continued expanding its hybrid models with theintroduction of models such as the HS250h in 2009, the CT200h and the Prius V in 2011, the Prius C, the EShand the Avalon HV in 2012 and the NXh in 2014.
Since the introduction of the LS and ES models under the premium brand model, Lexus, in the United Statesin 1989, Toyota has expanded its Lexus sales with models including the GS, IS and RX. In 2012, Toyota
introduced the all-new GS and ES models, and unit sales reached 244 thousand units. Toyota is seeking tosteadily increase sales every year and achieved sales of 274 thousand units through the introduction of the new
IS model in 2013 and 311 thousand units through the introduction of the new NX and RC models in 2014.
Toyota is continuing to revise its vehicle models and North American production capacities in response tochanges in market conditions. Starting 2011, Toyota, instead of importing from Japan, began production of theCorolla at its Mississippi plant. In 2013, the production capacity at the Woodstock plant in Canada increased
from 150 to 200 thousand units per year, and the production capacity at the Indiana plant also increased. Toyota
commenced production of the RX450h hybrid model at its Cambridge plant in Canada in 2014. Through thebusiness alliance with Mazda Motor Corporation, the production of Toyota brand light vehicles for sale mainly inNorth America is scheduled to begin at Mazda’s plant in Mexico in July 2015. In addition, Toyota has decided tocommence production of the Lexus ES350 at its Kentucky plant for sale in the North America market starting in
the fall.
In terms of auto parts, Toyota increased production capacity of engine plants in Kentucky and Alabama in2013 and 2014, respectively, to meet rising demand, and also increased production capacity of auto parts at its
automatic transmission plant in West Virginia in 2014.
In order to further strengthen competitiveness in North America, Toyota will continue the realignment ofNorth American manufacturing operations going forward. As part of this effort, a new plant will be built in
Mexico in 2019 and production of the Corolla will be shifted from the plant in Canada to the new plant in
Mexico. Compact cars will also be produced at the new plant as well as at the plant in Mississippi. Toyota willconsider focusing its production of mid-sized vehicles in the plant in Canada, along with the plants in Indiana
and Kentucky, by commencing production of mid-sized vehicles instead of the Corolla in Canada starting in
2019.
18

As for Toyota’s vehicle development in North America, the Toyota Technical Center spearheads the design,planning, and evaluation of vehicles and parts as to their ability to meet customer needs. Toyota will continue topromote self-reliance towards producing even better cars in the future.
In April 2014, Toyota decided to relocate its North American headquarters for manufacturing, sales andmarketing, financial services and other functions to the city of Plano in northern Dallas, Texas. By unifying its
North American operations, Toyota plans to promote collaboration and efficiencies across functions, position
itself to deliver “ever-better cars” to customers and work towards realizing sustainable growth in the
North America market. The relocation is expected to take place following the completion of the construction of
the new headquarters in late 2016 or early 2017.
EuropeWhile competition continues to intensify, Toyota has expanded its lineup of hybrid models to further
strengthen its sales operations, and has entered into supply agreements with BMW and PSA for diesel engines
and light commercial vehicles, respectively. As a result, Toyota launched the BMW engine-equipped Verso inearly 2014 and plans to expand to other models in the future. Toyota also began sales of light commercial
vehicles supplied by PSA from mid-2013. In addition, Toyota is actively promoting production and sales
measures that meet local demand by strengthening its value chain including used car dealerships, after-sales
services and finance and insurance services.
In 2014, while the market recovered steadily in the eurozone, the market in Eastern European countries,
mainly in Russia, slowed down due to factors such as the situation in Ukrainian and decline in crude oil prices.
Sales in 2014 in Europe exceeded the previous year’s figures due to increased sales in major markets
resulting from the introduction of new models and increased sales of hybrid models. Going forward, Toyota will
strive to maintain sales with the expansion of its product lineup while being responsive to market risks. Toyota’s
consolidated vehicle sales in Europe in fiscal 2015 was 859 thousand units, an increase of 1.8% from fiscal 2014.
Toyota has in the past increased European production in response to sales growth, establishing Toyota
Motor Manufacturing (UK) Ltd. (“TMUK”) in 1992, Toyota Motor Manufacturing Turkey Inc. (“TMMT”) in
1994 and Toyota Motor Manufacturing France S.A.S. (“TMMF”) in 2001. Further, in 2005, Toyota Peugeot
Citroën Automobile Czech was formed as a result of a joint venture with PSA Peugeot Citroën as vehicle supply
factories to Europe. At the time of the economic crisis in Europe, Toyota promptly reduced personnel and madeadjustments to its plant operations. In addition, in 2010, TMUK limited its production to one production line at
its Burnaston plant. At the same time, Toyota conducted measures such as changing from a two-shift to a oneshift production operation at TMMT and change from a three-shift to a two-shift production operation at Toyota
Motor Manufacturing Poland SP.zo.o. To increase the utilization rate of these factories, Toyota began to transfer
the production of the Corolla from South Africa to TMMT and commenced exporting the TMMF Yaris to North
America in 2013.
Toyota opened the Toyota Motor Manufacturing Russia (TMMR) plant in 2007 as a base for its
manufacturing operations in the Russian market, where future growth is expected. A two-shift production
operation started in September 2012 and production capacity was increased from 20,000 units to 50,000 units per
year. In addition, Toyota decided in September 2013 to manufacture a second model, namely the RAV4.
Moreover, OOO “Toyota Motor” (sales) and TMMR were merged into one company at the end of 2013 tostrengthen the business base and promote coordination of manufacturing and sales operations. In addition,
Toyota commenced contract assembly of SUVs by Sollers Bussan in Vladivostok in February 2013. Toyota
commenced complete knock down, or CKD, production of SUVs in Kazakhstan beginning in the spring of 2014.
Toyota’s principal European markets are Germany, France, the United Kingdom, Italy, Spain and Russia.
Toyota’s principal competitors in Europe are Volkswagen, Renault, Ford, Opel and Peugeot, as well as Korean
manufacturers Hyundai and Kia.
19

Asia
Toyota’s consolidated vehicle sales in Asia (including China) in fiscal 2015 was 1,489 thousand units, adecrease of 7.4% from fiscal 2014.
In light of the importance of the Asian market that is further expected to grow in the long term, Toyota aims
to build an operational framework that is efficient and self-reliant as well as a predominant position in theautomotive market in Asia. Toyota has responded to increasing competition in Asia by making strategic
investments in the market and developing relationships with local suppliers. Toyota believes that its existing
local presence in the market provides it with an advantage over new entrants to the market and expects to be able
to promptly respond to demand for vehicles in the region.
In this region, Toyota has been further strengthening its business foundations by improving its productline-up, expanding local procurement and increasing production capacities.
As an example of enhancing the product line-up, Toyota began producing IMVs (the Hilux, Fortuner andInnova) in Thailand, Indonesia, India, the Philippines and Malaysia in 2005 and in Vietnam in 2006.
Furthermore, with increased production capacity, the Thailand plant now produces IMVs for export outside ofAsia, including to Australia and to the Middle East, contributing greatly to the expansion of Toyota’s automotive
business.
As part of Toyota’s efforts to expand business, Toyota Motor Thailand Co., Ltd. commenced production of
the Camry hybrid in 2009 and Prius in 2011. Toyota also started operation of its second Gateway plant in 2013,
expanding production capacity by 80 thousand units in Thailand to 810 thousand units. In April 2015, Toyota
implemented a full model change for IMV models manufactured at its plant in Thailand.
In India, Toyota constructed a second plant with an annual production capacity of 70 thousand units andcommenced production and sales of the Etios compact model designed specifically for the Indian market in 2010.
Furthermore, Toyota increased production capacity in India during 2012 and 2013 to 210 thousand units.
Moreover, Toyota began exporting the gasoline-fueled model of the Etios to South Africa from India in 2012.
In Indonesia, Toyota introduced the Etios and commenced operation of a second plant in Karawang in 2013
in order to meet the diverse customer needs and the expanding market. In 2014, Toyota increased the initial
production capacity of 70 thousand units per year to 120 thousand units per year with the introduction of the Viosand the Yaris, and also began exporting the Vios to the Middle East. Toyota also began construction of apassenger vehicle engine plant to commence production at the beginning of 2016. In Malaysia, Toyota began
production of the Camry hybrid in March 2015. In addition, in 2012 Toyota began production and sales of the
Camry hybrid in Taiwan to accommodate the spread of environmentally-friendly vehicles. Moreover, in light of
the free trade agreement between the U.S. and Korea, Toyota began sales of the U.S.-produced Camry in Korea
in January 2012.
Toyota’s principal Asian markets are Thailand, Indonesia, India, Malaysia and Taiwan.
China
Toyota has been conducting its operations in China through joint ventures, and its success in producing
products that meet local demands and in establishing its sales and service network has significantly contributed to
Toyota’s profits. Based on the firm business foundation that it has established, Toyota is conducting its
operations with the aim of promoting further growth and increasing profitability through further development of
its sales and service network and expansion of its product lineup.
In China, Toyota has been conducting joint ventures with two major partners. First, with respect to the joint
venture with China FAW Group Corporation since Toyota first launched the Vios through the joint venture in20

2002, Toyota has been producing and selling the Land Cruiser Prado, the Land Cruiser, the Corolla, the Crown,
the REIZ, the Coaster, the RAV4 and the Prius in China. With regard to production capacity, in 2007, Toyota
commenced production at the new Tianjin Teda plant, which has an annual production capacity of 200 thousand
units, and in 2012, commenced production at a new factory in Changchun, China, which has an annual
production capacity of 100 thousand units. Toyota also increased annual production capacity of the plant in
Sichuan from 30 thousand units to 50 thousand units in the spring of 2015 to increase production of the Prado.
GAC Toyota Motor Co., Ltd., a joint venture between Toyota and Guangzhou Automobile Group Co., Ltd.,
commenced sales of the Camry in 2006, followed by production and sales of the Yaris, the Highlander, the E’z
and the Levin. In 2006, it commenced production at the first plant on a single shift basis with an annual
production capacity of 100 thousand units and expanded its annual production capacity to 200 thousand units on
a double shift basis. In addition, a second plant commenced production in 2009 and Toyota plans to complete
construction of a third plant in 2017. In terms of auto parts, in 2014, Toyota opened a plant in Changshu in
Jiangsu, China for the production of the CVT as the first CVT plant outside of Japan. Toyota also plans to open aplant to produce hybrid vehicle batteries in October 2015.
Total vehicle sales in the Chinese market increased 8% from 22.19 million in 2013 to 24.00 million in 2014.
In this market, Toyota’s sales in 2014 were 1.03 million vehicles, up 13% from the previous year. In thepassenger vehicle market (17.80 million units), Toyota had a market share of 6%. In 2014, favorable conditionsin the less-than-1.6 liter market continued, and the SUV market expanded as a result of customers’ value
diversification. As for Toyota’s distribution network, Toyota has been expanding the distribution network for
locally produced vehicles in cooperation with Chinese joint venture partners under Tianjin FAW Toyota MotorCo., Ltd. and Guanqi Toyota Motor Co., Ltd., and for imported vehicles, Toyota has also been expanding
primarily the Lexus brand sales network. Toyota plans to further increase sales by expanding the number ofdealers and the product lineup for both locally produced and imported vehicles, particularly inland. In addition,
as the market in China develops, Toyota plans to promote the so-called “Value Chain” businesses such as usedcars, services, financing and insurance.
South and Central America, Oceania, Africa and the Middle East
Toyota’s consolidated vehicle sales in South and Central America, Oceania, Africa and the Middle East
(collectively, the “Four Regions”) in fiscal 2015 remained around the same at 1,755 thousand units, a decrease of
0.8% from fiscal 2014. The core models in this region are global models such as the Corolla, IMV (the Hilux)
and Camry. In order to increase production of IMVs, Toyota expanded the annual production capacity of its
Argentina factory from 70 thousand units to 90 thousand units in 2011. Toyota is seeking to further increase its
annual production capacity to 140 thousand units per year during 2015 and 2016. In order to expand business in
Brazil, Toyota constructed a new factory in Sorocaba with an annual production capacity of 70 thousand units,
and in 2012, began production and sales of the compact vehicles. Starting from 2016, Toyota plans to increase
production capacity to 110 thousand units per year. Further, Toyota began local production of the Fortuner in
Egypt in 2012. Moreover, in terms of auto parts, Toyota plans to commence production at a plant in Brazil forpassenger vehicle engines in 2016.
Toyota decided to end production of vehicles and engines at Toyota Motor Corporation Australia Ltd. by theend of 2017.
In these regions, which are expected to become increasingly important to Toyota’s business strategy, Toyota
aims to develop new products which meet the specific demands of each region, increase production and further
promote sales.
Toyota’s principal markets in the Four Regions are Brazil in South and Central America, Australia in
Oceania, South Africa in Africa and Saudi Arabia in the Middle East.

21

Production
Toyota and its affiliated companies produce automobiles and related parts and components through morethan 50 overseas manufacturing companies in 28 countries and regions besides Japan. Toyota’s major
manufacturing facilities include plants in Japan, the United States, Canada, the United Kingdom, France, Turkey,
Thailand, China, Taiwan, India, Indonesia, South Africa, Australia, Argentina and Brazil. Daihatsu brandvehicles are produced at 4 factories in Japan and 4 manufacturing companies in 3 other countries, includingIndonesia and Malaysia. Hino brand vehicles are produced at 2 factories in Japan and 10 manufacturing
companies in 10 countries, including Indonesia and Thailand. For a listing of Toyota’s principal production
facilities, see “Information on the Company — Property, Plants and Equipment”.
In promoting a sustainable growth strategy, establishing a system capable of providing optimal supply of
products in the global market is integral to Toyota’s strategy.
In line with its basic policy of manufacturing where there is demand and where Toyota is truly competitive,
Toyota will make efficient use of and maximize capacity utilization at its existing plants to respond to the
expanding market and will continue to focus on making efficient capital investments as necessary. Furthermore,
Toyota will continue to place top priority on safety and quality in strengthening true competitiveness with theaim of achieving sustainable growth.
In 2014, 76.5% of Toyota vehicles sold in overseas markets were manufactured in overseas plants by
Toyota and its unconsolidated affiliated companies. In 2014, approximately 74.4% of Toyota vehicles sold in
North America were produced in North America. Of the vehicles sold in Europe in 2014, approximately 73.7%
were produced in Europe. In fiscal 2015, Toyota produced on a consolidated basis 4,125 thousand vehicles inJapan and 4,805 thousand vehicles overseas compared to 4,345 thousand vehicles in Japan and 4,687 thousand
vehicles overseas in fiscal 2014.
The following table shows the worldwide vehicle unit production by Toyota for the periods shown. These
production figures do not include vehicles produced by Toyota’s unconsolidated affiliated companies. The sales
unit information elsewhere in this annual report includes sales of vehicles produced by these affiliatedcompanies. Vehicles produced by Daihatsu and Hino are included in the vehicle production figures set forth
below.

Units Produced . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Year Ended March 31,
2013
2014

2011

2012

7,169,721

7,435,781

8,698,454

9,032,165

2015

8,929,887

Toyota closely monitors its actual units of sale, market share and units of production data and uses thisinformation to allocate resources to existing manufacturing facilities and to plan for future expansions.
See “— Capital Expenditures and Divestitures” for a description of Toyota’s recent investments incompleted plant constructions and for a description of Toyota’s current investments in ongoing plant
constructions.
The Toyota Production System
Toyota pioneered the internationally recognized production system known as the “Toyota Production
System”. The Toyota Production System is based on Toyota’s own concepts of efficient production of only
necessary and quality products and efficient cost reduction, and has the following two principal elements:•“Just-in-Time”, and•“Jidoka”.
22Just-in-Time is an approach in which necessary parts and components are manufactured and delivered in justthe right quantity in a timely manner just as they are needed. This allows Toyota to maintain low levels of
inventory while maintaining operating efficiency.
Jidoka is a production concept which involves immediate stop of work when problems arise in the
production line in order to stop the production of defective items from being passed on to subsequent stages ofthe process, and therefore making quality assurance an inherent part of the production process. To achieve this,Toyota’s equipment is designed to detect and highlight abnormalities and to stop whenever abnormalities occur.
Toyota also authorizes its machine operators and other members of its production team to stop production
whenever they note anything suspicious. This helps Toyota to build quality into the production process by
avoiding defects and preventing the waste that would result from producing a series of defective items.
Toyota believes that the Toyota Production System allows it to achieve mass-production efficiencies even in
high-mix, low-volume production. This belief gives Toyota the flexibility to respond to changing consumer
demand without significantly increasing production costs. While the Toyota Production System remains the basisof Toyota’s automobile production, the system has been expanded for use in Toyota’s parts production, logistics
and customer service activities as well.
Through the Toyota Production System, issues are identified and analyzed at the actual site, the entire
production process is made visible and production efficiency as well as product quality are improved through theapplication of measures to address the sources of problems. As one method to implement these measures, Toyota
utilizes sophisticated information technologies to improve each step of its vehicle development process, fromproduct planning to commencement of mass-production. These technologies are intended to enhance flexibility,
simplification, quality, cost competitiveness and speed. Specifically, detailed virtual assembly and othersimulations of manufacturing processes are conducted on computers for a new vehicle or new production
equipment/systems before a prototype is made. An actual prototype is made only after defects and related issues
have been identified and resolved by computer simulation, thereby minimizing the time required for rebuilding
prototypes and significantly shortening the time required before starting mass production. Moreover, this system
is used to prepare virtual factories and other visual aids in order to facilitate training and communication atoverseas plants and enable the efficient transfer of necessary technology and skills.
In order to strengthen manufacturing and promote localization of overseas production, Toyota establishedthe Global Production Center (“GPC”) in July 2003 as a development and training center for global humanresources. The GPC is intended to introduce local managers to the Toyota methodology, allowing them to train
their subordinates while managing locally. GPC develops simple, easy-to-understand and efficient training
systems for the development of explicit knowledge. One characteristic of the GPC is that managers andsupervisors, new hires and experienced workers can all receive common skill-training. GPC’s training system
involves a pre-training phase where trainees learn basic skills and discover the skills that they must acquire
through image training. This is followed by various steps, from basic skill training and elemental task training tostandard task training, which ensures a step-by-step training. The fruits of this training method are reduced
training time, higher levels of achievement and the efficiency of training. Since January 2006, Toyota has opened
regional GPCs in North America, Europe and Asia. In each region, Toyota commenced courses where trainees
from each department are trained by local trainers to become trainers themselves.
In April 2015, the GPC was reorganized into TPS Promotion Center in order to promote TPS (Toyota
Production System) and activities centering on improving production engineering and manufacturing methods ateach manufacturing process by sharing global best standards in cooperation across different plants in order tofoster highly skilled workers and improve logistics in order to comprehensively improve manufacturing abilities.
Through these activities, Toyota has been making efforts to resolve issues relating to the entire supply chain.

23

Toyota is working company-wide towards the production of “ever-better cars.” The production engineeringand manufacturing divisions are developing Toyota’s own innovative production systems, equipment andprocessing technologies and deploying them in production lines in order to produce vehicles that create
excitement, joy and fun for customers through truly competitive manufacturing methods.
Distribution
Toyota’s automotive sales distribution network is the largest in Japan. As of March 31, 2015, this network
consisted of 280 dealers employing approximately 33 thousand sales personnel and operating approximately
4.7 thousand sales and service outlets. Toyota owns 15 of these dealers and the remainder is independent.
Toyota believes that this extensive sales network has been an important factor in its success in the Japanesemarket. A large number of the cars sold in Japan are purchased from salespersons who visit customers in theirhomes or offices. In recent years, however, the traditional method of sales through home visits is being replacedby showroom sales and the percentage of automobile purchases through showrooms has been gradually
increasing. Toyota expects this trend to continue, and accordingly, is working to improve its sales activities suchas customer reception and meticulous service at showrooms to increase customer satisfaction.
Sales of Toyota vehicles in Japan are conducted through four sales channels — “Toyota,” “Toyopet,”“Corolla” and “Netz.” In addition, Toyota introduced the Lexus brand to the Japanese market in August 2005,
and currently distributes the Lexus brand vehicles through a network of 166 sales outlets in order to enhance its
competitiveness in the domestic luxury automobile market. The following table provides information for eachchannel as of March 31, 2015.
Dealers
ChannelToyota . . . . . . . . . . . . .
Toyopet . . . . . . . . . . . .
Corolla . . . . . . . . . . . . .
Netz . . . . . . . . . . . . . . .

ToyotaOwned

Independent

Total

Market Focus

4
4
4
3

45
48
70
102

49
52
74
105

Luxury channel for Toyota brand vehicles
Leading channel for the medium market
Volume retail channel centering on compact models
Sales channel targeting customers with new values forthe 21st century

Brand

Lexus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Sales
Outlets

166

Market Focus

Premium brandOutside Japan, Toyota vehicles are sold through approximately 170 distributors in approximately
190 countries and regions. Through these distributors, Toyota maintains networks of dealers. The chart below
shows the number of Toyota distributors as of March 31, 2015 by country and region:
Country/Region

North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia (excluding China) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Oceania . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Middle East . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Central and South America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

24

Number of Countries

Number of Distributors

3
56
1
17
17
17
54
30

5
30
4
12
15
16
45
40

Improving Efficiency
Toyota is working on the following to create a corporate structure allowing for efficient development,
production and sales that can respond flexibly to changes in the external environment:•

working with suppliers as one team to dramatically increase the efficiency of development;•

creating a production structure that can better withstand fluctuations in demand and currency exchange
rates; and•strengthening sales capabilities in line with local conditions.

Toyota also plans to improve profitability and enhance operating efficiency by continuing to pursue
aggressive cost reduction programs, including:•

improving product development and production efficiencies through the re-integration and improvementof vehicle platforms and power trains as well as through the development of electronic platforms whichorganize electronic devices of vehicles as a package and standardize electronic structure andinfrastructure;•

implementing Ryohin-Renka Cost Innovation (“RR-CI”) activity, which aims for the elimination ofwaste in all processes from design to production while ensuring the reliability and safety of each part;•

applying advanced information technologies to improve efficiency throughout the product development
and production processes;•

promoting global reinforcement of the supply base under an open and fair purchasing policy;•

streamlining production systems; and•improving the efficiency of domestic and international distribution.

Toyota is further improving production efficiency by installing more versatile equipment and systems,
modifying vehicle body designs to allow for a greater variety of models on each production line and sharing
more parts among vehicles, not simply among different models but also among different platforms.
In April 2012, Toyota announced a new development framework, the TNGA, which reconciles sweeping
advances in product appeal with cost reductions. The new framework sets forth an architecture that incorporates
not only the three fundamental vehicle functions of moving, turning and stopping, but also ergonomics such as
driving position as well as freedom of design. Toyota plans to efficiently develop cars with high basicperformance attributes by developing parts and modules based on this architecture. The TNGA provides forhandling multiple models simultaneously in grouped development projects that will increase the sharing of partsand core vehicle components. This sharing, carried out in cooperation with suppliers, will result in lowered costs,
thereby allowing developmental manpower and funds to be reinvested in R&D to meet consumer preferences andR&D to meet regional needs, resulting in further product improvement.
By April 2013, Toyota established systems to rapidly promote the TNGA. Toyota is promoting companywide activities to reevaluate the way it does business from the ground up in order to continue producing highquality, profitable and attractive cars.
Enhancing Vehicle Functionality and Realizing a Smart Mobility Society
Toyota is striving to realize a smart mobility society in which people feel at ease and excited about being incars and in everyday life by connecting vehicles, people and communities in order to meet the needs of rapidlychanging societies, including the falling birth rate and aging populations in developed nations and an increasingly
diverse range of energy sources, among others. In particular, Toyota aims to contribute to an affluent lifestylethat offers peace of mind by enhancing vehicle functionality that will increase the attractiveness of vehicles and25the excitement of driving, enhancing transport systems that make being in cars more comfortable and moreenvironmentally friendly, and realizing Smart Communities that aim for optimization of local energy use andestablishment of a low-carbon emission transportation system.
Enhancing Vehicle Functionality — Information Service Functions
To Toyota, enhancing vehicle functionality means advancing information service functions that integrate
vehicles with telecommunication systems, and driving assistance functions that use communication technologies
and sensor technologies to create vehicles with intelligent features. Information service functions can improve
convenience and enrich the driving experience through information communication technologies that add newfunctions that are connected to the basic vehicle functions of “running, turning and stopping.” Examples include
the following:•

Toyota is advancing enhancement of car navigation systems, such as car parking maps that display
detailed information inside car parks, as well as the VICS system (Vehicle Information andCommunication System) that provides real-time road traffic information such as congestion, accidents,
traffic restrictions and parking. Car navigation systems play an increasingly important role in providing
drivers with various types of information on safety, smooth traveling, comfort and convenience.

•

T-Connect/G-BOOK is the latest information network service that merges the latest network
technologies and car multimedia a step ahead of the arrival of the ubiquitous network society.
T-Connect/G-BOOK provides various types of information useful for driving, as well as safety andsecurity services that detect unusual conditions in the vehicle, thereby supporting a lifestyle with one’s
vehicles anytime and anywhere through a network. In 2005, Toyota started G-BOOK ALPHA and
G-Link for Lexus, each with additional various features including traffic congestion forecast service. In
2007, Toyota launched G-BOOK mX, which in addition to the well-received conventional safety andsecurity services of G-BOOK, introduced even more useful car navigation services such as “Map-onDemand” — the world’s first technology for automatically updating map data — and “Probe
Communication Traffic Information” that provides drivers with highly precise information on traffic
congestion. In 2014, Toyota launched T-Connect, which in addition to conventional telematics services,
provides new services and functions through the distribution of applications to on-board device, as well
as destination and other information searches through the adoption of a voice recognition system.

•

HELPNET is an emergency dial system that, in the event of a traffic accident or medical emergency,transmits information required for emergency rescue, such as present-location data and vehicle details,
either automatically or with the touch of a button. It immediately contacts police and fire departments
through the HELPNET Operation Center. This system is integrated into T-Connect/G-BOOK and
G-Link to improve the quality of services. HELPNET shortens the time taken to report following an
emergency situation, which contributes to decreasing the number of traffic accident fatalities andreducing the level of impact, while at the same time aiming to prevent secondary disasters and easetraffic congestion.

In addition to the above, Toyota also operates a Japanese-language web portal for automobile information,GAZOO.com. The name “GAZOO” originates from the Japanese word gazo, meaning images. GAZOO wasestablished as an Internet membership service linking Toyota, its national dealer network and GAZOO members,
and has provided information on new and used Toyota vehicles and related services, as well as online shopping
services. GAZOO currently provides information on not only Toyota vehicles but also other automakers, as well
as offering a rich blog feature as a social networking portal site on automobiles. In addition, GAZOO featuresGAZOO Racing and Gazoo mura, through which Toyota aims to expand the fan base of car enthusiasts bypromoting activities such as user-participatory motor sports, where customers can experience in real life theenjoyment that cars offer, to further complement its contents line-up. Toyota utilized its GAZOO technology tofurther expand its automobile information service by launching the G-BOOK telematics service in Japan in fall
2002 and G-Link, which is a service exclusive to Lexus, in August 2005. Toyota also offers a theft detection
system, vehicle tracking service and operator support service as standard services to enhance services aiming to26

provide safety, security and comfort for T-Connect/G-BOOK and G-Link users in their lifestyle using vehicles.
With G-BOOK mX announced in April 2007, Toyota started offering services that allow drivers to use moreconvenient navigation systems such as “Map-on-Demand” — the world’s first technology for automatically
updating map data. In addition, Toyota has further strengthened its linkage between GAZOO and G-BOOK andhas, for example, allowed map information searched on a blog on GAZOO.com to be used on G-BOOK, further
maturing as a comprehensive telematics service. In Japan, Toyota is seeking to promote the use of the
T-Connect/G-BOOK by equipping all Lexus models and certain Crown models with the T-Connect/G-BOOK asa standard feature. Toyota has also licensed its T-Connect/G-BOOK technology to certain other competitors inJapan. Toyota is applying the technology and experience which it has accumulated in Japan to regions outside
Japan; G-BOOK services were introduced in China in March 2009, and unique telematics services in the UnitedStates were launched in August 2009. In addition, Toyota began offering telematics services for smartphones in
December 2010 in Japan, and began to offer the same service in Thailand in March 2012 and the Middle East
from January 2014 (UAE, Qatar and Lebanon in January 2014, Saudi Arabia in August 2014, Bahrain in
October 2014 and Kuwait in January 2015).
In addition, in March 2004, Toyota launched its CRM (Customer Relationship Management) system called
e-CRB (evolutionary Customer Relationship Building) in Thailand. e-CRB builds on a technology cultivatedthrough the development of Gazoo and G-BOOK and offers its customers a variety of services such as providing
information on new vehicles, accepting requests for brochures and estimates and notifying customers when it istime for maintenance by keeping track of the vehicle’s maintenance history and mileage. In addition, e-CRB
offers an advanced operation system that can be utilized comprehensively at dealers including new and used cars
and services. Toyota is promoting e-CRB in countries such as China, Thailand, Australia, India and Brazil where
steady progress has been made as the service-in ratio has increased. In 2013, Toyota introduced the nextgeneration e-CRB that adopts tablet terminals (portable information processing terminals) in China. These tablet
terminals are supporting the improvement of customer satisfaction at points of sale and in after-sale service.
Toyota also introduced a system called Sales Logistics Integrated Management (“SLIM”) in Guangzhou,
China and India. By utilizing real sales information and linking with production and distribution, Toyota is able
to realize the Just-in-Time production system of producing and delivering only the number of vehicles that havebeen sold. SLIM has been recognized to significantly increase the freshness of inventory and improve cash flow.
In September 2010, Toyota announced its smart-grid initiatives, which are intended to demonstrate efficientenergy use toward the realization of a low-carbon and energy-saving society. By utilizing technology cultivatedthrough the Internet and telematics services mentioned above, Toyota developed the Toyota Smart Center(“TSC”) that optimally controls electricity and links EV (electric vehicles) and PHV (plug-in hybrid vehicles)with homes, and conducted a demonstration project in Rokkasho Village in Aomori aimed at reducing overall
CO2 emissions and users’ electricity costs. In addition, in order to develop a global platform of the TSC, Toyota
announced a partnership with Microsoft Corp. in April 2011 and a partnership with Salesforce.com in May 2011.
Toyota plans to utilize the cloud technology of these two companies in its Internet and telematics services tobuild a framework for TSC’s global implementation. In January 2012, Toyota began eConnect and “TOYOTA
friend” services for PHV. In May 2013, Toyota utilized the latest version of Microsoft’s SharePoint tocomprehensively redesign GAZOO, the automobile information portal site. Toyota aims to offer new services,achieve better vehicle quality and enhance product attractiveness as well as contribute further to society by
utilizing the vehicle information, road conditions and other parameters collected via telematics services andstored at the TSC. With regard to contribution to society, Toyota began offering the Big Data Traffic Information
Service in June 2013, through which traffic information, statistics and other related information are provided to
local governments, universities and businesses to support traffic flow improvement and assist disaster prevention
measures. Toyota plans to continue to work with new information technologies and the IT industry to establish aframework for TSC’s global implementation and to realize a mobility society of the future.

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Enhancing Vehicle Functionality — Driving Assistance Functions
Toyota’s driving assistance functions offer functions that assist drivers with an aim to lessen the burden ofdriving, enhance safety and provide to everyone the pleasure of driving. Toyota has commercializedenhancements to various functions that assist the driver in sensing external information, avoiding danger andmaking appropriate maneuvers. Examples of driving assistance functions include the following:•

VDIM (Vehicle Dynamics Integrated Management) is a system that constantly monitors the driver’s
operations and the vehicle’s situation and centrally manages the engine, steering mechanisms andbrakes. By stabilizing the vehicle before the driver loses control of the vehicle, VDIM achieves a highlevel of ‘active safety’ and improves driving performance, consisting namely of running, turning andstopping.

•“Pre-collision System” is a system that perceives possibilities of a crash with obstacles, cars in front or
crossing pedestrians through a sensor installed in a vehicle. If a collision seems likely, it proceeds toactivate warnings as well as brake assistance, which aids the driver’s operation of the brake, or the
automatic braking system, which aids in avoiding the collision altogether or mitigates any damage.

•“Radar Cruise Control (with all-speed tracking function)” allows the vehicle to keep a constant distance
between itself and the preceding vehicle within a speed range from zero to a preset speed, automaticallyslowing down and stopping if necessary to avoid collision. When the car in front speeds up, it allows thedriver to accelerate.

•“Lane Departure Alert” is a system that uses a camera to detect white or yellow lane markers whiledriving. The system warns the driver with a buzzer and displays if it detects possible deviation in order
to assist in avoiding a collision accident resulting from deviation. In addition, “Lane Keeping Assist
System,” a system that assists the driver’s operation of the steering wheel with electric power steering inorder to help keep the vehicle traveling between lane markers, has also been developed.

•“Automatic High Beam” detects the headlights of oncoming vehicles or taillights of vehicles running infront and adjusts the headlight range, automatically switching to low beam or high beam, in order toavoid dazzling the visions of the drivers with bright lights, as well as to secure the drivers’ forward
visions at night.

•“Blind Spot Monitor” is a system which aims to reduce accidents by alerting the driver to other vehicles
in the driver’s blind spot diagonally behind the driver’s seat with sound and visual display in the side
mirrors while changing lanes.

From these driving assistance functions, in 2015 Toyota developed the Toyota Safety Sense, a collision
avoidance support package that includes the Pre-collision System, the Lane Departure Alert and the AutomaticHigh Beam. By the end of 2017, Toyota plans to install this package on nearly all models sold in Japan, theUnited States and Europe at an affordable price aimed at widespread adaption.
Enhancing Transport Systems
Enhancing transport systems requires taking a general approach that addresses various factors across a wide
scope that are pertinent not only to vehicles but also roads, people and public transport systems in order to ensuresmooth and efficient movement of people and vehicles and to build a safe transportation environment. In addition
to VICS and ETC (Electronic Toll Collection System), which are already standard in Japan, the “VehicleInfrastructure Cooperative Systems that Support Safety Driving,” which combines cutting edge IT and vehicle
technology, is in development and has begun to be partially implemented.
•

The “ITS Spot Service” commenced in 2009 and corresponding products are available for purchase.
Mainly for use on highways, this service provides drivers with information related to road traffic andsafe driving that is transmitted from road infrastructures to car navigation systems through video andvoice.
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•In the summer of 2011, Toyota introduced products corresponding to the driving safety support system(“DSSS”) which the National Police Agency has started operating. Mainly for use on normal roads, thissystem supports safe driving, including by preventing the driver from overlooking red lights, bytransmitting traffic control information (such as traffic lights and signs) and other local informationfrom road infrastructures to automobiles.

•

Systems aimed at further reducing accidents, improving fuel efficiency and reducing CO2 emissions are
in development. Through direct and continuous exchange of information between vehicles and the road,other vehicles and pedestrians, these systems aim to mitigate side collisions and accidents involving
pedestrians, which have been difficult to mitigate to date. This also includes systems such as C-ACC(Co-operative Adaptive Cruise Control) which supports fuel efficient driving and smooth accelerationand deceleration when following behind another vehicle.

Toyota is committed to developing new ITS products. Toyota believes that intelligent transport systems will
become an integral part of its overall automotive operations and enhance the competitiveness of its vehicles. As
familiarity with and demand for ITS products grow, Toyota expects an increasing number of ITS products tobecome commercially available and achieve greater acceptance each year.
Smart Communities
In April 2010, Toyota City was selected as a “Model Region for Next-Generation Energy Systems” by the
Ministry of Economy, Trade and Industry. Toyota has since joined the “Toyota City Low-Carbon Society
Verification Council” (established in August 2010), and carried out experiments relating to the “Optimization of
Local Energy Use in Households and Destinations (commercial and public facilities)” and “Establishment of a
System for Low-Carbon Emission Transportation.” In addition, starting in October 2014, Toyota launched anexperimental ultra-compact electric vehicle sharing program in Grenoble, France, together with the city ofGrenoble and local companies, and in Tokyo from April 2015.
In February 2013, Toyota, together with Toyota affiliated companies, established the “F-Grid Ohira, Miyagi
Limited Liability Partnership,” a smart community business which operates the “F-Grid” in the Sendai Hokubu
Industrial Park in the village of Ohira, Miyagi. The Partnership began supplying electricity and heat to partners in
the industrial park in April 2013. This business aims to contribute to “creating a safe and secure community withthe community and the industrial park working as one,” “revitalizing local industry” and “revitalizing thecommunity.” Toyota believes that the elemental technologies developed through these experiments andbusinesses will help in the creation of new systems for society that meet differing social environments andmunicipal needs, not just in Japan but around the world, in both developed and emerging countries, and will playa role in the creation of energy and transportation infrastructure to help spread next-generation eco-cars.
Financial Services
Toyota’s financial services include loan programs and leasing programs for customers and dealers. Toyota
believes that its ability to provide financing to its customers is an important value-added service. In July 2000,
Toyota established a wholly-owned subsidiary, Toyota Financial Services Corporation (“TFSC”), to oversee themanagement of Toyota’s finance companies worldwide, through which Toyota aims to strengthen the overall
competitiveness of its financial business, improve risk management and streamline decision-making processes.
Toyota has expanded its network of financial services, in accordance with its strategy of developing auto-related
financing businesses in significant markets. Accordingly, Toyota currently operates financial services companies
in 35 countries and regions, which support its automotive operations globally.
Toyota’s revenues from its financial services operations were ¥1,661.1 billion in fiscal 2015, ¥1,421.0 billion
in fiscal 2014 and ¥1,170.6 billion in fiscal 2013. In fiscal 2014, amid a gradual recovery in markets including theUnited States, Europe and Japan, Toyota collaborated with dealers in various countries and regions, and the balanceof loan receivables increased steadily. In fiscal 2015, with recovery in markets particularly in the United States andas a result of the continued collaboration with dealers in various countries and regions and efforts to expand
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products and services that meet customer needs, Toyota’s share of financing provided for new car sales of Toyota
and Lexus vehicles in regions where TFSC operates remained at a high level of 36% and the balance of loan
receivables, mainly in the United States and Thailand, continued to increase steadily. Meanwhile, Toyota is making
efforts to provide both its customers and dealers with stable financial services by diversifying its funding
mechanisms with ABCP (Asset Backed Commercial Paper) and ABS (Asset Backed Securities), in addition to midto long-term financings, primarily in commercial paper issuances, corporate bonds and bank borrowings. Toyota
continued to perform detailed credit appraisals and serve customers by monitoring bad debt and loan payment
extensions, and the percentage of credit losses remained low, at 0.31% and 0.28% in fiscal years 2015 and 2014,
respectively. Toyota continues to work towards improving its risk management measures in connection with credit
and residual value risks.
Toyota Motor Credit Corporation is Toyota’s principal financial services subsidiary in the United States.
Toyota also provides financial services in 34 other countries and regions through various financial services
subsidiaries, including:•

Toyota Finance Corporation in Japan;•

Toyota Credit Canada Inc. in Canada;•

Toyota Finance Australia Ltd. in Australia;•

Toyota Kreditbank GmbH in Germany;•

Toyota Financial Services (UK) PLC in the United Kingdom;•

Toyota Leasing (Thailand) Co., Ltd. in Thailand; and•Toyota Motor Finance (China) Co., Ltd. in China.

Toyota Motor Credit Corporation provides a wide range of financial services, including retail financing,retail leasing, wholesale financing and insurance. Toyota Finance Corporation also provides a range of financial
services, including retail financing, retail leasing and credit cards. Toyota’s other finance subsidiaries provide
services including retail financing, retail leasing and wholesale financing.
In May 2011, Toyota established Toyota Financial Services India Limited, a financial services company, inIndia. Toyota Financial Services India Limited began its operations in June 2012 and has since expanded its
business to major cities such as Bangalore, Delhi and Mumbai. In January 2013, Toyota established a newleasing company, Toyota Motor Leasing (China) Co., Ltd., in China, which began its operations in April 2013. In
addition, in April 2013, Toyota established Toyota Financial Services Kazakhstan MFO LLP, a financial services
company, in Kazakhstan, which began its operations in January 2014.
Net finance receivables for all of Toyota’s dealer and customer financing operations were ¥15,472.3 billion
as of March 31, 2015, representing an increase of approximately 12.7% as compared to the previous year. The
majority of Toyota’s financial services are provided in North America. As of March 31, 2015, 59.3% of Toyota’s
finance receivables were derived from financing operations in North America, 12.8% from Asia, 9.5% from
Europe, 7.9% from Japan and 10.5% from other areas.
Approximately 50% of Toyota’s unit sales in the United States during fiscal 2015 included a finance orlease arrangement with Toyota. Because the majority of Toyota’s financial services operations are related to thesale of Toyota vehicles, a decrease in vehicle unit sales may lead to a contraction of Toyota’s financial services
operations.
The worldwide financial services market is highly competitive. Toyota’s competitors in retail financing andretail leasing include commercial banks, credit unions and other finance companies. Commercial banks and otherautomobile finance subsidiary companies serving their parent automobile companies are competitors of Toyota’s
wholesale financing activities. Competitors in Toyota’s insurance operations are primarily national and regional
insurance companies.
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For information on Toyota’s finance receivables and operating leases, please see “Operating and Financial
Review and Prospects — Operating Results — Financial Services Operations.”
Retail Financing
Toyota’s finance subsidiaries acquire new and used vehicle installment contracts primarily from Toyota
dealers. Installment contracts acquired must first meet specified credit standards. Thereafter, the financecompany retains responsibility for installment payment collections and administration. Toyota’s financesubsidiaries acquire security interests in the vehicles financed and can generally repossess vehicles if customers
fail to meet their contractual obligations. Almost all retail financings are non-recourse, which relieves the dealers
from financial responsibility in the event of repossession. In most cases, Toyota’s finance subsidiaries require
their retail financing customers to carry automobile insurance on financed vehicles covering the interests of boththe finance company and the customer.
Toyota has historically sponsored, and continues to sponsor, special lease and retail programs by subsidizing
below market lease and retail contract rates.
Retail Leasing
In the area of retail leasing, Toyota’s finance subsidiaries acquire new vehicle lease contracts originatedprimarily through Toyota dealers. Lease contracts acquired must first meet specified credit standards after which
the finance company assumes ownership of the leased vehicle. The finance company is generally permitted totake possession of the vehicle upon a default by the lessee. Toyota’s finance subsidiaries are responsible forcontract collection and administration during the lease period. The residual value is normally estimated at thetime the vehicle is first leased. Vehicles returned to the finance subsidiaries at the end of their leases are sold byauction. For example, in the United States, vehicles are sold through a network of auction sites as well as throughthe Internet. In most cases, Toyota’s finance subsidiaries require lessees to carry automobile insurance on leased
vehicles covering the interests of both the finance company and the lessee.
Wholesale Financing
Toyota’s finance subsidiaries also provide wholesale financing primarily to qualified Toyota vehicle dealers
to finance inventories of new Toyota vehicles and used vehicles of Toyota and others. The finance companies
acquire security interests in vehicles financed at wholesale. In cases where additional security interests would be
required, the finance companies take dealership assets or personal assets, or both, as additional security. If adealer defaults, the finance companies have the right to liquidate any assets acquired and seek legal remedies.
Toyota’s finance subsidiaries also make term loans to dealers for business acquisitions, facilities
refurbishment, real estate purchases and working capital requirements. These loans are typically secured withliens on real estate, other dealership assets and/or personal assets of the dealers.
Insurance
Toyota provides insurance services in the United States through Toyota Motor Credit Corporation’s whollyowned subsidiary, Toyota Motor Insurance Services, Inc. (“TMIS”) and its wholly-owned insurance company
subsidiaries. Their principal activities include marketing, underwriting and claims administration. TMIS also
provides coverage related to vehicle service agreements and contractual liability agreements through Toyota
dealers to customers. In addition, TMIS also provides coverage and related administrative services to affiliatedcompanies of Toyota Motor Credit Corporation. Toyota dealers in Japan and in other countries and regions also
engage in vehicle insurance sales.

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Other Financial Services
Toyota Finance Corporation launched its credit card business in April 2001 and began issuing Lexus credit
cards in 2005 when the Lexus brand was introduced in Japan. As of March 31, 2015, Toyota Finance Corporationhas 13.5 million card holders (including Lexus credit card holders).
All Other Operations
In addition to its automotive operations and financial services operations, Toyota is involved in a number ofother non-automotive business activities. Net sales for these activities totaled ¥1,255.7 billion in fiscal 2015,¥1,151.2 billion in fiscal 2014 and ¥1,066.4 billion in fiscal 2013. Sales to external customers of all otheroperations in fiscal 2015 represented 2.2% of Toyota’s net revenues for fiscal 2015. Substantially all of Toyota’s
revenues from other operations were derived in Japan.
Housing
Toyota established its subsidiary Toyota Housing Corporation in April 2003 and has transferred to it productplanning and sales operations related to the manufacture and sale of housing. Furthermore, in order to quickly
and accurately grasp clients’ needs and to plan, develop and sell products on a timely basis, in April 2008,
Toyota transferred the product development operation to Toyota Housing Corporation. In October 2010, Toyota
spun-off its housing operations (project planning, technology development and manufacturing) through astatutory demerger and integrated them into Toyota Housing Corporation. Toyota believes that in the vastly
changing housing market environment, the integration of the development, manufacture and sales functions will
expedite decision making and lead to flexible business operations that will enable Toyota to better respond to theneeds of even more customers. In March 2005, Toyota, together with institutional investors, agreed to jointly
invest in Misawa Home Holdings, Inc. (“Misawa”; renamed Misawa Homes Co., Ltd.) pursuant to its request forassistance in its rehabilitation. In April 2010, determining that a stronger collaboration with Misawa would bedesirable in order to achieve further growth in the difficult operating environment of the housing industry,
Toyota Housing Corporation agreed to purchase Misawa shares from an institutional investor. In addition,
Toyota transferred ownership of Misawa to Toyota Housing Corporation in October 2010. Through these
activities, Toyota has strengthened the housing business of both companies.
Information Technology
See “— Enhancing Vehicle Functionality and Intelligent Transport Systems” for a description of Toyota’s
information technology.
Governmental Regulation, Environmental and Safety Standards
Toyota is subject to laws in various jurisdictions regulating the levels of pollutants generated by its plants.
In addition, Toyota is subject to regulations relating to the emission levels, fuel economy, noise and safety of its
products. Toyota has incurred significant costs in complying with these laws and regulations and expects to incur
significant compliance costs in the future. Toyota’s management views leadership in environmental protection as
an important competitive factor in the marketplace.
Vehicle Emissions
Japanese Standards
The Air Pollution Control Law of Japan and the Road Vehicle Law and the Law Concerning Special
Measures for Total Emission Reduction of Nitrogen Oxides from Automobiles in Specified Areas regulate
vehicle emissions in Japan. In addition, both the Noise Regulation Law and the Road Vehicles Law provide fornoise reduction standards on automobiles in Japan. Toyota’s vehicles manufactured for sale in Japan comply with
all Japanese exhaust emission and noise level standards.
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U.S. Federal Standards
The federal Clean Air Act directs the Environmental Protection Agency (“EPA”) to establish and enforce air
quality standards, including emission control standards on passenger cars, light trucks and heavy-duty vehicles.
The EPA decided in February 2000 to adopt more stringent vehicle emission and fuel economy standards
applicable to passenger cars and light trucks produced in model years 2004 and beyond. In the standards adopted
for model years 2004 and beyond, manufacturers must guarantee that their vehicles meet the requirements forten years or 120 thousand miles, whichever occurs first. Manufacturers are not permitted to sell vehicles in the
United States that do not meet the standards. In April 2007, EPA regulations that further restrict emissions frompassenger cars and light trucks operating at cold temperatures became effective. The new emission standards set
by these regulations were phased in between 2010 and 2013. Similar standards that further restrict emissions
from heavy-duty vehicles operating at cold temperatures have been phased in from 2012 to 2015. In March 2014,
the EPA finalized new vehicle emission and fuel standards for passenger vehicles and light-duty trucks for modelyears 2017 and onwards. Under the new standards, emission standards for volatile organic compounds andnitrogen oxides are to be strengthened in phases from 2017 to 2025, bringing the emission standards in line withemission standards in California, resulting in the unification of the differing California and federal emission
standards. In addition, the particulate matter standards and fuel vapor emission standards will also be
strengthened to be brought in line with California’s emission standards. This is expected to lead to reductions in
the burden on development, such as a reduction in the number of tests required for certification andstandardization of emission reduction systems.
Furthermore, in April 2007 the U.S. Supreme Court ruled that the EPA has the authority to regulate
automobile emissions of greenhouse gases. In response to this ruling, on April 1, 2010 the EPA and the federal
National Highway Traffic Safety Administration (“NHTSA”) issued a joint final rule to reduce the emission ofgreenhouse gases from passenger cars, light-duty trucks and medium-duty passenger vehicles for model years
2012 through 2016. These vehicles are required to meet an estimated combined average emissions level of
250 grams of carbon dioxide per mile, equivalent to 35.5 miles per gallon if the requirements were met throughfuel economy standards. The NHTSA also set Corporate Average Fuel Economy (“CAFE”) standards forpassenger cars and light trucks that will require manufacturers of those vehicles to meet an estimated combined
average fuel economy level of 34.1 miles per gallon in model year 2016. In addition, on August 28, 2012, the
EPA and the NHTSA jointly issued the final rule to further reduce greenhouse gas emissions and improve fueleconomy for passenger vehicles, light-duty trucks and medium-duty passenger vehicles for model years 2017
through 2025. In the final rule, these vehicles are required to meet an estimated combined average emission levelof 163 grams of carbon dioxide per mile in model year 2025, equivalent to 54.5 miles per gallon if theserequirements were met through improvements in fuel economy standards. The NHTSA also issued CAFE
standards for passenger vehicles and light trucks that would require manufacturers to meet an estimatedcombined average fuel economy level of 49.6 miles per gallon in model year 2025. According to the final rule,these standards are to be reevaluated by 2018.
In addition, in August 2014, the EPA proposed to limit, due to related greenhouse gas emissions, the use ofvarious hydroflourocarbons (HFCs) and HFC-containing refrigerant blends used in motor vehicle air
conditioning systems for new vehicles, among other applications. Toyota purchases air conditioning systems
from third parties for use in its vehicles. The proposed rule would list HFC-134a, the most dominant refrigerant
used in light-duty vehicles worldwide, as unacceptable for use in motor vehicle air conditioning systems in newlight-duty vehicles beginning in model year 2021. The proposed rule also lists additional refrigerant blends as
unacceptable for use in new light-duty vehicles beginning in model year 2017. Feasible alternatives to theserefrigerants that the proposed rule, if finalized, would prohibit may be costly or present other risks, such as
flammability or other safety concerns. The potential impacts of this proposed rule to Toyota are unclear at thistime.
As discussed above, the EPA has been granted the authority to set fuel standards in connection with theregulation of automobile emissions. In October 2010, the EPA approved the sale and use of fuel with a 15%
ethanol blend (“E15”) for model years 2007 and later passenger vehicles and light-duty trucks. The use of E15 is33

not permitted for engines used in lawnmowers, small generators, motorbikes, boats and other vehicles andequipment. Subsequently, in February 2011, the EPA approved the use of E15 for model years 2001 and latervehicles. The Alliance of Automobile Manufacturers (“The Alliance”), of which Toyota Motor North America isa member, has stated that current vehicles are only guaranteed to function on fuel up to 10% ethanol and the
EPA’s permission is invalid. The Alliance created the Engine Products Group together with the Global
Automakers, the National Marine Manufacturers Association and the Outdoor Power Equipment Institute, and in
December 2010 the Engine Products Group brought suit against the EPA. The lawsuit was dismissed in
January 2013 on the grounds that the Engine Products Group lacked standing and in March 2013, the Engine
Products Group appealed the decision to the Supreme Court of the United States. The appeal was dismissed on
the same grounds in July 2013, and the EPA approval became effective. The use of E15 is only permitted forcertain 2001 model year or newer vehicles, such as light-duty passenger vehicles and small trucks, and E15 isprohibited for use in other 2000 model year or older vehicles and general purpose engines. As a result, the EPA
promulgated regulations in July 2011, effective August 2011, requiring businesses that sell E15 to put a warninglabel regarding E15 on gasoline fuel dispensers. The Engine Products Group brought suit against the EPA infederal appeals court in 2013 challenging such regulations, but the lawsuit was dismissed in October 2014 on the
ground that the Engine Products Group lacked standing.
California Standards
Under the federal Clean Air Act, the State of California is permitted to establish its own vehicle emission
control standards if it receives a waiver from the EPA. As a result, the California Air Resources Board (“CARB”)
established the Low Emission Vehicle Program and set emission standards for certain regulated pollutants thatwere phased in beginning in the 2004 model year. Under these standards, most light trucks and passenger cars are
required to meet the same emission standards, which were stricter than the federal standards. As part of theoriginal Low Emission Vehicle Program, the CARB also required that a specified percentage of a manufacturer’s
passenger cars and light trucks sold in California for all model years 1998 and after be “zero-emission vehicles”(vehicles producing no emissions of regulated pollutants). The CARB subsequently eliminated the zero-emission
vehicles mandate for model years before 2005, and decided to adopt a zero-emission vehicles requirement formodel years 2005 and beyond. This zero-emission vehicles requirement also permitted certain advanced
technology vehicles such as PHV (Plug-in Hybrid Vehicles), hybrid cars and alternative fuel vehicles that meet“partial zero-emission vehicles requirements” to be granted partial qualification as EV (Electronic Vehicles) or
FCV (Fuel Cell Vehicle). Toyota’s battery-powered RAV4 EV compact sport-utility vehicle and the Toyota
FCHV qualify as zero-emission vehicles. The current Prius plug-in hybrid, Prius and the Camry Hybrid qualify
as partial zero-emission vehicles under the zero-emission vehicles requirement adopted by the CARB. Toyota
intends to continue to develop additional advanced technologies and alternative fuel technologies that will allow
other vehicles using such technologies to qualify as zero-emission vehicles or partial-zero-emission vehicles.
In July 2002, the California legislature passed legislation that required the CARB to develop and adopt, by
the end of 2004, regulations that achieved the maximum feasible reduction in greenhouse gas emissions fromvehicles. In September 2004, the CARB adopted regulations that required a 20 to 30 percent reduction ofgreenhouse gas emissions from passenger vehicles, light trucks and other noncommercial vehicles to be phasedin between the 2009 and 2016 model years.
In December 2007, the EPA denied California’s request for a waiver under the Clean Air Act that would
have allowed the state to enforce these regulations to control greenhouse gas emissions from motor vehicles.
However, the EPA reconsidered its decision pursuant to a direction issued by the U.S. President in January 2009,and in July 2009 decided to allow the state to enforce such regulations.
In February 2010, the CARB enacted regulations that deem automobile manufacturers that produced
vehicles in model years 2012 through 2016 that are in compliance with the greenhouse gas emissions regulationsof the EPA to be in compliance with California’s greenhouse gas emissions regulations. Toyota is currently
developing plans to comply with the EPA regulations.
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In January 2012, the CARB approved a new emission control program for model years 2017 to 2025 called
Advanced Clean Cars. The program covers greenhouse gas standards for cars and light trucks, reductions ofsmog-forming emissions, zero-emission vehicles regulations and clean fuels outlet regulations. The CARB is in
the process of developing and implementing specific rules for the program.
Other States’ Standards
The states of New York, Massachusetts, Connecticut, Maine, Maryland, New Jersey, New Mexico, Oregon,
Rhode Island, Vermont and Colorado have either adopted, or plan to adopt, regulations substantially similar to
California’s zero-emission vehicles requirement. With regard to greenhouse gas emissions regulations, inaddition to these states, Pennsylvania and Washington have also adopted California’s regulations.
Canadian Standards
Canada has established vehicle emission standards equivalent to the federal standards in the United States,
including the heightened requirements that became applicable to passenger cars and light trucks in model years
2004 and beyond. In addition, in response to the strengthening of the federal greenhouse gas emission standards
in the United States applicable to model years 2017 to 2025, Canada finalized equivalent standards in
October 2014. Furthermore, certain Canadian provinces are currently considering enacting their own regulations
on vehicle emissions of greenhouse gases. Canada has also proposed more stringent fuel legislation, which isbased on fuel legislation in the United States, that reduces refineries’ annual average sulfur concentration ofgasoline to 10 ppm from 2017 with a new addition of credit system to secure compliance.
European Standards
The European Union adopted a directive that establishes increasingly stringent emission standards forpassenger vehicles and light commercial vehicles in October 1998. Under this directive, the standards adopted
beginning with year 2000 require manufacturers to recall any vehicles which fail to meet the standards forfive years or 80 thousand kilometers, whichever occurs first. Toyota introduced vehicles complying with thisdirective in 1999. Under standards adopted in 2005, manufacturers are obligated to meet the more stringent
standards for five years or total vehicle miles of 100 thousand kilometers, whichever occurs first. In 2007, theEuropean Parliament adopted more stringent emission standards for passenger vehicles and light commercial
vehicles. The effective dates for phasing in these stricter standards for passenger cars were September 2009 forEuro 5 and September 2014 for Euro 6. For light commercial vehicles, the effective dates are September 2010 forEuro 5 and September 2015 for Euro 6. Euro 5 provides for lower emission levels for gasoline and diesel
powered vehicles and also extends the manufacturers’ responsibility for emission performance to total vehicle
miles of 160 thousand kilometers. The primary focus of Euro 6 is to limit further emissions of diesel powered
vehicles and bring them down to a level equivalent to gasoline powered vehicles. In addition, Euro 6 will be
implemented in two stages, and beginning with the second stage (September 2017 for passenger vehicles and
September 2018 for commercial vehicles), the EU is considering implementing the Real Driving Emission (RDE)
regulations, which regulate emissions under real driving conditions, and the Worldwide harmonized Light
vehicles Test Procedure (WLTP).
Chinese Standards
Emissions regulations are being implemented throughout China pursuant to the Chinese National Standards(GB) of the Ministry of Environmental Protection of the People’s Republic of China, and the manufacture andsale of models not meeting these regulations are prohibited.
For passenger vehicles, pursuant to GB18352.3-2005, Level 3 Emissions Regulations (corresponding toEuro 3 standards) apply to new models after July 2007 and Level 4 Emissions Regulations (corresponding toEuro 4 standards) apply to new models after July 2010. New models after July 2008 are also required to be35

equipped with on-board diagnostics. With respect to passenger vehicles, pursuant to GB18352.5-2013, Level 5
Emissions Regulations (corresponding to Euro 5 standards) are to be implemented throughout China for allmodels that are sold and registered after January 2018.
For diesel-powered commercial vehicles, pursuant to GB17691-2005, new Level 3 Emissions Regulations
apply to models after January 2007. Although Level 4 Emissions Regulations were to apply to new models afterJanuary 2010, and Level 5 Emissions Regulations were to apply to new models after January 2012, because theinfrastructure to supply sufficient diesel fuel meeting the Level 4 quality standards had yet to be put in place, theimplementation of the Level 4 Emissions Regulations for all models was postponed to July 2013. In connection
with such delay, the implementation of the Level 5 Emissions Regulations has been postponed. For gasolinepowered commercial vehicles, pursuant to GB14762-2008, Level 3 Emissions Regulations apply to new models
after July 2009 and Level 4 Emissions Regulations apply to new models after July 2012. After the first day theregulation is implemented to a new model, all new models released during the following one-year period also
become subject to the regulation. In addition, in some areas such as Beijing, Shanghai, Guangzhou and the Pearl
River Delta region, the above mentioned regulations were implemented several years earlier by regional
environmental preservation authorities with the authorization of the Chinese State Council. Cities with serious air
pollution are increasingly exhibiting tendencies to similarly implement Level 5 Emissions Regulations inadvance of the rest of China.
China will also start implementing stricter diesel and gasoline fuel standards a year earlier than scheduled toreduce vehicle emissions, pursuant to GB19147-2013 and GB17930-2013. The new Level 5 standards(equivalent to Euro 5 standards) will be implemented in 11 provinces in eastern China in January 2016, and are
now planned to be implemented nationwide in January 2017, as opposed to the previously announced
January 2018 implementation date.
Compliance with new and more stringent emissions and fuel standards will present significant technologicalchallenges to automobile manufacturers and will likely require significant expenditures. Examples of thesechallenges include the development of advanced technologies, such as high performance batteries and catalytic
converters, as well as the development of alternative fuel technologies. Manufacturers that are unable to develop
commercially viable technologies within the time frames set by the new standards will lose their market shareand will be forced to decrease the number of types of vehicles and engines in their principal markets.
Standards of Other Countries
Countries other than Japan, the United States, Europe and China are also proactively introducing emissions
regulations. Countries in Eastern Europe and Asia, as well as Australia, Mexico, Taiwan and Hong Kong, haveconsidered or implemented emissions regulations.
Vehicle Fuel Economy
Japanese Standards
The Law Concerning the Rational Use of Energy requires automobile manufacturers to improve theirvehicles to meet specified fuel economy standards. Fuel economy standards are established according to thetypes of vehicles specified below, and are required to be met by either fiscal 2011 (April 2010-March 2011),
fiscal 2016 (April 2015-March 2016), fiscal 2021 (April 2020-March 2021) or fiscal 2023 (April 2022March 2023).
Among qualifying passenger vehicles are:•Vehicles which are designated in Article 75, Paragraph 1 of the Road Vehicles Law as type-designatedvehicles (“type-designated vehicles”) with 10 seats or less using gasoline, gas oil or LPG;•

Type-designated vehicles with 11 seats or more that are 3.5 tons or less in vehicle weight using gasoline
or gas oil; and36•Type-designated vehicles with 11 seats or more that are over 3.5 tons in vehicle weight using gas oil, or
designated carbon monoxide emission control vehicles (“designated carbon monoxide emission control
vehicles”) which are designated in Article 75-2 Paragraph 1 of the Road Vehicles Law.

Among qualifying cargo vehicles are:•Type-designated vehicles that are 3.5 tons or less in vehicle weight using gasoline, gas oil or LPG; and•Type-designated vehicles that are over 3.5 tons in vehicle weight using gas oil or LPG, or designatedcarbon monoxide emission control vehicles.

Toyota is in compliance with the fuel economy standards that currently apply and is promoting theimprovement of its vehicles in order to achieve compliance with the standards that will apply beginning in fiscal
2016.
Japan is a signatory to the Framework Convention on Climate Change and has agreed to take measures toreduce its greenhouse gas emissions. Improved vehicle fuel economy is contributing to the reduction in carbon
dioxide emissions.
U.S. Standards
The Federal Motor Vehicle Information and Cost Savings Act requires automobile manufacturers to comply
with CAFE standards. Under this law, limits are imposed on the amount of regulated pollutants that may beemitted by new motor vehicles in the United States. A manufacturer is subject to substantial civil penalties if, in
any model year, its vehicles do not meet the CAFE standards. Manufacturers that exceed the CAFE standards
earn credits determined by the difference between the average fuel economy performance of their vehicles andthe CAFE standards. Credits earned for the five model years preceding the current model year, and credits
projected to be earned for the next three model years, can be used to meet CAFE standards in a current modelyear.
In April 2006, the NHTSA established CAFE standards applicable to light trucks for model year 2008 andbeyond. These CAFE standards aimed at shifting the framework from one that used to be advantageous only tocompact car manufacturers to one that is fair to full line manufacturers. The requirements were changed so that
the CAFE standards are now determined by a sales rate based on vehicle size (measured by the area of the wheel
and wheel base) for each manufacturer.
In addition to the CAFE standards, there are multiple standards in the United States, including the EPA’semissions regulations and the California standard. Automobile manufacturers had called for uniform standards,
as they would need to comply with standards that varied by state if all standards became effective. On April 1,
2010, the EPA and the NHTSA issued a joint final rule to reduce the emission of greenhouse gases frompassenger cars, light-duty trucks and medium-duty passenger vehicles for model years 2012 through 2016. Thesevehicles are required to meet an estimated combined average emissions level of 250 grams of carbon dioxide permile, equivalent to 35.5 miles per gallon if the requirements were met through fuel economy standards. The
NHTSA also set CAFE standards for passenger cars and light trucks that will require manufacturers of thosevehicles to meet an estimated combined average fuel economy level of 34.1 miles per gallon in model year 2016.
Furthermore, the EPA and the NHTSA joint final rule allows the two agencies and California standards to act ina unified way, and creates a regulatory framework that makes compliance less burdensome for the
manufacturers. In addition, in December 2011, the EPA and the NHTSA issued a joint proposed rule to further
reduce greenhouse gas emissions and improve fuel economy for passenger vehicles, light-duty trucks andmedium-duty passenger vehicles for model years 2017 through 2025. In the rule, which was finalized inAugust 2012, these vehicles are required to meet an estimated combined average emission level of 163 grams ofcarbon dioxide per mile in model year 2025, equivalent to 54.5 miles per gallon if these requirements are met
through improvements in fuel economy standards. At the same time, the NHTSA also issued CAFE standards for37

passenger vehicles and light trucks that would require manufacturers to meet an estimated combined average fueleconomy level of 49.6 miles per gallon in model year 2025. The standards of fuel economy are stringent, andToyota strives to meet the fuel economy standards by further developing fuel-efficient technology, alternativefuel technology and other advanced technology.
In addition, the Energy Tax Act of 1978 imposes a “gas guzzler” tax on automobiles with a fuel economy
rating below specified levels.
European Standards
The European Union has signed the Kyoto Protocol and agreed to reduce carbon dioxide emissions by 8%during the years 2008 to 2012, as measured from the 1990 base year. In early 1999, the European Commission
and the European Automotive Manufacturers Association (“ACEA”) reached a voluntary agreement which
establishes an average emissions target of 140 grams of carbon dioxide per kilometer for new cars sold in the EU
in 2008 (the voluntary agreement applied to the 15 states who were members of the EU at that time). The Japan
Automobile Manufacturers Association and the Korean Automobile Manufacturers Association have alsoreached a voluntary agreement, similar to that entered into by the European Commission, with the year 2009 as atarget year.
In December 2008, the European Parliament approved a new regulation that establishes an average emission
standard of 130 grams of carbon dioxide per kilometer by 2012 for passenger vehicles sold in member states,
made effective in June 2009. The regulation has been phased in gradually, initially requiring 65% of new cars tocomply with the new standards in 2012 and increasing to 100% of new cars in 2015. As a result of the new
regulations, different targets will apply to each manufacturer, based on their respective fleets of vehicles andweight. Penalties will apply to those manufacturers who fail to meet their targets from 2012, in amounts
corresponding to the degree of shortfall. Manufacturers failing to meet their targets between 2012 and 2018 will
incur penalties of between €5 and €95 per each gram of carbon dioxide per kilometer shortfall for each noncompliant vehicle, and such penalties will rise to €95 in 2019 and beyond. Furthermore, in June 2011, a newcarbon dioxide emission standard applicable to light commercial vehicles entered into force establishing an
average emissions target of 175 grams of carbon dioxide per kilometer. This regulation has the same basic
regulatory framework as passenger vehicles, raising the compliance rate from 70% in 2014 to 100% in 2017.
Furthermore, in February 2014, the European Parliament and Council adopted a regulation to reduce theaverage carbon dioxide emissions target for light commercial vehicles to 147 grams per kilometer beginning in
2020. In March 2014, the European Parliament and Council adopted a regulation to reduce the average carbon
dioxide emissions target for passenger vehicles to 95 grams per kilometer beginning in 2021. The relevant
legislation requests the European Commission to conduct a review by 2015 and, if appropriate, propose newtargets for the period beyond 2020, including possibly setting a 2025 target.
An increasing number of EU member states are introducing vehicle tax laws based on carbon dioxide
emission levels pursuant to the directive issued by the European Commission in 2005. This trend is expected tocontinue in accordance with the recent increases in environmental awareness.
Chinese Standards
Fuel consumption regulations are being implemented pursuant to the Chinese National Standards (“GB”),
and the manufacture and sale of vehicle models not meeting these regulations are prohibited. For passenger
vehicles, pursuant to GB19578-2004, Level 1 Fuel Consumption Regulations apply to new models after
July 2005 and Level 2 Fuel Consumption Regulations apply to new models after January 2008. For small
commercial vehicles, pursuant to GB20997-2007, Level 2 Fuel Consumption Regulations apply to new models
after February 2008, Level 1 Fuel Consumption Regulations apply to all vehicles as of January 2009 andLevel 2 Fuel Consumption Regulations apply to all models as of January 2011. These regulations determine the38consumption standards that apply depending on the mass of the applicable vehicle and set forth a method for
determining whether each model has met the regulation. With respect to passenger vehicles, GB27999-2011 has
been issued to further strengthen fuel consumption regulations from 2012 and beyond. In these Level 3 Fuel
Consumption Regulations for passenger vehicles, the regulation framework was substantially revised, such as achange from regulations requiring each model to meet consumption standards to regulations requiring
automobile manufacturers to meet standards of average consumption across models. Furthermore, in order toachieve the national target for average fuel efficiency for 2020, the following more stringent fuel consumption
regulations have been enacted for passenger cars. First, GB19578-2014, which has been enacted to strengthen
regulations for each model, will be applied to new models after January 2016. Second, GB27999-2014, which
has been enacted to strengthen corporate average regulations, will apply the Level 4 Fuel Consumption
Regulations from 2016.
Standards of Other Countries
As momentum gathers to increase energy security and prevent global warming, other countries in addition
to Japan, the United States, Europe and China are moving to introduce fuel consumption regulations, and Korea,
Mexico, Brazil, Taiwan, India, Saudi Arabia and Canada have already decided to introduce fuel consumption
regulations. Vietnam and some other countries are also actively considering the introduction of new fuelconsumption regulations using the regulations of Japan, Europe and the United States as a base, and may
implement them by approximately 2017. Toyota predicts that this trend will spread to other countries, and in the
future many nations will consider new regulations related to fuel consumption and carbon dioxide.
Vehicle Safety
Japanese Standards
In Japan, efforts have been made since 1998 to bring Japanese standards in line with the regulations of theUnited Nations Economic Commission for Europe (“UN”).
With respect to standards that were previously brought in line with the UN regulations, the Japanesestandards regarding Lane Departure Warning systems (“LDWS”) will additionally require that buses and mediumor heavy trucks be equipped with such systems. LDWS will apply gradually to new models beginning inNovember 2017 and to existing models still in production beginning in November 2019.
With respect to standards that were newly brought in line with the UN regulations, standards for interior
fittings (internal projections) will apply to new models beginning in January 2018 and to existing models still in
production beginning in January 2020. Standards for glass windows will apply to new models beginning inJuly 2017 and to existing models still in production beginning in July 2019. Standards for temporary-use spareunits and tire pressure monitoring systems will apply to vehicles to be manufactured on or after February 2018.
Standards for steering systems will apply gradually to new models beginning in July 2016 and to existing models
still in production beginning in July 2018.
With respect to standards that are scheduled to be newly brought in line with the UN regulations, standards
for fire prevention will apply to new models beginning in September 2018. Standards for protection ofpassengers from pole side impact will apply to new models beginning in June 2020. Standards for illumination ofrear registration plates will apply to vehicles to be manufactured on or after June 2020. Standards for filament
light bulbs will apply to vehicles to be manufactured on or after June 2020. Standards for gas-discharge lightsources will apply to vehicles to be manufactured on or after June 2020. Standards for LED will apply to vehicles
to be manufactured on or after June 2020.
Furthermore, in Japan, considerations regarding the standardization of brake override systems, thestrengthening of anti-spinal injury measures and anti-drunk driving measures are currently under consideration.
39

U.S. Standards
The U.S. National Traffic and Motor Vehicle Safety Act of 1966, or Safety Act, requires vehicles andequipment sold in the United States to meet various safety standards issued by the NHTSA. The Safety Act also
authorizes the NHTSA to investigate complaints relating to vehicle safety and to order manufacturers to recall
and repair vehicles found to have safety-related defects. The cost of these recalls can be substantial depending on
the nature of the repair and the number of vehicles affected.
The Transportation Recall Enhancement, Accountability and Documentation Act was enacted in the
United States on November 1, 2000. This Act required the NHTSA to regulate the dynamic rollover standards
and to upgrade federal motor vehicle safety standards relating to tires. It also required the NHTSA to enhance its
authority to gather information potentially relating to motor vehicle defects. This Act substantially increases the
maximum civil penalties for violation of regulatory requirements and specifies possible criminal penalties forviolations of the federal Fraud and False Statements Act. In 2003, the NHTSA expanded its New Car Assessment
Program (“NCAP”) to implement consumer information programs for vehicle rollover resistance and child
restraints and, beginning in 2003, adopted extensive early warning defect reporting requirements. Regulations
regarding tire-pressure monitoring systems were strengthened in 2005.
Legislation on a transportation budget plan promoting a safe and efficient vehicle safety program fordrivers, the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users(SAFETEA-LU) was passed in August 2005. The legislation requires the NHTSA to propose and issue safety
standards to reduce rollover accidents, to complete the creation of standards for the reduction of vehicle
passengers released from cars at the time of rollover accidents, to upgrade door lock standards, to complete theupgrade of roof crash standards, to decide on the side impact protection standards for passengers in all seat
locations, to review seat belt wearing technology and complete a study that includes a proposal for improving therate of seat belt usage, to establish standards to display NCAP ratings on new car labels and to complete theupgrade of the standard for power windows that will require pulling up switches. Some actions have already beentaken and completed in response to the above requirements.
In February 2008, legislation to prevent non-traffic related injuries to young children caused by vehicles, the“Cameron Gulbransen Kids Transportation Safety Act,” was passed. Pursuant to this legislation, the NHTSA
finalized standards requiring vehicles to be equipped with rearview camera systems in order to ensure rearward
visibility to prevent children from being struck by backing vehicles and mandating the use of brake shiftinterlock systems.
In January 2011, legislation to improve the safety of the visually impaired and other pedestrians, the“Pedestrian Safety Enhancement Act of 2010,” was passed. The legislation requires the NHTSA to draft andfinalize standards for warning sounds of electric and hybrid vehicles. The NHTSA formally proposed minimum
sound standards in January 2013, and the standards are currently in the regulatory review process.
In response to the unintended acceleration issue in 2010, the NHTSA has started to examine and implement
measures to strengthen safety standards, such as mandating brake override systems, mandating Event Data
Recorders, or EDR, and standardizing push-start switches.
In August 2014, the NHTSA initiated rulemaking that would propose to create a new safety standard torequire new passenger and light truck vehicles to have dedicated short-range communication (DSRC) units thatenable Vehicle-to-Vehicle (V2V) communication.
In January 2015, the NHTSA proposed to amend safety standards regarding child restraint anchorage
systems to improve the ease of use, and in March 2015, the NHTSA proposed to amend a safety standard
regarding seat belt assembly anchorages to specify an alternative test procedure.

40

European Standards
In Europe, following the White Paper “European Transport Policy for 2010: Time to Decide” adopted in
2001, which targets halving the number of deaths caused by road accidents by 2010, various groups in different
fields have conducted research and analyses.
The European Commission and the ACEA have established CARS 21, a High Level Group that aims tostrengthen the competitiveness of the European automotive industry, and examined the recommendations withthe legal framework of a decade later in mind. The CARS 21 final report issued at the end of 2005 contains
recommendations relating to the simplification of legislation and road safety, among other issues, and indicates a
Ten Year Roadmap, and in February 2007, the European Commission issued a communication regarding the
CARS 21 final report, in which concrete action plans for future legislation were announced, and much legislation
has already proceeded.
In 2009, based on the CARS 21 final report released in February 2007, the European Commission enacted a
new regulation and established a simplified framework, repealing more than 50 existing European Commission
directives regarding vehicle safety other than pedestrian protection, and replacing them with a single regulation
aimed at incorporating the UN regulations. The new regulation also requires the adoption of advanced safetysystems. The EU Regulation directly incorporating the UN Regulations commenced in 2012 and requires
advanced safety systems, including requiring new type vehicles to have electronic stability control systems from2011, to introduce regulations relating to low rolling resistance tires in 2013, to require tire pressure monitoring
systems starting in 2012 and to require heavy vehicles to have advanced emergency braking systems and lane
departure warning systems from 2013. All of the technical requirements for these advanced safety systems werediscussed in the United Nations (the technical requirements for advanced emergency braking in medium-duty
passenger vehicles are under consideration by the United Nations). Further, application of UN regulation cameinto force from November 2012 for new vehicle types and from 2014 for all new vehicles sold in the EU market.
The new mandatory measures include electric car safety requirements and gear shift indicators.
In October 2010, CARS 21 was resumed in order to proceed with the realization of the “2020 Strategy”(CARS 2020) by the European Commission that aims for high-level, sustainable and comprehensive growth, andthe CARS 21 final report was issued in June 2012. The final report addresses issues facing the widespread
adoption of electric vehicles, including charging infrastructure in the EU, establishing battery requirements,
adopting seat belt reminder devices for all seats, connection of alcohol interlock devices to vehicles, adopting
speed management devices, establishing safety requirements for micro urban mobility, strengthening safety
regulation to protect the vulnerable from collisions and the possibility of regulation in connection withpreventative safety technology. In November 2012, “CARS 2020: Action Plan for a competitive and sustainable
automotive industry in Europe” was issued based on the final report. The action plan is built on four core
concepts, and within these concepts it discusses enhancement of road safety, improving the market conditions
within the EU and the implementation of smart regulations. Each item is given a target date and is to bemonitored going forward. A stakeholder hearing on the implementation of the CARS 2020 action plan took place
in February 2014 in Brussels in preparation for the Commission’s final report, which the Commission publishedin October 2014. The report indicates the direction for future short and medium term actions.
On the widespread adoption of emergency call systems (“eCall”), the European Commission concluded thata legislative approach is effective as a result of the impact assessment by the Commission in 2011. Accordingly,
eCall is expected to become mandatory from the end of March 2018 for light-duty passenger vehicles and lightduty commercial vehicles using the framework of “Whole Vehicle Type Approval.” Amended rules relating to
WVTA are scheduled to take effect. Regulations setting forth the technical standards of eCall have been
proposed, with further revisions possible. Rulemaking regarding eCall has also been proposed by the United
Nations, and is also currently being considered. In addition, in the event the installation of eCall becomesmandatory in the EU, it will be necessary at the same time to build infrastructure such as communication bases inthe different member states of the EU, and rulemaking regarding eCall is expected to also cover the creation ofsuch infrastructure.
41

The possibility of regulation in connection with ITS and other advanced driver assist systems for 2020 andbeyond is also under consideration. In addition, the adoption of Advanced Emergency Breaking systems and lane
departure warning systems on light vehicles, Advanced Emergency Breaking systems which detect pedestrians,
and the adoption of blind spot monitors, reverse system which detect pedestrians, reverse cameras, Evert Data
Recorders on trucks and alcohol interlock devices are also expected to be considered. In March 2015, theEuropean Commission published a final report on the benefit and feasibility of a range of new safety
technologies.
From April 2009, the applicable scope for Whole Vehicle Type Approval (“WVTA”) was extended to cover
all vehicle categories. Furthermore, an amendment was issued in 2011 which clarifies the categories (especiallythose for passenger and light-duty commercial vehicles). Through this amendment, the criteria for light-duty
commercial vehicles was clarified, and there is a possibility that vehicles currently classified as light-duty
commercial vehicles become classified as passenger vehicles. In addition, revisions to EU regulations related tovehicle mass and dimensions were issued in 2012. These revisions clarified the mass, criteria and definitions
which comprise the base specifications for vehicles. In 2015, WVTA is scheduled to be amended for further
enhancement and improvement together with the revision of overall requirements based on a comprehensive
review of the requirements for vehicle structures, including the strengthening of the market surveillance
requirements and general product safety requirements, as well as revisions to the vehicle type definitions.
United Nations Regulations
The 1958 Agreement (“Agreement Concerning the Adoption of Uniform Technical Prescriptions for
Wheeled Vehicles, Equipment and Parts which can be Fitted and/or be Used on Wheeled Vehicles and theConditions for Reciprocal Recognition of Approvals Granted on the Basis of These Prescriptions”) was
originally based on the European regulations, but the UN Regulations are developing as an establishedinternational law, and Japan, Thailand, Malaysia and Egypt as well as other countries outside the EU havebecome members after the amendment in 1995, and many other countries are expected to join in the future. The
countries bound by the 1958 Agreement have incorporated the UN Regulations into their own domestic policies(The EU and Japan have directly included the UN Regulations into their domestic legislations). Whileautomotive parts and vehicle systems are regulated by the UN regulations, there are currently no regulations withrespect to International Whole Vehicle Type Approval (IWVTA) such as those in Europe. Japan proposed
legislation establishing WVTA under the United Nations in 2016, and the matter is being deliberated by theUnited Nations. If IWVTA is established, integration of global approval administrative regulations of eachcountry and simplification of vehicle construction regulations are expected but IWVTA, if finalized, would only
be partially applicable at the time of its establishment in 2016 and deliberation toward the full application would
continue after establishment.
An amendment to the 1958 Agreement is being considered with an aim towards implementation in
March 2016. Such amendment will increase the flexibility of the regulations, enabling approvals to be granted forthe old series of regulations according to the needs of the signatory countries to the 1958 Agreement. The
percentage of required votes for voting in connection with proposed UN regulations will also be considered, andif the percentage of required votes is increased from the current two-thirds, the 1958 Agreement is expected to
become fairer. Such amendment is expected to make the 1958 Agreement more attractive to countries that are notcurrently party to the 1958 Agreement, and aims to increase the number of signatory countries.
The 1998 Agreement (“Agreement Concerning the Establishing of Global Technical Regulations for
Wheeled Vehicles, Equipment and Parts which can be Fitted and/or be Used on Wheeled Vehicles”) is a U.S.-ledagreement that aims to harmonize technical regulations, and defines each regulation as a Global TechnicalRegulation (“GTR”). At present, there are 16 GTRs in total. Currently, numerous provisions are under discussionin order to include more regulations. The countries bound by the 1998 agreement are required to incorporate the
GTRs into their domestic laws. The parties to the 1998 agreement include the United States, Canada, China andIndia, which are not parties to the 1958 agreement, so GTRs will also influence those countries.
42

Chinese Standards
Vehicle safety regulations in China were drafted with reference to the UN regulations and cover almost thesame matters as the UN regulations. However, these regulations also include unique provisions which take into
account the distinctive characteristics of the Chinese market environment and the rules differ from the latest
UN regulations. As for future safety regulations, standards related to airbag technologies and standards related tobatteries, motors and the charging of electric vehicles are currently being planned.
Standards of Other Countries
Vehicle safety regulations in Canada are basically similar to those in the United States. In regions outside ofNorth America, adoption and conformity with the UN regulations is widespread, including in those countries
without automotive manufacturing industries. The list of signatories to the 1958 agreement of the United Nations
continues to grow, and now includes Korea, Thailand and Malaysia in Asia, as well as Russia, South Africa,
Egypt and Morocco. In addition, ASEAN, pursuant to its economic community mission, has decided to adopt the
UN regulations as its regional agreement. Latin America, India and countries in the Middle East that are notsignatories to the 1958 agreement of the United Nations are also moving forward to conform their respective
regulations to the UN regulations or to adopt new regulations consistent with the UN regulations.
Environmental Matters
Japanese Standards
Toyota’s automotive operations in Japan are subject to substantial environmental regulation under laws suchas the Air Pollution Law, the Water Pollution Control Law, the Noise Regulation Law and the Vibration Control
Law. Under these laws, if a business entity establishes or alters any facility that is regulated by these laws, thebusiness entity is required to give prior notice to regulators, and if a business entity discharges, uses or stores
substances that are environmental burdens or causes noise or vibration from such facility, the business entity isalso required to comply with the applicable standards. Toyota is also subject to local regulations, which in somecases impose more stringent obligations than the Japanese central government requirements. Toyota has
complied with these regulations. Under the Waste Disposal and Public Cleaning Law, producers of industrial
waste must dispose of industrial waste in the manner prescribed in the Waste Disposal and Public Cleaning Law.
Toyota has also complied with the Waste Disposal and Public Cleaning Law.
The Soil Contamination Countermeasures Law of Japan requires that land owners conduct contamination
testing and submit a report at the time they cease to use hazardous substances, such as in connection with the saleof a former factory, or if there is a possibility of health hazards due to land contamination. If it is found that land
contamination exceeds a certain level, the relevant prefectural authority designates the area considered to becontaminated and orders the land owner to take necessary measures. Toyota is suitably managing its land inaccordance with the same law. In addition, under the Law on Recycling of End-of-Life Vehicles, vehicle
manufacturers are required to take back and recycle specified materials (automotive shredder residues, air bags
and fluorocarbons) of end-of-life vehicles and the provisions concerning such obligations of vehicle
manufacturers became effective in January 2005. Toyota has coordinated with relevant parties to establish avehicle take-back and recycle system throughout Japan. As a result, in fiscal 2015, Toyota achieved a recycling/
recovery rate of 97% for automobile shredder residue (the legal requirement being 50%) and 94% for air bags
(the legal requirement being 85%) and reached the targets set forth in this law.
U.S. Standards
Toyota’s assembly, manufacturing and other operations in the United States are subject to a wide range ofenvironmental regulation under the Clean Air Act, the Clean Water Act, the Resource Conservation andRecovery Act, the Pollution Prevention Act and the Toxic Substances Control Act. Toyota is also subject to avariety of state legislation that parallels, and in some cases imposes more stringent obligations than, federal
43requirements. These federal and state regulations impose severe restrictions on air- and water-borne discharges ofpollution from Toyota facilities, the handling of hazardous materials at Toyota facilities and the disposal ofwastes from Toyota operations. Toyota is subject to many similar requirements in its operations in Europe,
Canada and other countries.
Pursuant to the Clean Air Act, the EPA has promulgated National Ambient Air Quality Standards(“NAAQS”) for six “criteria” pollutants, including for ozone and particulate matter. The Clean Air Act requiresthat the EPA review and possibly revise these NAAQS every five years. On December 14, 2012, the EPA madethe annual health-based particulate matter NAAQS more stringent, and the EPA is scheduled to complete its
review and possible revision of the ozone NAAQS in 2015. The revised annual health-based particulate matter
NAAQS, as well as any future NAAQS revisions, could lead to additional pollution control requirements on theindustry, including on Toyota’s manufacturing operations.
Toyota expects growing pressure in the next several years to further reduce emissions from motor vehicles
and manufacturing facilities.
European Standards
In October 2000, the European Union brought into effect a directive that requires member states topromulgate regulations implementing the following:•

automotive manufacturers shall bear all or a significant part of the costs for taking back end-of-life
vehicles sold after July 1, 2002 and dismantling and recycling those vehicles. Beginning January 1,
2007, this requirement became applicable to vehicles sold before July 1, 2002 as well;•automotive manufacturers may not use certain hazardous materials in vehicles sold after July 1, 2003;•

certified vehicle models sold after December 15, 2008 shall be re-usable and/or recyclable to aminimum of 85% by weight per vehicle and shall be re-usable and/or re-use as material or energy to aminimum of 95% by weight per vehicle; and•end-of-life vehicles must meet actual re-use and/or recycling of 80% and re-use and/or recovery of 85%,
respectively, of vehicle weight by 2006, rising respectively to 85% and 95% by 2015.

Laws to implement this directive came into effect in each of the EU member states. Currently, there areuncertainties surrounding the implementation of the applicable regulations in different EU member states,
particularly regarding automotive manufacturer responsibilities and resultant expenses that may be incurred.
In addition, under this directive, the member states must take measures to ensure that car manufacturers,
distributors and other auto-related economic operators establish adequate used vehicle collection and treatment
facilities and to ensure that hazardous materials and recyclable parts are removed from vehicles prior toshredding. This directive impacts Toyota’s vehicles sold in the EU. Toyota accommodated, in offering its
products, any measures the EU member states chose to implement in order to comply with this directive.
The EU has also issued directives and made proposals relating to the following subjects on environmental
matters:•

emission standards that include a framework permitting member states to introduce fiscal incentives topromote early compliance; and•reform of rules governing automotive distribution and service. The block exemption on distribution has
been amended so that dealers may engage in cross-border sales actively within the EU and open
additional facilities for sales and services. Additionally, dealers may no longer be required bymanufacturers to operate both sales and service facilities side by side.

44

In December 2011, the European Commission proposed to reduce noise produced by cars, vans, buses,
coaches and light and heavy trucks. As proposed, noise limit values would ultimately be lowered by four
A-weighted decibels for vehicles other than trucks, and three A-weighted decibels for trucks. Compliance would
be achieved in three steps over a 10 to 12 year period. In May 2014, a regulation adopting the proposal was
published in final form in the EU Official Journal.
Toyota believes that its operations are materially in compliance with environmental regulatory requirements
concerning its facilities and products in each of the markets in which it operates. Toyota continuously monitorsthese requirements and takes necessary operational measures to ensure that it remains in material compliancewith all of these requirements.
Toyota believes that environmental regulatory requirements have not had a material adverse effect on its
operations. However, compliance with environmental regulations and standards has increased costs and is
expected to lead to higher costs in the future. Therefore, Toyota recognizes that effective environmental costmanagement will become increasingly important. Moreover, innovation and leadership in the area ofenvironmental protection are becoming increasingly important to remain competitive in the market. As a result,
Toyota has proceeded with the development and production of environmentally friendly technologies, such as
hybrid vehicles, fuel cell vehicles and high fuel efficiency, low emission engines.
In addressing environmental issues, based on an assessment of the environmental impact of its products
through their life cycles, Toyota, as a manufacturer, strives to take all possible measures in each life stage of a
product, from development through production, sales, disposal and recycling, and continues to work toward
technological innovations to make efficient use of resources and to reduce the burden on the environment.
Disclosure of Iranian Activities under Section 13(r) of the Securities Exchange Act of 1934
Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012 added Section 13(r) to the
Securities Exchange Act of 1934, as amended. Section 13(r) requires an issuer to disclose in its annual orquarterly reports, as applicable, whether it or any of its affiliates knowingly engaged in certain activities,
transactions or dealings relating to Iran or with designated natural persons or entities involved in terrorism or the
proliferation of weapons of mass destruction. Pursuant to Section 13(r), Toyota is disclosing the following
information.
During the fiscal year ended March 31, 2015:•

Toyota Tourist International, Inc., a majority-owned subsidiary of Toyota, obtained three visas from the
Iranian embassy in Japan in connection with certain travel arrangements.

•

Tokyo Toyota Motor Co., Ltd., a wholly-owned indirect subsidiary of Toyota, performed maintenanceservices for Toyota vehicles owned by the Iranian embassy in Japan.

Altogether, the above activities contributed an insignificant amount in gross revenues and net profit to
Toyota. Toyota believes that none of the above transactions subject it or its affiliates to U.S. sanctions. Toyota
Tourist International intends to cease conducting the activities described above. Tokyo Toyota Motor may, if
requested by the Iranian embassy in Japan, continue to perform maintenance services relating to vehicles owned
by such embassy, in accordance with applicable laws and regulations, in order to honor Toyota’s commitment tothe safety and reliability of its vehicles.
Research and Development
The overriding goals of Toyota’s technology and product development activities are to minimize thenegative aspects of cars, such as traffic accidents and impact on the environment, and maximize the positive
aspects, such as driving pleasure, comfort and convenience. By achieving these sometimes conflicting goals to a45

high degree, Toyota seeks to open the door to the automobile society of the future. To ensure efficient progress inresearch and development activities, Toyota coordinates and integrates all research and development phases,from basic research and advanced research to forward-looking technology and product development. With
respect to long-term basic research in areas such as energy, the environment, information technology,
telecommunications and materials, projects are regularly reviewed and evaluated in consultation with outside
experts to achieve research and development cost control. With respect to forward-looking, leading-edge
technology and product development, Toyota establishes cost-performance benchmarks on a project-by-projectbasis to ensure efficient development investment.
The chart below provides an overview of Toyota’s R&D at each phase.
Phase

Description

Basic researchPhase to discover development theme
Research on basic vehicle-related technology

Forward-looking andleading-edge technology
development

Phase requiring technological breakthroughs such as components and systems

Product development

Phase mainly for development of new models

Development of leading-edge components and systems that are moreadvanced than those of competitors

Development of all-new models and existing-model upgrades
Toyota is promoting research and development into the early commercialization of next generation
environmentally-friendly, energy-efficient and safe-vehicle technology and is making efforts to produce vehicles
that are friendly to people and the environment by focusing on the following areas:•

further improvements in hybrid technologies, including in functions and cost, and contributions to theenvironment through advancements;•

improvement in gasoline engine fuel economy technology as well as improvement in technology inconnection with more stringent emission standards;•

promoting improvements in functions and fuel economy of clean diesel engines;•

development of electric vehicles, fuel cell vehicles and other alternative fuel vehicles; and•development of technology designed to promote driving and vehicle safety.

For a detailed discussion of the company’s research and development infrastructure, see “Operating and
Financial Review and Prospects — Research and Development, Patents and Licenses”.
Components and Parts, Raw Materials and Sources of Supply
Toyota purchases parts, components, raw materials, equipment and other supplies from multiple competing
suppliers located around the world. Toyota works closely with its suppliers to pursue the most optimalpurchasing possible. Toyota believes that this policy encourages technological innovation, cost reduction andother measures to strengthen its vehicle competitiveness. No single supplier accounted for more than 5% of
Toyota’s consolidated purchases of raw materials and parts during fiscal 2015, except for Denso Corporation, anaffiliated company of Toyota, which supplied approximately 10% of Toyota’s purchases during fiscal 2015.
Toyota plans to continue purchases based on the same principle and does not anticipate any difficulty inobtaining stable supplies in the foreseeable future.
Because Toyota had more than 50 overseas operations in 28 countries and regions as of December 31, 2014,
procurement of parts and components is being carried out not only locally in the country of the production site
but also from third countries, and the distribution network has become increasingly more complex. In order to46

realize timely and efficient distribution at the same time as keeping total costs at a minimum, Toyota is
promoting efforts to optimize each stage of the supply-chain. To this end, Toyota has developed a standardized
system of global distribution and is supporting the operation of the system at each production base. The use of
the global distribution system aims at implementing parts procurement that meets changes in vehicle production
in a timely manner. These varying efforts, combined together, have led to maximized customer satisfaction, as
well as to building a good working relationship with Toyota’s suppliers.
Toyota aims to share information and collaborate among the procurement divisions in each of the regions
throughout the world in order to procure parts and materials from the most competitive suppliers among Toyota
factories located in various areas worldwide. At the same time, Toyota carries out streamlining efforts
undertaken together with suppliers in each country in order to achieve sustainable growth. In particular, Toyota
has been working on a cost reduction measure referred to as RR-CI activities. RR-CI activities aim to improve
competitive power through thorough localization, sharing parts and components and manufacturing reforms
together with producing products matching customers’ needs in each region and vehicle category. Toyota isadvancing RR-CI activities in conjunction with the TNGA. Urgent VA (value analysis) Activities began in fiscal
2008 and developed into All-Toyota VA Activities at the beginning of fiscal 2010 as part of Toyota’s ongoing
unified cost reduction effort with suppliers for the various types of vehicles already on sale. In addition, Toyota
has been working on the TNGA to achieve sweeping advances in basic performance and product appeal of partsand units as well as seeking cost reductions by sharing more parts and implementing manufacturing reforms.
In fiscal 2015, market prices of raw materials such as steel generally remained at the same level or slightly
decreased in comparison to the prior fiscal year due in part to the depreciation of the yen despite downward
pressure due to decreased demand in China. The direction of prices is still unforeseeable. Toyota is continuallypromoting cost reduction efforts, such as reducing the amount of raw materials it uses.
Toyota’s ability to continue to obtain supplies in an efficient manner is subject to a number of factors, someof which are not in Toyota’s control. These factors include the ability of its suppliers to provide a continued
source of supplies and the effect on Toyota of competition by other users in obtaining the supplies.
Intellectual Property
Toyota holds numerous Japanese and foreign patents, trademarks, design patents and some utility model
registrations. It also has a number of applications pending for Japanese and foreign patents. While Toyota
considers all of its intellectual property to be important, it does not consider any one or group of patents,
trademarks, design patents or utility model registrations to be so important that their expiration or termination
would materially affect Toyota’s business.

47

Capital Expenditures and Divestitures
Set forth below is a chart of Toyota’s principal capital expenditures between April 1, 2012 and March 31,
2015, the approximate total costs of such activity, as well as the location and method of financing of suchactivity, presented on a “by subsidiary” basis and as reported in Toyota’s annual Japanese securities report filedwith the director of the Kanto Local Finance Bureau.

Description of Activity

Japan
Investment primarily in technology and products by
Toyota Motor Corporation . . . . . . . . . . . . . . . . . . . . . . .

Investment primarily in technology and products byHino Motors, Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment primarily in technology and products by
Daihatsu Motor Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . .
Investment primarily in technology and products by
Toyota Auto Body Co., Ltd. . . . . . . . . . . . . . . . . . . . . . .
Investment primarily in technology and products byPrimeearth EV Energy Co., Ltd. . . . . . . . . . . . . . . . . . . .
Outside of Japan
Investment primarily to promote localization by
Toyota Motor Thailand Co., Ltd. . . . . . . . . . . . . . . . . . .
Investment primarily to promote localization by
Toyota Motor Manufacturing Canada Inc. . . . . . . . . . . .
Investment primarily to promote localization by
P.T. Toyota Motor Manufacturing Indonesia . . . . . . . . .
Investment primarily to promote localization by
Toyota Motor Manufacturing, Kentucky, Inc. . . . . . . . .
Investment primarily to promote localization by
Toyota Argentina S.A. . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment primarily to promote localization by
Toyota do Brasil Ltda. . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment primarily to promote localization by
Toyota Motor Europe NV/SA . . . . . . . . . . . . . . . . . . . .
Investment primarily to promote localization by
Toyota Motor Manufacturing, Indiana, Inc. . . . . . . . . . .
Investment primarily to promote localization by
Siam Toyota Manufacturing Co., Ltd. . . . . . . . . . . . . . .
Investment primarily in leased automobiles by
Toyota Motor Credit Corporation . . . . . . . . . . . . . . . . .

48

Primary
Method ofFinancing

Total Cost
(Yen in billions)

Location

692.9

Japan

Internal funds,
financingfrom issuanceof bonds, etc.

93.4

Japan

Internal funds

88.7

Japan

Internal funds

70.3

Japan

Internal funds

56.9

Japan

Borrowings

133.8

ThailandInternal funds

113.8

CanadaInternal funds

94.5

Indonesia

Internal funds

93.8

United States

Internal funds

67.4

Argentina

Internal funds

66.5

BrazilInternal funds

65.1

BelgiumInternal funds

63.6

United States

Internal funds

54.8

ThailandInternal funds

4,415.7

United States

Internal funds,
financingfrom issuanceof bonds, etc.

Set forth below is information with respect to Toyota’s material plans to construct, expand or improve its
facilities between April 2015 and March 2016, presented on a “by subsidiary” basis and as reported in Toyota’s
annual Japanese securities report filed with the director of the Kanto Local Finance Bureau.
Total Cost
(Yen in billions)

Location

Primary
Method ofFinancingJapan
Investment primarily in manufacturing facilities by
Toyota Motor Corporation . . . . . . . . . . . . . . . . . . . . . . . . . .

300.0

Japan

Internal funds

Investment primarily in manufacturing facilities byHino Motors, Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

59.0

Japan

Internal funds
and borrowings

61.6

ThailandInternal funds

Description of Activity

Outside of Japan
Investment primarily in manufacturing facilities by
Toyota Motor Thailand Co., Ltd. . . . . . . . . . . . . . . . . . . . . .
Investment primarily in manufacturing facilities by
Toyota Motor Manufacturing, Kentucky, Inc. . . . . . . . . . . .
Investment primarily in manufacturing facilities by
P.T. Toyota Motor Manufacturing Indonesia . . . . . . . . . . .
Investment primarily in manufacturing facilities by
Toyota Motor Manufacturing Canada Inc. . . . . . . . . . . . . . .

52.5

United States Internal funds

51.9

Indonesia

Internal funds
and borrowings

42.9

CanadaInternal funds

Set forth below is additional information with respect to Toyota’s material plans to construct, expand or
improve its facilities.
Toyota plans to increase production capacity at its Argentina factory from 90 thousand units to
140 thousand units annually during 2015 and 2016, and at its Sorocaba Plant in Brazil from 70 thousand units to
110 thousand units annually in 2016. Toyota also plans to build a new plant in Mexico in 2019, and to complete
construction of a third plant in Guangzhou in China in 2017.
To enhance production capacity of auto parts, Toyota plans to construct a plant for hybrid vehicle battery
production in China in October 2015 and a plant for passenger vehicle engine production in Indonesia and Brazil
in 2016.
Toyota does not collect information on the amount of expenditures already paid for each plant underconstruction because Toyota believes that it is difficult and it would require unreasonable effort or expense to
identify and categorize each expenditure item with reasonable accuracy as past and future expenditures. Toyota’s
construction projects consist of numerous expenditures, each of which is continually being adjusted and incurredin variable and constantly changing amounts as part of the overall work-in-progress.
Seasonality
Toyota does not consider its seasonality material in the sense of significantly higher sales during any certain
period of the year as compared to other periods of the year.
Legal Proceedings
From time-to-time, Toyota issues vehicle recalls and takes other safety measures including safety campaigns
relating to its vehicles. In 2009 and 2010, Toyota issued safety campaigns related to the risk of floor mat
49

entrapment of accelerator pedals and vehicle recalls related to slow-to-return or sticky accelerator pedals.
Following some of these recalls and other safety measures, a large number of putative class actions andindividual lawsuits were brought against Toyota, alleging that certain Toyota, Lexus and Scion vehicles
contained defects that led to unintended acceleration. The class actions and individual lawsuits related toeconomic loss were resolved by a settlement which was approved by the United States District Court for theCentral District of California in July 2013, and the settlement of those claims is final.
There were also several government investigations related to unintended acceleration. The last of these to beresolved was the investigation initiated by the U.S. Attorney for the Southern District of New York in
February 2010. In March 2014, Toyota announced that it entered into a deferred prosecution agreement (“DPA”)
with the U.S. Attorney’s Office to resolve its investigation. The DPA provided for a $1.2 billion payment to the
U.S. government, and Toyota recorded a $1.2 billion charge against earnings in fiscal 2014. Pursuant to the DPA,
an independent monitor was appointed to review and assess policies and procedures relating to Toyota’s safety
communications process, its process for sharing vehicle accident information internally and its process for
preparing and sharing certain technical reports.
In 2010, there was a recall related to the software program that controls the antilock braking system incertain models including the Prius, which led to putative class action lawsuits on behalf of owners of recalled
vehicles and owners of vehicles which were not recalled. These cases were consolidated into two actions, one in
the United States District Court for the Central District of California and one in the Los Angeles County Superior
Court. In January 2013, the United States District Court for the Central District of California denied theplaintiff’s motion for class certification and granted summary judgment in Toyota’s favor resolving the claims
related to the recalled vehicles, and in July 2013, the United States District Court for the Central District ofCalifornia denied the plaintiff’s motion for class certification and granted summary judgment in Toyota’s favorregarding the claims related to the non-recalled vehicles. Proceedings involving the recalled vehicles in bothcourts have concluded. The ruling of the United States District Court for the Central District of California related
to the non-recalled vehicles has been appealed.
Product liability personal injury claims related to the floor mat entrapment of accelerator pedals and slowto-return or sticky accelerator pedal cases are pending in several consolidated cases in federal and state courts, aswell as in individual cases in various other states. The judges in the consolidated federal action and theconsolidated California state action have approved an Intensive Settlement Process (“ISP”) for such claims inthose actions. Under the ISP, all individual claims within the consolidated actions are stayed pending completionof a process to assess whether they can be resolved on terms acceptable to the parties. Cases not resolved after
completion of the ISP will then proceed to discovery and toward trial. Toyota has offered the ISP process toplaintiffs in other consolidated actions and in individual cases, as well.
Toyota has been named as a defendant in 27 economic loss class action lawsuits, which have been
consolidated for pretrial purposes in the United States District Court for the Southern District of Florida, arisingout of allegations that Takata airbags installed in Toyota vehicles are defective. These lawsuits are at a very earlystage.
Toyota also has various other legal actions, other governmental proceedings and other claims pending
against it, including other product liability claims in the United States.
Beyond the amounts accrued with respect to all aforementioned matters, Toyota is unable to estimate a
range of reasonably possible loss, if any, for the pending legal matters because (i) many of the proceedings are inevidence gathering stages, (ii) significant factual issues need to be resolved, (iii) the legal theory or nature of theclaims is unclear, (iv) the outcome of future motions or appeals is unknown and/or (v) the outcomes of othermatters of these types vary widely and do not appear sufficiently similar to offer meaningful guidance. Basedupon information currently available to Toyota, however, Toyota believes that its losses from these matters, ifany, beyond the amounts accrued, would not have a material adverse effect on Toyota’s financial position, resultsof operations or its cash flows.
50

4.C ORGANIZATIONAL STRUCTURE
As of March 31, 2015, Toyota Motor Corporation had 261 Japanese subsidiaries and 280 overseas
subsidiaries. The following table sets forth for each of Toyota Motor Corporation’s principal subsidiaries, thecountry of incorporation and the percentage ownership interest and the voting interest held by Toyota Motor
Corporation.
Country ofIncorporation

Name of Subsidiary

Toyota Financial Services Corporation . . . . . . . . . . . . . . . . . . . . . . . . . .
JapanHino Motors, Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Japan
Toyota Motor Kyushu, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
JapanDaihatsu Motor Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Japan
Toyota Finance Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Japan
Toyota Auto Body Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Japan
Toyota Motor East Japan, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Japan
Toyota Motor Engineering & Manufacturing North America, Inc. . . . . United States
Toyota Motor Manufacturing, Kentucky, Inc. . . . . . . . . . . . . . . . . . . . . United States
Toyota Motor North America, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United States
Toyota Motor Credit Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United States
Toyota Motor Manufacturing, Indiana, Inc. . . . . . . . . . . . . . . . . . . . . . . United States
Toyota Motor Manufacturing, Texas, Inc. . . . . . . . . . . . . . . . . . . . . . . . United States
Toyota Motor Sales, U.S.A., Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United States
Toyota Motor Manufacturing, Mississippi, Inc. . . . . . . . . . . . . . . . . . . . United states
Toyota Motor Manufacturing Canada Inc. . . . . . . . . . . . . . . . . . . . . . . .
CanadaToyota Credit Canada Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
CanadaToyota Canada Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
CanadaToyota Motor Europe NV/SA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
BelgiumToyota Motor Manufacturing France S.A.S. . . . . . . . . . . . . . . . . . . . . . .
FranceToyota Kreditbank GmbH . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Germany
Toyota Motor Finance (Netherlands) B.V. . . . . . . . . . . . . . . . . . . . . . . . Netherlands
Toyota Motor Manufacturing (UK) Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . United Kingdom
Toyota Financial Services (UK) PLC . . . . . . . . . . . . . . . . . . . . . . . . . . . United Kingdom
Toyota (GB) PLC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United Kingdom
OOO “TOYOTA MOTOR” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
RussiaToyota Motor (China) Investment Co., Ltd. . . . . . . . . . . . . . . . . . . . . . .
China
Toyota Motor Finance (China) Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . .
China
P.T. Toyota Motor Manufacturing Indonesia . . . . . . . . . . . . . . . . . . . . .
Indonesia
Toyota Motor Asia Pacific Pte Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Singapore
Kuozui Motors, Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
TaiwanToyota Leasing (Thailand) Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ThailandToyota Motor Thailand Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ThailandToyota Motor Asia Pacific Engineering and Manufacturing Co., Ltd. . . .
ThailandToyota Motor Corporation Australia Ltd. . . . . . . . . . . . . . . . . . . . . . . . .
Australia
Toyota Finance Australia Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Australia
Toyota Argentina S.A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Argentina
Toyota do Brasil Ltda. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
BrazilToyota South Africa Motors (Pty) Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . South Africa

51

Percentage
Ownership
Interest

Percentage
VotingInterest

100.0050.21
100.0051.33
100.00100.00100.00100.00100.00100.00100.00100.00100.00100.00100.00100.00100.0051.00
100.00100.00100.00100.00100.00100.00100.00100.00100.00100.0095.00
100.00
70.00
86.84
86.43
100.00100.00100.00100.00100.00100.00100.0050.36
100.0051.50
100.00100.00100.00100.00100.00100.00100.00100.00100.00100.00100.00100.00100.0051.00
100.00100.00100.00100.00100.00100.00100.00100.00100.00100.0095.00
100.00
70.00
86.84
86.43
100.00100.00100.00100.00100.00100.004.D PROPERTY, PLANTS AND EQUIPMENT
As of March 31, 2015, Toyota and its affiliated companies produced automobiles and related components
through more than 50 overseas manufacturing organizations in 28 countries and regions besides Japan. The
facilities are located principally in Japan, the United States, Canada, the United Kingdom, France, Turkey,
Thailand, China, Taiwan, India, Indonesia, South Africa, Australia, Argentina and Brazil.
In addition to its manufacturing facilities, Toyota’s properties include sales offices and other sales facilities
in major cities, repair service facilities and research and development facilities.
The following table sets forth information, as of March 31, 2015, with respect to Toyota’s principal
facilities and organizations, all of which are owned by Toyota Motor Corporation or its subsidiaries. However,small portions, all under approximately 20%, of some facilities are on leased premises.

Facility or Subsidiary NameLand Area(thousandsquareNumber ofmeters) Employees

Location

Principal
Products orFunctionsJapan (Toyota Motor Corporation)
Tahara Plant . . . . . . . . . . . . . . . . . . . . . Tahara City, Aichi Pref.
Higashi-Fuji Technical Center . . . . . . . Susono City, Shizuoka Pref.

4,029
2,041

7,075
3,026

Automobiles
Research andDevelopment

Toyota Head Office and TechnicalCenter . . . . . . . . . . . . . . . . . . . . . . . . Toyota City, Aichi Pref.

1,930

23,023

Motomachi Plant . . . . . . . . . . . . . . . . . Toyota City, Aichi Pref.
Takaoka Plant . . . . . . . . . . . . . . . . . . . . Toyota City, Aichi Pref.
Tsutsumi Plant . . . . . . . . . . . . . . . . . . . Toyota City, Aichi Pref.
Kamigo Plant . . . . . . . . . . . . . . . . . . . . Toyota City, Aichi Pref.
Kinu-ura Plant . . . . . . . . . . . . . . . . . . . Hekinan City, Aichi Pref.
Honsha Plant . . . . . . . . . . . . . . . . . . . . . Toyota City, Aichi Pref.
Nagoya Office . . . . . . . . . . . . . . . . . . . Nagoya City, Aichi Pref.

1,594
1,312
937
868
836
551
3

7,249
3,551
4,615
2,955
3,042
1,804
2,210

Research andDevelopment
Automobiles
Automobiles
Automobiles
Automobile parts
Automobile parts
Automobile parts
Office

8,409
6,009
2,254
2,613

11,446
11,844
11,338
7,170

Automobiles
Automobiles
Automobiles
Automobiles

1,940

7,411

Automobiles

4,756
4,414
3,755

6,683
9,933
6,413

Automobiles
Automobiles
Sales facilities

4,348

4,745

Automobiles

5,161

7,442

Automobiles

Japan (Subsidiaries)
Daihatsu Motor Co., Ltd. . . . . . . . . . . . Ikeda City, Osaka, etc.
Hino Motors, Ltd. . . . . . . . . . . . . . . . . . Hino City, Tokyo, etc.
Toyota Auto Body Co., Ltd. . . . . . . . . . Kariya City, Aichi Pref., etc.
Toyota Motor East Japan, Inc. . . . . . . . Kurokawa-gun, Miyagi Pref.,etc.
Toyota Motor Kyushu, Inc. . . . . . . . . . Miyawaka City, Fukuoka Pref.,etc.
Outside Japan (Subsidiaries)
Toyota Motor Manufacturing Canada,Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . Ontario, Canada
Toyota Motor Thailand Co., Ltd. . . . . . Samutprakan, Thailand
Toyota Motor Sales, U.S.A., Inc. . . . . . California, U.S.A.
Toyota Motor Manufacturing, Indiana,
Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . Indiana, U.S.A.
Toyota Motor Manufacturing,
Kentucky, Inc. . . . . . . . . . . . . . . . . . Kentucky, U.S.A.

52

Toyota is constantly engaged in upgrading, modernizing and revamping the operations of its manufacturing
facilities based on its assessment of market needs and prospects. To respond flexibly to fluctuations in demand ineach of its production operations throughout the world, Toyota continually reviews and implements appropriate
production measures such as revising takt time and adjusting days of operation. As a result, Toyota believes it
would require unreasonable effort to track the exact productive capacity and the extent of utilization of each of its
manufacturing facilities with a reasonable degree of accuracy.
As of March 31, 2015, property, plant and equipment having a net book value of approximately ¥192.3
billion was pledged as collateral securing indebtedness incurred by Toyota Motor Corporation’s consolidated
subsidiaries. Toyota believes that there does not exist any material environmental issues that may affect thecompany’s utilization of its assets.
Toyota considers all its principal manufacturing facilities and other significant properties to be in goodcondition and adequate to meet the needs of its operations.
See “— Business Overview — Capital Expenditures and Divestitures” for a description of Toyota’s materialplans to construct, expand or improve facilities.
ITEM 4A. UNRESOLVED STAFF COMMENTS
None.
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
5.A OPERATING RESULTS
Financial information discussed in this section is derived from Toyota’s consolidated financial statementsthat appear elsewhere in this annual report. The financial statements have been prepared in conformity withaccounting principles generally accepted in the United States of America.
Overview
The business segments of Toyota include automotive operations, financial services operations and all otheroperations. Automotive operations are Toyota’s most significant business segment, accounting for 90% of
Toyota’s total revenues before the elimination of intersegment revenues for fiscal 2015. Toyota’s primarymarkets based on vehicle unit sales for fiscal 2015 were: Japan (24%), North America (30%), Europe (10%) andAsia (17%).
Automotive Market Environment
The worldwide automotive market is highly competitive and volatile. The demand for automobiles isaffected by a number of factors including social, political and general economic conditions; introduction of newvehicles and technologies; and costs incurred by customers to purchase or operate vehicles. These factors cancause consumer demand to vary substantially in different geographic markets and for different types ofautomobiles.
During fiscal 2015, although automotive markets have progressed in a steady manner, especially in the U.S.,
markets in some emerging countries have become stagnant and the Japanese market slowed down due to theconsumption tax increase. Efforts toward building a low-carbon society through eco-cars and improvements insafety increased worldwide.

53

The following table sets forth Toyota’s consolidated vehicle unit sales by geographic market based on
location of customers for the past three fiscal years.
Thousands of units
Year Ended March 31,
2013
2014
2015

Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,279 2,365 2,154
North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,469 2,529 2,715
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
799
844
859
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,684 1,609 1,489
Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,640 1,769 1,755
Overseas total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6,592

6,751

6,818

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8,871

9,116

8,972

* “Other” consists of Central and South America, Oceania, Africa and the Middle East, etc.
During fiscal 2014, Toyota’s consolidated vehicle unit sales in Japan increased as compared with prior fiscal
year, primarily as a result of the active introduction of new products and the efforts of dealers nationwide. For
fiscal 2014, Toyota and Lexus brands’ market share excluding mini-vehicles was 46.7% and market share(including Daihatsu and Hino brands) including mini-vehicles was 42.2%. During fiscal 2015, Toyota’s
consolidated vehicle unit sales in Japan decreased as compared with the prior fiscal year under the market
downturn in Japan. However, with the efforts of dealers nationwide, for fiscal 2015, Toyota and Lexus brands’
market share excluding mini-vehicles was 46.0%, and market share (including Daihatsu and Hino brands)
including mini-vehicles was 41.8%, each remaining at a high level as was in the prior fiscal year. Overseas
consolidated vehicle unit sales increased during fiscal 2014 and 2015. During fiscal 2014, total overseas vehicle
unit sales increased as a whole, due to increased sales in North America, Europe and other regions. During fiscal
2015, total overseas vehicle unit sales increased as a whole, due to increased sales in North America and Europe.
Toyota’s share of total vehicle unit sales in each market is influenced by the quality, safety, reliability, price,design, performance, economy and utility of Toyota’s vehicles compared with those offered by othermanufacturers. 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 revenues and earnings
significantly.
The profitability of Toyota’s automotive operations is affected by many factors. These factors include:•

vehicle unit sales volumes,•

the mix of vehicle models and options sold,•the level of parts and service sales,•

the levels of price discounts and other sales incentives and marketing costs,•

the cost of customer warranty claims and other customer satisfaction actions,•the cost of research and development and other fixed costs,•

the prices of raw materials,•

the ability to control costs,•

the efficient use of production capacity,•

the adverse effect on production due to the reliance on various suppliers for the provision of supplies,54•

the adverse effect on market, sales and productions of natural calamities and interruptions of social
infrastructure, and•changes in the value of the Japanese yen and other currencies in which Toyota conducts business.

Changes in laws, regulations, policies and other governmental actions can also materially impact the
profitability of Toyota’s automotive operations. These laws, regulations and policies include those attributed toenvironmental matters, vehicle safety, fuel economy and emissions that can add significantly to the cost ofvehicles. The European Union has enforced a directive on end-of-life vehicles. See “Information on the
Company — Business Overview — Governmental Regulation, Environmental and Safety Standards” for a moredetailed discussion of these laws, regulations and policies.
Many governments also impose local content requirements, impose tariffs and other trade barriers, and enact
price or exchange controls that can limit an automaker’s operations and can make the repatriation of profits
unpredictable. Changes in these laws, regulations, policies and other governmental actions may affect the
production, licensing, distribution or sale of Toyota’s products, cost of products or applicable tax rates. From
time-to-time when potential safety problems arise, Toyota issues vehicle recalls and takes other safety measures
including safety campaigns relating to its vehicles. In 2009 and 2010, Toyota issued safety campaigns related to
the risk of floor mat entrapment of accelerator pedals and vehicle recalls related to slow-to-return or sticky
accelerator pedals. In 2010, Toyota announced a recall related to the software program that controls the antilock
braking system in certain models including the Prius. The recalls and other safety measures described above have
led to a number of claims and lawsuits against Toyota. For a more detailed description of these claims andlawsuits, see “Information on the Company — Business Overview — Legal Proceedings” and note 23 to theconsolidated financial statements.
The worldwide automotive industry is in a period of global competition which may continue for theforeseeable future, and in general the competitive environment in which Toyota operates is likely to intensify.
Toyota believes it has the resources, strategies and technologies in place to compete effectively in the industry as
an independent company for the foreseeable future.
Financial Services Operations
The competition in the worldwide automobile financial services industry is intensifying. As competition
increases, margins on financing transactions may decrease and market share may also decline as customers
obtain financing for Toyota vehicles from alternative sources.
Toyota’s financial services operations mainly include loans and leasing programs for customers and dealers.
Toyota believes that its ability to provide financing to its customers is an important value added service.
Therefore, Toyota has expanded its network of finance subsidiaries in order to offer financial services in many
countries.
Toyota’s competitors for retail financing and retail leasing include commercial banks, credit unions andother finance companies. Meanwhile, commercial banks and other captive automobile finance companies also
compete against Toyota’s wholesale financing activities.
Toyota’s total finance receivables increased during fiscal 2015 mainly due to the favorable impact offluctuations in foreign currency translation rates and an increase in retail receivables. Also, vehicles andequipment on operating leases, net increased during fiscal 2015 mainly due to the favorable impact offluctuations in foreign currency translation rates and an increase in vehicles on operating leases in financial
services subsidiaries in North America.

55

The following table provides information regarding Toyota’s finance receivables and operating leases in thepast two fiscal years.
Yen in millions
March 31,
2014
2015

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 finance receivables, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less – Current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10,523,364
1,071,179
2,875,650

12,015,844
1,158,361
3,124,079

14,470,193 16,298,284
161,956
179,905(754,539)(837,124)(89,439)(30,585)(26,358)(109,316)(29,303)(30,053)(146,382)(168,672)

13,731,228 15,472,393(5,628,934) (6,269,862)

Noncurrent finance receivables, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8,102,294

9,202,531

Operating Leases
Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less – Deferred income and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3,674,969
129,029(94,438)

5,169,524
163,195(132,733)

Less – Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less – Allowance for credit losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3,709,560
5,199,986(808,764) (1,080,936)(7,220)(9,366)

Vehicles and equipment on operating leases, net . . . . . . . . . . . . . . . . . . . . . . . . . .

2,893,576

4,109,684

Toyota’s finance receivables are subject to collectability risks. These risks include consumer and dealer
insolvencies and insufficient collateral values (less costs to sell) to realize the full carrying values of thesereceivables. See discussion in “Critical Accounting Estimates — Allowance for Doubtful Accounts and Credit
Losses” and note 10 to the consolidated financial statements.
Toyota continues to originate leases to finance new Toyota vehicles. These leasing activities are subject toresidual value risk. Residual value losses could be incurred when the lessee of a vehicle does not exercise theoption to purchase the vehicle at the end of the lease term. See discussion in “Critical Accounting Estimates —Investment in Operating Leases” and note 2 to the consolidated financial statements.
Toyota enters into interest rate swap agreements and cross currency interest rate swap agreements to convert
its fixed-rate debt to variable-rate functional currency debt. A portion of the derivative instruments are enteredinto to hedge interest rate risk from an economic perspective and are not designated as a hedge of specific assets
or liabilities on Toyota’s consolidated balance sheet and accordingly, unrealized gains or losses related toderivatives that are not designated as a hedge are recognized currently in operations. See discussion in “Critical
Accounting Estimates — Derivatives and Other Contracts at Fair Value” and “Quantitative and Qualitative
Disclosures about Market Risk” and notes 20 and 26 to the consolidated financial statements.
The fluctuations in funding costs can affect the profitability of Toyota’s financial services operations.
Funding costs are affected by a number of factors, some of which are not in Toyota’s control. These factors
56

include general economic conditions, prevailing interest rates and Toyota’s financial strength. Funding costs
decreased during fiscal 2014 and 2015, mainly as a result of lower interest rates.
Toyota launched its credit card business in Japan in April 2001. As of March 31, 2014, Toyota had
12.7 million cardholders, an increase of 0.9 million cardholders compared with March 31, 2013. As of March 31,
2015, Toyota had 13.5 million cardholders, an increase of 0.8 million cardholders compared with March 31,
2014. Credit card receivables as of March 31, 2014 increased by ¥42.8 billion from March 31, 2013 to¥380.9 billion. Credit card receivables as of March 31, 2015 was nearly equal to as of March 31, 2014 to¥380.9 billion.
Other Business Operations
Toyota’s other business operations consist of housing (including the manufacture and sale of prefabricatedhomes), information technology related businesses (including information technology and telecommunications,
intelligent transport systems and GAZOO) and other businesses.
Toyota does not expect its other business operations to materially contribute to Toyota’s consolidated resultsof operations.
Currency Fluctuations
Toyota is affected by fluctuations in foreign currency exchange rates. Toyota is exposed to fluctuations in
the value of the Japanese yen against the U.S. dollar and the euro and, to a lesser extent, the Australian dollar, theRussian ruble, the Canadian dollar, the British pound, and others. Toyota’s consolidated financial statements,
which are presented in Japanese yen, are affected by foreign currency exchange fluctuations through bothtranslation risk and transaction risk.
Translation risk is the risk that Toyota’s consolidated financial statements for a particular period or for aparticular date will be affected by changes in the prevailing exchange rates of the currencies in those countries inwhich Toyota does business compared with the Japanese yen. Even though the fluctuations of currency exchange
rates to the Japanese yen can be substantial, and, therefore, significantly impact comparisons with prior periods
and among the various geographic markets, the translation risk is a reporting consideration and does not reflect
Toyota’s underlying results of operations. Toyota does not hedge against translation risk.
Transaction risk is the risk that the currency structure of Toyota’s costs and liabilities will deviate from thecurrency structure of sales proceeds and assets. Transaction risk relates primarily to sales proceeds from Toyota’s
non-domestic operations from vehicles produced in Japan.
Toyota believes that the location of its production facilities in different parts of the world has significantly
reduced the level of transaction risk. As part of its globalization strategy, Toyota has continued to localize
production by constructing production facilities in the major markets in which it sells its vehicles. In calendar
2013 and 2014, Toyota produced 76.3% and 76.5%, respectively, of its non-domestic sales outside Japan. In
North America, 73.7% and 74.4% of vehicles sold in calendar 2013 and 2014, respectively, were produced
locally. In Europe, 69.4% and 73.7% of vehicles sold in calendar 2013 and 2014, respectively, were produced
locally. Localizing production enables Toyota to locally purchase many of the supplies and resources used in the
production process, which allows for a better match of local currency revenues with local currency expenses.
Toyota also enters into foreign currency transactions and other hedging instruments to address a portion of
its transaction risk. This has reduced, but not eliminated, the effects of foreign currency exchange rate
fluctuations, which in some years can be significant. See notes 20 and 26 to the consolidated financial statements
for additional information.
57

Generally, a weakening of the Japanese yen against other currencies has a positive effect on Toyota’s
revenues, operating income and net income attributable to Toyota Motor Corporation. A strengthening of theJapanese yen against other currencies has the opposite effect. In fiscal 2014 and 2015, the Japanese yen was on
average and at the end of the fiscal year weaker against the U.S. dollar in comparison to fiscal 2013 and 2014,
respectively. In fiscal 2014 and 2015, the Japanese yen was on average weaker against the euro in comparison to
fiscal 2013 and 2014, respectively. The Japanese yen was at the end of fiscal 2014 weaker against the euro incomparison to fiscal 2013, but was at the end of fiscal 2015 stronger against the euro in comparison to fiscal
2014. See further discussion in “Quantitative and Qualitative Disclosures about Market Risk — Market Risk
Disclosures — Foreign Currency Exchange Rate Risk”.
During fiscal 2014 and 2015, the average exchange rate of the Japanese yen against the U.S. dollar and theeuro compared to the prior fiscal year fluctuated as described above. The operating results excluding the impactof currency fluctuations described in “Results of Operations — Fiscal 2015 Compared with Fiscal 2014” and“Results of Operations — Fiscal 2014 Compared with Fiscal 2013” show results of net revenues obtained byapplying the Japanese yen’s average exchange rate in the previous fiscal year to the local currency-denominated
net revenues for fiscal 2014 and 2015, respectively, as if the value of the Japanese yen had remained constant forthe comparable periods. Results excluding the impact of currency fluctuations year-on-year are not on the same
basis as Toyota’s consolidated financial statements and do not conform with U.S. GAAP. Furthermore, Toyota
does not believe that these measures are a substitute for U.S. GAAP measures. However, Toyota believes thatsuch results excluding the impact of currency fluctuations year-on-year provide additional useful information toinvestors regarding the operating performance on a local currency basis.
Segmentation
Toyota’s most significant business segment is its automotive operations. Toyota carries out its automotive
operations as a global competitor in the worldwide automotive market. Management allocates resources to, andassesses the performance of, its automotive operations as a single business segment on a worldwide basis. Toyota
does not manage any subset of its automotive operations, such as domestic or overseas operations or parts, as
separate management units.
The management of the automotive operations is organized by function, with a manager having oversight
responsibility for each function within the segment. Management assesses financial and non-financial data suchas vehicle unit sales, production volume, market share information, vehicle model plans and plant location costs
to allocate resources within the automotive operations.
Geographic Breakdown
The following table sets forth Toyota’s net revenues in each geographic market based on the country oflocation of the parent company or the subsidiaries that transacted the sale with the external customer for the past
three fiscal years.
Yen in millions
Year ended March 31,
2013
2014
2015

Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7,910,456
6,167,821
2,003,113
4,058,629
1,924,173* “Other” consists of Central and South America, Oceania, Africa and the Middle East.
58

8,532,875
7,938,615
2,614,070
4,475,382
2,130,969

8,338,881
9,430,450
2,690,803
4,531,178
2,243,209

Results of Operations — Fiscal 2015 Compared with Fiscal 2014
Yen in millions
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Net revenues:
Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intersegment elimination/unallocated amount . . . . . . . . .

14,297,470 14,403,867
106,397
8,117,099
9,677,596 1,560,497
2,724,959
2,848,294
123,335
4,877,672
4,981,240
103,568
2,336,641
2,449,238
112,597(6,661,930) (7,125,714) (463,784)

0.7%
19.2
4.5
2.1
4.8
—

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income:Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intersegment elimination/unallocated amount . . . . . . . . .

25,691,911

27,234,521

1,542,610

6.0

1,510,165
326,052
58,228395,737
42,568(40,638)

1,571,476
584,519
81,118421,782
111,509(19,840)

61,311
258,467
22,89026,04568,941
20,798

4.1
79.3
39.3
6.6
162.0
—

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income before income taxes and equity in earnings ofaffiliated companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net margin from income before income taxes and equity inearnings of affiliated companies . . . . . . . . . . . . . . . . . . . . .
Equity in earnings of affiliated companies . . . . . . . . . . . . . . .
Net income attributable to Toyota Motor Corporation . . . . . .
Net margin attributable to Toyota Motor Corporation . . . . . . .

2,292,112
2,750,564
458,452
8.9%
10.1%
1.2%

20.0

2,441,080

18.5

2,892,828

451,748

9.5%
10.6%
1.1%
318,376
308,545(9,831)
1,823,119
2,173,338
350,219
7.1%
8.0%
0.9%

(3.1)
19.2

* “Other” consists of Central and South America, Oceania, Africa and the Middle East.
Net Revenues
Toyota had net revenues for fiscal 2015 of ¥27,234.5 billion, an increase of ¥1,542.6 billion, or 6.0%,
compared with the prior fiscal year. This increase mainly reflected the favorable impact of fluctuations in foreign
currency translation rates of ¥962.2 billion and changes in vehicle unit sales and sales mix of ¥360.0 billion.
Excluding the impact of changes in the Japanese yen values used for translation purposes of ¥962.2 billion, net
revenues would have been ¥26,272.2 billion during fiscal 2015, a 2.3% increase compared with the prior fiscal
year. The North America automotive market in calendar year 2014 increased by 5.8% compared with the priorcalendar year due to the market in the U.S progressing in a steady manner. However the Japanese automotive
market in fiscal 2015 decreased by 8.9% compared with the prior fiscal year due to the market downturn
resulting from the consumption tax increase. Under these automotive market conditions, Toyota’s consolidated
vehicle unit sales decreased by 1.6% compared with the prior fiscal year to 8,972 thousand vehicles.

59

The table below shows Toyota’s net revenues from external customers by product category and by business.
Yen in millions
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Parts and components for overseas production . . . . . . . . . . . .
Parts and components for after service . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

20,353,340
431,760
1,843,478
1,105,277

21,557,684
402,864
1,921,764
1,123,912

1,204,344(28,896)
78,286
18,635

5.9%
(6.7)
4.2
1.7

Total Automotive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
All Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

23,733,855
578,789

25,006,224
606,612

1,272,369
27,823

5.4
4.8

Total sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,312,644
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,379,267

25,612,836
1,621,685

1,300,192
242,418

5.3
17.6

27,234,521

1,542,610

6.0%

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

25,691,911

Toyota’s net revenues include net revenues from sales of products, consisting of net revenues fromautomotive operations and all other operations, which increased by 5.3% during fiscal 2015 compared with theprior fiscal year to ¥25,612.8 billion, and net revenues from financial services operations which increased by
17.6% during fiscal 2015 compared with the prior fiscal year to ¥1,621.6 billion. Excluding the impact ofchanges in the Japanese yen values used for translation purposes of ¥864.5 billion, net revenues from sales of
products would have been ¥24,748.2 billion during fiscal 2015, a 1.8% increase compared with the prior fiscal
year. The increase in net revenues from sales of products is mainly due to changes in vehicle unit sales and sales
mix. Excluding the impact of changes in the Japanese yen values used for translation purposes of ¥97.7 billion,
net revenues from financial services operations would have been ¥1,523.9 billion during fiscal 2015, a 10.5%
increase compared with the prior fiscal year.
The following table shows the number of financing contracts by geographic region at the end of fiscal 2015
and 2014, respectively.
Number of financing contracts in thousands
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,813
4,791
879
1,167
688

1,873
5,046
910
1,382
741

60
255
31
215
53

3.3%
5.3
3.6
18.4
7.7

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9,338

9,952

614

6.6%

* “Other” consists of Central and South America, Oceania and Africa.
Geographically, net revenues (before the elimination of intersegment revenues) for fiscal 2015 increased by
0.7% in Japan, 19.2% in North America, 4.5% in Europe, 2.1% in Asia, and 4.8% in Other compared with theprior fiscal year. Excluding the impact of changes in the Japanese yen values used for translation purposes of¥962.2 billion, net revenues in fiscal 2015 would have increased by 0.7% in Japan, 9.5% in North America, 4.4%
in Europe and 7.2% in Other compared with the prior fiscal year, and would have decreased by 3.7% in Asia
compared with the prior fiscal year.

60The following is a discussion of net revenues in each geographic market (before the elimination ofintersegment revenues).
Japan
Thousands of units
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Toyota’s consolidated vehicle unit sales* . . . . . . . . . . . . . . . .

4,220

3,938

(282)

(6.7)%* including number of exported vehicle unit sales
Yen in millions
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Net revenues:
Sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,179,710 14,283,195
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
117,760
120,672

103,485
2,912

0.7%
2.5

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,297,470 14,403,867

106,397

0.7%

Net revenues in Japan increased due primarily to the effect of changes in exchange rates related to exporttransactions, despite Toyota’s domestic and exported vehicle unit sales decreasing by 282 thousand vehicles
compared with the prior fiscal year. For fiscal 2014 and 2015, exported vehicle unit sales were 1,854 thousand
units and 1,784 thousand units, respectively.
North America
Thousands of units
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Toyota’s consolidated vehicle unit sales . . . . . . . . . . . . . . . . .

2,529

2,715

186

7.3%

Yen in millions
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Net revenues:
Sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7,234,376
882,723

8,601,879 1,367,503
1,075,717
192,994

18.9%
21.9

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8,117,099

9,677,596 1,560,497

19.2%

Net revenues in North America increased due primarily to the favorable effect of fluctuations of currencytranslation rates to the Japanese yen, and the 186 thousand vehicles increase in vehicle unit sales compared withthe prior fiscal year. The vehicle unit sales increased due mainly to the market progressing in a steady mannerand strong sales of the Corolla, RAV4 and other car models.

61

EuropeThousands of units
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Toyota’s consolidated vehicle unit sales . . . . . . . . . . . . . . . . . . .

844

859

15

1.8%

Yen in millions
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Net revenues:
Sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,630,408
94,5512,724,959

2,750,164
98,1302,848,294

119,756
3,579
123,335

4.6%
3.8
4.5%

Net revenues in Europe increased due primarily to the 15 thousand vehicles increase in vehicle unit sales
compared with the prior fiscal year. The vehicle unit sales increased due mainly to the strong sales in Western
Europe, especially in Italy and the United Kingdom.
Asia
Thousands of units
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Toyota’s consolidated vehicle unit sales . . . . . . . . . . . . . . . . . . .

1,609

1,489

(120)

(7.4)%

Yen in millions
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Net revenues:
Sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4,755,114
122,558
4,877,672

4,833,952
147,288
4,981,240

78,83824,730103,568

1.7%
20.2
2.1%

Net revenues in Asia increased due primarily to the favorable impact of fluctuations in foreign currencytranslation rates despite the vehicle unit sales decreasing by 120 thousand compared with the prior fiscal year.
The decrease in vehicle unit sales was due mainly to decreased sales in Thailand and Indonesia, which in turn
was attributable mainly to the shrinking of the market and competitive market conditions.
Other
Thousands of units
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Toyota’s consolidated vehicle unit sales . . . . . . . . . . . . . . . . . . .

1,769

1,755

(14)

(0.8)%

Yen in millions
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Net revenues:
Sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
622,162,505
174,136
2,336,641

2,255,122
194,115
2,449,238

92,617
19,979112,597

4.3%
11.5
4.8%

Net revenues in Other increased due primarily to the changes in vehicle sales mix despite vehicle unit sales
decreasing by 14 thousand vehicles compared with the prior fiscal year.
Operating Costs and Expenses
Yen in millions
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Operating costs and expenses
Cost of products sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,988,245
Cost of financing operations . . . . . . . . . . . . . . . . . . . . . .
812,894
Selling, general and administrative . . . . . . . . . . . . . . . . .
2,598,660
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

23,399,799

20,916,362
925,3142,642,281

928,117
112,420
43,621

4.6%
13.8
1.7

24,483,957

1,084,158

4.6%

Yen in millions
2015 v. 2014 Change

Changes in operating costs and expenses:
Effect of changes in vehicle unit sales and sales mix . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of fluctuation in foreign currency translation rates . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

470,000
895,500(280,000)(1,342)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,084,158

Operating costs and expenses increased by ¥1,084.1 billion, or 4.6%, to ¥24,483.9 billion during fiscal 2015
compared with the prior fiscal year. This increase resulted mainly from the ¥895.5 billion unfavorable impact offluctuations in foreign currency translation rates and the ¥470.0 billion impact of changes in vehicle unit sales
and sales mix, partially offset by the ¥280.0 billion impact of cost reduction efforts and the ¥1.3 billion decreasein other.
The decrease in other was due mainly to the ¥125.0 billion payment to the U.S government based on theagreement with the U.S. Attorney’s Office for the Southern District of New York to resolve its investigation andthe ¥83.0 billion costs related to ending the vehicle and engine production in Australia, both being recorded in
the prior fiscal year, partially offset by the ¥140.0 billion increase in product quality related expenses and the¥100.0 billion increase in research and development expenses as compared to the prior fiscal year. See note 23 tothe consolidated financial statements for further discussion on the payment to the U.S government based on theagreement with the U.S. Attorney’s Office for the Southern District of New York to resolve its investigation, andsee note 27 to the consolidated financial statements for further discussion on the costs related to ending thevehicle and engine production in Australia.
The increase in product quality related expenses was due mainly to the increase in provisions for recalls andother safety measures resulting from increase in actual payments during fiscal 2015 and the weakening of theJapanese yen against other currencies at the end of fiscal 2015 in comparison to the prior fiscal year. See note 13
to the consolidated financial statements for further discussion.
During fiscal 2015 and beyond, Toyota announced recalls and other safety measures including thefollowing:
In April 2014, Toyota announced in Japan and other regions the voluntary safety recall on certain Toyota
vehicles in relation to the electrical wiring (spiral cable) assembled in the steering column. In April 2014, Toyota
announced in Japan and other regions the voluntary safety recall on certain Toyota vehicles in relation to theslide and lock mechanism of the driver’s seat, the windshield wiper motor and the steering column mounting63

bracket beneath the instrument panel. In June, October, November and December 2014 and in May andJune 2015, Toyota announced in Japan and other regions the voluntary safety recall on certain Toyota and Lexus
vehicles in relation to the driver/front passenger airbag inflator.
The increase in research and development expenses was due mainly to active investments in advanced
technology development to support Toyota’s future growth.
Cost Reduction Efforts
During fiscal 2015, continued cost reduction efforts together with suppliers contributed to a reduction ofoperating costs and expenses by ¥280.0 billion. This was due to ¥220.0 billion in cost reduction efforts
concerning design related costs due mainly to ongoing value engineering activities, and ¥60.0 billion in cost
reduction efforts at plants and logistics department.
These cost reduction efforts related to ongoing value engineering and value analysis activities, the use ofcommon parts resulting in a reduction of part types and other manufacturing initiatives designed to reduce thecosts of vehicle production. The amount of the effect of cost reduction efforts includes the impact of fluctuationin the price of steel, precious metals, non-ferrous alloys including aluminum, plastic parts and other production
materials and parts.
Cost of Products Sold
Cost of products sold increased by ¥928.1 billion, or 4.6%, to ¥20,916.3 billion during fiscal 2015 comparedwith the prior fiscal year. The increase resulted mainly from the ¥691.0 billion unfavorable impact of fluctuations
in foreign currency translation rates, the ¥420.0 billion impact of changes in vehicle unit sales and sales mix, andthe ¥140.0 billion increase in product quality related expenses, partially offset by the ¥280.0 billion impact of
cost reduction efforts and the ¥80.0 billion costs related to ending the vehicle and engine production in Australia
recorded in the prior fiscal year.
Cost of Financing Operations
Cost of financing operations increased by ¥112.4 billion, or 13.8%, to ¥925.3 billion during fiscal 2015
compared with the prior fiscal year. The increase resulted mainly from the ¥90.7 billion unfavorable impact offluctuations in foreign currency translation rates.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased by ¥43.6 billion, or 1.7%, to ¥2,642.2 billion during
fiscal 2015 compared with the prior fiscal year. This increase mainly reflected the ¥113.6 billion unfavorable
impact of fluctuations in foreign currency translation rates, partially offset by the ¥125.0 billion payment to the
U.S government based on the agreement with the U.S. Attorney’s Office for the Southern District of New Yorkto resolve its investigation recorded in the prior fiscal year.
Operating Income
Yen in millions
2015 v. 2014 Change

Changes in operating income and loss:
Effect of changes in exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of increase of miscellaneous costs and others . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
64

280,000
280,000(70,000)(160,000)
128,452
458,452

Toyota’s operating income increased by ¥458.4 billion, or 20.0%, to ¥2,750.5 billion during fiscal 2015
compared with the prior fiscal year. This increase was due mainly to the ¥280.0 billion favorable impact ofchanges in foreign currency exchange rates, and ¥280.0 billion impact of cost reduction efforts, partially offset
by the ¥70.0 billion impact of marketing activities, and ¥160.0 billion increase in miscellaneous costs and others.
The increase in miscellaneous costs and others was due mainly to the ¥140.0 billion increase in product quality
related expenses, the ¥100.0 billion increase in research and development expenses, and ¥80.0 billion increase inlabor costs, partially offset by the ¥125.0 billion payment to the U.S government based on the agreement with the
U.S. Attorney’s Office for the Southern District of New York to resolve its investigation and the ¥83.0 billion
costs related to ending the vehicle and engine production in Australia, both being recorded in the prior fiscal
year.
Marketing efforts and marketing activities include changes in vehicle unit sales and sales mix, sales
expenses and other.
During fiscal 2015, operating income (before elimination of intersegment profits), compared with the priorfiscal year increased by ¥61.3 billion, or 4.1%, in Japan, ¥258.4 billion, or 79.3%, in North America,¥22.8 billion, or 39.3%, in Europe, ¥26.0 billion, or 6.6%, in Asia, and ¥68.9 billion, or 162.0%, in Other.
The following is a description of operating income in each geographic market.
Japan
Yen in millions
2015 v. 2014 Change

Changes in operating income and loss:
Effect of changes in exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of increase of miscellaneous costs and others . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

360,000
195,000(270,000)(225,000)
1,311

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

61,311

North America
Yen in millions
2015 v. 2014 Change

Changes in operating income and loss:
Effect of changes in exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(40,000)
70,000105,000
123,467

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

258,46765

EuropeYen in millions
2015 v. 2014 Change

Changes in operating income and loss:
Effect of changes in exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(10,000)
20,00010,0002,890

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

22,890Asia
Yen in millions
2015 v. 2014 Change

Changes in operating income and loss:
Effect of changes in exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10,00025,000(15,000)
6,045

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

26,045

Other
Yen in millions
2015 v. 2014 Change

Changes in operating income and loss:
Effect of changes in exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of decrease of miscellaneous costs and others . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(40,000)
100,000
35,000(26,059)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

68,941Other Income and Expenses
Interest and dividend income increased by ¥31.7 billion, or 27.5%, to ¥147.1 billion during fiscal 2015
compared with the prior fiscal year.
Interest expense increased by ¥3.2 billion, or 16.5%, to ¥22.8 billion during fiscal 2015 compared with theprior fiscal year.
Foreign exchange gain, net increased by ¥37.8 billion, or 75.4%, to ¥88.1 billion during fiscal 2015
compared with the prior fiscal year. Foreign exchange gains and losses include the differences between the valueof foreign currency denominated assets and liabilities recognized through transactions in foreign currencies
translated at prevailing exchange rates and the value at the date the transaction settled during the fiscal year,
including those settled using forward foreign currency exchange contracts, or the value translated by appropriate
year-end exchange rates. The ¥37.8 billion increase in foreign exchange gain, net was due mainly to the gains
recorded in fiscal 2015 resulting from the Japanese yen being weaker against foreign currencies at the dates ofsettlement of the foreign currency trade accounts receivable than at the dates of the transactions.
66

Other income (loss), net decreased by ¥73.0 billion to a loss of ¥70.1 billion during fiscal 2015 comparedwith the prior fiscal year. The decrease was due mainly to the effect of the reissuance of treasury stock for
Toyota Mobility Foundation, a General Incorporated Foundation. See note 16 to the consolidated financial
statements for further discussion.
Income Taxes
The provision for income taxes increased by ¥125.6 billion, or 16.4%, to ¥893.4 billion during fiscal 2015
compared with the prior fiscal year due mainly to the increase in income before income taxes and equity inearnings of affiliated companies. The effective tax rate for fiscal 2015 was 30.9%, which was lower than thestatutory tax rate in Japan. This was due mainly to the increase in tax credits and the effect of foreign subsidiaries
where statutory tax rates are lower than that of Japan.
Net Income Attributable to Noncontrolling Interests and Equity in Earnings of Affiliated Companies
Net income attributable to noncontrolling interests decreased by ¥33.9 billion, or 20.2%, to ¥134.5 billion
during fiscal 2015 compared with the prior fiscal year. This was due mainly to a decrease during fiscal 2015 in
net income attributable to the shareholders of consolidated subsidiaries.
Equity in earnings of affiliated companies during fiscal 2015 decreased by ¥9.8 billion, or 3.1%, to¥308.5 billion compared with the prior fiscal year. This decrease was due mainly to a decrease during fiscal 2015
in net income attributable to the shareholders of affiliated companies accounted for by the equity method.
Net Income Attributable to Toyota Motor Corporation
Net income attributable to the shareholders of Toyota Motor Corporation increased by ¥350.2 billion, or
19.2%, to ¥2,173.3 billion during fiscal 2015 compared with the prior fiscal year.
Other Comprehensive Income and Loss
Other comprehensive income increased by ¥65.1 billion, or 7.4%, to ¥949.3 billion for fiscal 2015 comparedwith the prior fiscal year. This increase resulted from unrealized holding gains on securities in fiscal 2015 of¥567.0 billion compared with gains of ¥493.7 billion in the prior fiscal year due mainly to an increase in prices ofmarketable securities in stock exchange markets in Japan, and from favorable foreign currency translation
adjustments gains of ¥380.4 billion in fiscal 2015 compared with gains of ¥296.9 billion in the prior fiscal year
due mainly to depreciation of the yen against the U.S. dollar, partially offset by pension liability adjustments infiscal 2015 of ¥1.9 billion compared with gains of ¥93.5 billion in the prior fiscal year.

67

Segment Information
The following is a discussion of the results of operations for each of Toyota’s operating segments. The
amounts presented are prior to intersegment elimination.
Yen in millions
Year ended March 31,
2015 v. 2014 Change
2014
2015
AmountPercentage

Automotive:
Net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Services:
Net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
All Other:
Net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intersegment elimination/unallocated amount:
Net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

23,781,404
1,938,778

25,062,129
2,325,310

1,280,725
386,5325.4%
19.9

1,421,047
294,891

1,661,149
361,833

240,102
66,94216.9
22.7

1,151,280
64,2701,255,791
65,650104,511
1,380

9.1
2.1

(661,820)(5,827)(744,548)(2,229)(82,728)
3,598

—
—

Automotive Operations Segment
The automotive operations segment is Toyota’s largest operating segment by net revenues. Net revenues forthe automotive segment increased during fiscal 2015 by ¥1,280.7 billion, or 5.4%, to ¥25,062.1 billion comparedwith the prior fiscal year. The increase mainly reflects the ¥860.1 billion favorable impact of fluctuations inforeign currency translation rates and the ¥360.0 billion favorable impact of changes in vehicle unit sales andsales mix.
Operating income from the automotive operations increased by ¥386.5 billion, or 19.9%, to ¥2,325.3 billion
during fiscal 2015 compared with the prior fiscal year. This increase in operating income was due mainly to the¥280.0 billion favorable impact of changes in foreign currency exchange rates and the ¥280.0 billion impact of
cost reduction efforts, partially offset by the ¥70.0 billion impact of marketing activities and the ¥160.0 billion
increase in miscellaneous costs and others.
The impact of marketing activities was due primarily to the decrease in Toyota’s vehicle unit sales by
144 thousand vehicles compared with the prior fiscal year. Although the vehicle unit sales in North America
increased due mainly to the market progressing in a steady manner, the vehicle unit sales overall decreased due
mainly to the market downturn in Japan resulting from the consumption tax increase and the market downturn inmajor Asian countries. The increase in miscellaneous costs and others was due mainly to the ¥140.0 billion
increase in product quality related expenses, the ¥100.0 billion increase in research and development expenses
and the ¥80.0 billion increase in labor costs, partially offset by the ¥125.0 billion payment to the U.S government
based on the agreement with the U.S. Attorney’s Office for the Southern District of New York to resolve its
investigation recorded in the prior fiscal year.
Financial Services Operations Segment
Net revenues for the financial services operations increased during fiscal 2015 by ¥240.1 billion, or 16.9%,
to ¥1,661.1 billion compared with the prior fiscal year. This increase was primarily due to the ¥98.2 billion
favorable impact of fluctuations in foreign currency translation rates.
Operating income from financial services operations increased by ¥66.9 billion, or 22.7%, to ¥361.8 billion
during fiscal 2015 compared with the prior fiscal year. This increase was due primarily to the recording of¥61.9 billion of valuation gains on interest rate swaps stated at fair value, mainly in North America.
68All Other Operations Segment
Net revenues for Toyota’s other operations segments increased by ¥104.5 billion, or 9.1%, to¥1,255.7 billion during fiscal 2015 compared with the prior fiscal year.
Operating income from Toyota’s other operations segments increased by ¥1.3 billion, or 2.1%, to¥65.6 billion during fiscal 2015 compared with the prior fiscal year.
Results of Operations — Fiscal 2014 Compared with Fiscal 2013
Yen in millions
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Net revenues:
Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intersegment elimination/unallocated amount . . . . . . . .

12,821,018 14,297,470 1,476,452
6,284,425
8,117,099 1,832,674
2,083,113
2,724,959
641,846
4,385,476
4,877,672
492,1962,094,265
2,336,641
242,376(5,604,105) (6,661,930) (1,057,825)

11.5%
29.2
30.8
11.2
11.6
—

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income:Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intersegment elimination/unallocated amount . . . . . . . .

22,064,192

25,691,911

3,627,719

16.4

576,335
221,925
26,462
376,055
133,744(13,633)

1,510,165
326,052
58,228395,737
42,568(40,638)

933,830
104,127
31,766
19,682(91,176)(27,005)

162.0
46.9
120.0
5.2
(68.2)—

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income before income taxes and equity in earnings ofaffiliated companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net margin from income before income taxes and equity inearnings of affiliated companies . . . . . . . . . . . . . . . . . . . . .
Equity in earnings of affiliated companies . . . . . . . . . . . . . . .
Net income attributable to Toyota Motor Corporation . . . . . .
Net margin attributable to Toyota Motor Corporation . . . . . .

1,320,888
2,292,112
6.0%
8.9%

971,224
2.9%

73.5

1,403,649

2,441,080

6.4%
9.5%
231,519
318,376
962,163
1,823,119
4.4%
7.1%

1,037,431
3.1%
86,857860,956
2.7%

73.9

37.5
89.5

* “Other” consists of Central and South America, Oceania, Africa and the Middle East.
Net Revenues
Toyota had net revenues for fiscal 2014 of ¥25,691.9 billion, an increase of ¥3,627.7 billion, or 16.4%,
compared with the prior fiscal year. This increase mainly reflected the favorable impact of fluctuations in foreign
currency translation rates of ¥2,510.4 billion and changes in vehicle unit sales and sales mix of ¥300.0 billion.
Excluding the impact of changes in the Japanese yen values used for translation purposes of ¥2,510.4 billion, net
revenues would have been ¥23,181.4 billion during fiscal 2014, a 5.1% increase compared with the prior fiscal
year. The automotive market in calendar year 2013 increased by 7.9% in North America and in fiscal 2014
increased by 5.9% in Japan compared with the prior year due to the market in the U.S. and Japan progressing in a
steady manner. Under these automotive market conditions, Toyota’s consolidated vehicle unit sales increased by
2.8% compared with the prior fiscal year to 9,116 thousand vehicles.
69

The table below shows Toyota’s net revenues from external customers by product category and by business.
Yen in millions
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Parts and components for overseas production . . . . . . . . . . . .
Parts and components for after service . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

17,446,473
356,756
1,577,690
997,843

20,353,340
431,760
1,843,478
1,105,277

2,906,867
75,004
265,788
107,434

16.7%
21.0
16.8
10.8

Total Automotive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
All Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

20,378,762
535,388

23,733,855
578,789

3,355,093
43,401

16.5
8.1

Total sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,914,150
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,150,042

24,312,644
1,379,267

3,398,494
229,225

16.2
19.9

25,691,911

3,627,719

16.4%

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

22,064,192

Toyota’s net revenues include net revenues from sales of products, consisting of net revenues fromautomotive operations and all other operations, which increased by 16.2% during fiscal 2014 compared with theprior fiscal year to ¥24,312.6 billion, and net revenues from financial services operations which increased by
19.9% during fiscal 2014 compared with the prior fiscal year to ¥1,379.2 billion. Excluding the impact ofchanges in the Japanese yen values used for translation purposes of ¥2,311.9 billion, net revenues from sales of
products would have been ¥22,000.6 billion during fiscal 2014, a 5.2% increase compared with the prior fiscal
year. The increase in net revenues from sales of products is mainly due to an increase in Toyota vehicle unit salesof 245 thousand vehicles. Excluding the impact of changes in the Japanese yen values used for translation
purposes of ¥198.5 billion, net revenues from financial services operations would have been ¥1,180.7 billion
during fiscal 2014, a 2.7% increase compared with the prior fiscal year.
The following table shows the number of financing contracts by geographic region at the end of fiscal 2014
and 2013, respectively.
Number of financing contracts in thousands
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,765
4,596
825
868
618

1,813
4,791
879
1,167
688

48
195
54
299
70

2.7%
4.3
6.5
34.5
11.3

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8,672

9,338

666

7.7%

* “Other” consists of Central and South America, Oceania and Africa.
Geographically, net revenues (before the elimination of intersegment revenues) for fiscal 2014 increased by
11.5% in Japan, 29.2% in North America, 30.8% in Europe, 11.2% in Asia, and 11.6% in Other compared withthe prior fiscal year. Excluding the impact of changes in the Japanese yen values used for translation purposes of¥2,510.4 billion, net revenues in fiscal 2014 would have increased by 11.5% in Japan, 8.4% in North America,
6.5% in Europe and 5.9% in Other compared with the prior fiscal year, and would have decreased by 4.9% in
Asia compared with the prior fiscal year.

70

The following is a discussion of net revenues in each geographic market (before the elimination ofintersegment revenues).
Japan
Thousands of units
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Toyota’s consolidated vehicle unit sales* . . . . . . . . . . . . . . . .

4,202

4,220

18

0.4%

* including number of exported vehicle unit sales
Yen in millions
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Net revenues:
Sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

12,687,092
133,926

14,179,710
117,760

1,492,618(16,166)

11.8%(12.1)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

12,821,018

14,297,470

1,476,452

11.5%

Toyota’s domestic and exported vehicle unit sales increased by 18 thousand vehicles compared with theprior fiscal year due primarily to favorable market conditions.
North America
Thousands of units
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Toyota’s consolidated vehicle unit sales . . . . . . . . . . . . . . . . .

2,469

2,529

60

2.5%

Yen in millions
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Net revenues:
Sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5,564,183
720,242

7,234,376
882,723

1,670,193
162,481

30.0%
22.6

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6,284,425

8,117,099

1,832,674

29.2%

Net revenues in North America increased due primarily to the 60 thousand vehicles increase in vehicle unit
sales compared with the prior fiscal year. The vehicle unit sales increased due mainly to the market progressing
in a steady manner and strong sales of the RAV4, IS and other new car models.

71

EuropeThousands of units
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Toyota’s consolidated vehicle unit sales . . . . . . . . . . . . . . . . . . . . .

799

844

45

5.6%

Yen in millions
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Net revenues:
Sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,007,207
75,9062,630,408
94,551

623,201
18,64531.0%
24.6

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,083,113

2,724,959

641,846

30.8%

Net revenues in Europe increased due primarily to the 45 thousand vehicles increase in vehicle unit sales
compared with the prior fiscal year. The vehicle unit sales increased due mainly to the strong sales of the RAV4,
Corolla and other car models.
Asia
Thousands of units
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Toyota’s consolidated vehicle unit sales . . . . . . . . . . . . . . . . . . . .

1,684

1,609

(75)

(4.5)%

Yen in millions
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Net revenues:
Sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4,307,943
77,533

4,755,114
122,558

447,171
45,025

10.4%
58.1

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4,385,476

4,877,672

492,196

11.2%

Excluding the favorable impact of fluctuations in foreign currency translation rates, net revenues in Asia
would have decreased due primarily to the 75 thousand vehicles decrease in vehicle unit sales compared with theprior fiscal year. The decrease in vehicle unit sales was due mainly to decreased sales in Thailand and India,
which in turn was due mainly to the shrinking of the market and competitive market conditions.

72

OtherThousands of units
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Toyota’s consolidated vehicle unit sales . . . . . . . . . . . . . . . . .

1,640

1,769

129

7.8%

Yen in millions
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Net revenues:
Sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,942,215
152,050

2,162,505
174,136

220,290
22,086

11.3%
14.5

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,094,265

2,336,641

242,376

11.6%

Net revenues in Other increased due primarily to the 129 thousand vehicles increase in vehicle unit sales
compared with the prior fiscal year. The vehicle unit sales increased due mainly to the strong sales of the Etios inCentral and South America.
Operating Costs and Expenses
Yen in millions
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Operating costs and expenses
Cost of products sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,010,569
Cost of financing operations . . . . . . . . . . . . . . . . . . . . . .
630,426
Selling, general and administrative . . . . . . . . . . . . . . . . .
2,102,309
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

20,743,304

19,988,245
812,8942,598,660

1,977,676
182,468
496,351

11.0%
28.9
23.6

23,399,799

2,656,495

12.8%

Yen in millions
2014 v. 2013 Change

Changes in operating costs and expenses:
Effect of changes in vehicle unit sales and sales mix . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of fluctuation in foreign currency translation rates . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of increase in miscellaneous costs and others . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

120,000
2,378,900(290,000)
447,595

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,656,495

Operating costs and expenses increased by ¥2,656.4 billion, or 12.8%, to ¥23,399.7 billion during fiscal
2014 compared with the prior fiscal year. This increase resulted mainly from the ¥2,378.9 billion unfavorable
impact of fluctuations in foreign currency translation rates, the ¥447.5 billion increase in miscellaneous costs andothers, and the ¥120.0 billion impact of changes in vehicle unit sales and sales mix, partially offset by the¥290.0 billion impact of cost reduction efforts.
The increase in miscellaneous costs and others was due mainly to the ¥125.0 billion payment to the
U.S government based on the agreement with the U.S. Attorney’s Office for the Southern District of New Yorkto resolve its investigation, the ¥100.0 billion increase in labor costs, the ¥100.0 billion increase in research anddevelopment expenses, and the ¥83.0 billion increase in costs related to ending the vehicle and engine production73

in Australia, partially offset by 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. recorded in the prior fiscal year.
Cost Reduction Efforts
During fiscal 2014, Toyota’s continued cost reduction efforts reduced operating costs and expenses by¥290.0 billion. The amount of the effect of cost reduction efforts includes the impact of fluctuation in the price ofsteel, precious metals, non-ferrous alloys including aluminum, plastic parts and other production materials andparts. In fiscal 2014, continued cost reduction efforts together with suppliers contributed to the improvement inearnings. These cost reduction efforts related to ongoing value engineering and value analysis activities, the useof common parts resulting in a reduction of part types and other manufacturing initiatives designed to reduce thecosts of vehicle production.
Cost of Products Sold
Cost of products sold increased by ¥1,977.6 billion, or 11.0%, to ¥19,988.2 billion during fiscal 2014
compared with the prior fiscal year. The increase resulted mainly from the ¥1,866.5 billion unfavorable impact offluctuations in foreign currency translation rates, the ¥105.0 billion impact of changes in vehicle unit sales andsales mix, the ¥100.0 billion increase in research and development expenses, and the ¥80.0 billion increase incosts related to ending the vehicle and engine production in Australia, partially offset by the ¥290.0 billion
impact of cost reduction efforts.
Cost of Financing Operations
Cost of financing operations increased by ¥182.4 billion, or 28.9%, to ¥812.8 billion during fiscal 2014
compared with the prior fiscal year. The increase resulted mainly from the ¥183.0 billion unfavorable impact offluctuations in foreign currency translation rates.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased by ¥496.3 billion, or 23.6%, to ¥2,598.6 billion
during fiscal 2014 compared with the prior fiscal year. This increase mainly reflected the ¥329.3 billion
unfavorable impact of fluctuations in foreign currency translation rates, and the ¥125.0 billion payment to the
U.S government based on the agreement with the U.S. Attorney’s Office for the Southern District of New Yorkto resolve its investigation, partially offset by the ¥90.0 billion charge for costs related to the settlement of theeconomic loss claims in the consolidated federal action in the U.S. recorded in the prior fiscal year.
Operating Income
Yen in millions
2014 v. 2013 Change

Changes in operating income and loss:
Effect of changes in exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of increase of miscellaneous costs and others . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

900,000
290,000
180,000(480,000)
81,224

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

971,224

Toyota’s operating income increased by ¥971.2 billion, or 73.5%, to ¥2,292.1 billion during fiscal 2014
compared with the prior fiscal year. This increase was due mainly to the ¥900.0 billion favorable impact of74

changes in exchange rates, ¥290.0 billion impact of cost reduction efforts, and ¥180.0 billion impact of marketing
efforts, partially offset by the ¥480.0 billion increase in miscellaneous costs and others. The increase in
miscellaneous costs and others was due mainly to the ¥125.0 billion payment to the U.S government based on theagreement with the U.S. Attorney’s Office for the Southern District of New York to resolve its investigation, the¥100.0 billion increase in labor costs, the ¥100.0 billion increase in research and development expenses, and the¥83.0 billion increase in costs related to ending the vehicle and engine production in Australia, partially offset bythe ¥90.0 billion charge for costs related to the settlement of the economic loss claims in the consolidated federal
action in the U.S. recorded in the prior fiscal year.
During fiscal 2014, operating income (before elimination of intersegment profits), compared with the priorfiscal year increased by ¥933.8 billion, or 162.0%, in Japan, ¥104.1 billion, or 46.9%, in North America, ¥31.7
billion, or 120.0%, in Europe, ¥19.6 billion, or 5.2%, in Asia, and decreased by ¥91.1 billion, or 68.2%, in Other.
The following is a description of operating income in each geographic market.
Japan
Yen in millions
2014 v. 2013 Change

Changes in operating income and loss:
Effect of changes in exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of increase of miscellaneous costs and others . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

940,000
175,000
180,000(370,000)
8,830

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

933,830

North America
Yen in millions
2014 v. 2013 Change

Changes in operating income and loss:
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of decrease of miscellaneous costs and others . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

75,000(25,000)
50,0004,127

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

104,127

EuropeYen in millions
2014 v. 2013 Change

Changes in operating income and loss:
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of increase of miscellaneous costs and others . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

15,00025,000(10,000)
1,766

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

31,76675

Asia
Yen in millions
2014 v. 2013 Change

Changes in operating income and loss:
Effect of changes in exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of increase of miscellaneous costs and others . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

25,00035,000(40,000)(50,000)
49,682

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

19,682Other
Yen in millions
2014 v. 2013 Change

Changes in operating income and loss:
Effect of cost reduction efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of marketing efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of increase of miscellaneous costs and others . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(10,000)
40,000(100,000)(21,176)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(91,176)

Other Income and Expenses
Interest and dividend income increased by ¥16.7 billion, or 17.0%, to ¥115.4 billion during fiscal 2014
compared with the prior fiscal year.
Interest expense decreased by ¥3.3 billion, or 14.5%, to ¥19.6 billion during fiscal 2014 compared with theprior fiscal year.
Foreign exchange gain, net increased by ¥44.7 billion, or 805.4%, to ¥50.2 billion during fiscal 2014
compared with the prior fiscal year. Foreign exchange gains and losses include the differences between the valueof foreign currency denominated assets and liabilities recognized through transactions in foreign currencies
translated at prevailing exchange rates and the value at the date the transaction settled during the fiscal year,
including those settled using forward foreign currency exchange contracts, or the value translated by appropriate
year-end exchange rates. The ¥44.7 billion increase in foreign exchange gain, net was due mainly to the losses
recorded in fiscal 2013 resulting from the Japanese yen being stronger against foreign currencies at the time
foreign currency bonds were redeemed during that fiscal year than the Japanese yen at the time of purchase.
Other loss, net increased by ¥1.4 billion, or 94.7%, to ¥2.9 billion during fiscal 2014 compared with theprior fiscal year.
Income Taxes
The provision for income taxes increased by ¥216.1 billion, or 39.2%, to ¥767.8 billion during fiscal 2014
compared with the prior fiscal year due mainly to the increase in income before income taxes and equity inearnings of affiliated companies. The effective tax rate for fiscal 2014 was 31.5%, which was lower than thestatutory tax rate in Japan. This was due mainly to the increase in tax credits and income before income taxes andequity in earnings of affiliated companies from foreign subsidiaries where statutory tax rates are lower than thatof Japan.
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Net Income Attributable to Noncontrolling Interests and Equity in Earnings of Affiliated Companies
Net income attributable to noncontrolling interests increased by ¥47.2 billion, or 38.9%, to ¥168.5 billion
during fiscal 2014 compared with the prior fiscal year. This was due mainly to an increase during fiscal 2014 in
net income attributable to the shareholders of consolidated subsidiaries.
Equity in earnings of affiliated companies during fiscal 2014 increased by ¥86.8 billion, or 37.5%, to¥318.3 billion compared with the prior fiscal year. This increase was due mainly to an increase during fiscal 2014
in net income attributable to the shareholders of affiliated companies accounted for by the equity method.
Net Income Attributable to Toyota Motor Corporation
Net income attributable to the shareholders of Toyota Motor Corporation increased by ¥860.9 billion, or
89.5%, to ¥1,823.1 billion during fiscal 2014 compared with the prior fiscal year.
Other Comprehensive Income and Loss
Other comprehensive income increased by ¥61.5 billion to ¥884.2 billion for fiscal 2014 compared with theprior fiscal year. This increase resulted from unrealized holding gains on securities in fiscal 2014 of¥493.7 billion compared with gains of ¥368.5 billion in the prior fiscal year, and from pension liability
adjustments in fiscal 2014 of ¥93.5 billion compared with gains of ¥19.5 billion in the prior fiscal year, partially
offset by unfavorable foreign currency translation adjustments gains of ¥296.9 billion in fiscal 2014 comparedwith gains of ¥434.6 billion in the prior fiscal year.
Segment Information
The following is a discussion of the results of operations for each of Toyota’s operating segments. The
amounts presented are prior to intersegment elimination.
Yen in millions
Year ended March 31,
2014 v. 2013 Change
2013
2014
AmountPercentage

Automotive:
Net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Services:
Net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
All Other:
Net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intersegment elimination/unallocated amount:
Net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

20,419,100
944,704

23,781,404
1,938,778

3,362,304
994,074

16.5%
105.2

1,170,670
315,820

1,421,047
294,891

250,377(20,929)

21.4
(6.6)

1,066,461
53,616

1,151,280
64,27084,81910,6548.0
19.9(592,039)
6,748(661,820)(5,827)(69,781)(12,575)——

Automotive Operations Segment
The automotive operations segment is Toyota’s largest operating segment by net revenues. Net revenues forthe automotive segment increased during fiscal 2014 by ¥3,362.3 billion, or 16.5%, to ¥23,781.4 billion
compared with the prior fiscal year. The increase mainly reflects the ¥2,304.9 billion favorable impact offluctuations in foreign currency translation rates and the ¥300.0 billion favorable impact of changes in vehicle
unit sales and sales mix.
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Operating income from the automotive operations increased by ¥994.0 billion, or 105.2%, to¥1,938.7 billion during fiscal 2014 compared with the prior fiscal year. This increase in operating income wasdue mainly to the ¥900.0 billion favorable impact of changes in exchange rates, the ¥290.0 billion impact of cost
reduction efforts, and the ¥190.0 billion of favorable impact of changes in vehicle unit sales and sales mix,
partially offset by the ¥480.0 billion increase in miscellaneous costs and others.
The changes in vehicle unit sales and changes in sales mix were due primarily to the increase in Toyota’s
vehicle unit sales by 245 thousand vehicles compared with the prior fiscal year resulting from the increase in
vehicle unit sales in North America, Europe and Other. The increase in miscellaneous costs and others was due
mainly to the ¥125.0 billion payment to the U.S government based on the agreement with the U.S. Attorney’s
Office for the Southern District of New York to resolve its investigation, the ¥100.0 billion increase in laborcosts, the ¥100.0 billion increase in research and development expenses, and the ¥83.0 billion increase in costs
related to ending the vehicle and engine production in Australia, partially offset by the ¥90.0 billion charge forcosts related to the settlement of the economic loss claims in the consolidated federal action in the U.S. recordedin the prior fiscal year.
Financial Services Operations Segment
Net revenues for the financial services operations increased during fiscal 2014 by ¥250.3 billion, or 21.4%,
to ¥1,421.0 billion compared with the prior fiscal year. This increase was primarily due to the ¥199.8 billion
favorable impact of fluctuations in foreign currency translation rates.
Operating income from financial services operations decreased by ¥20.9 billion, or 6.6%, to ¥294.8 billion
during fiscal 2014 compared with the prior fiscal year. This decrease was due primarily to the recording of¥22.0 billion of valuation losses on interest rate swaps stated at fair value.
All Other Operations Segment
Net revenues for Toyota’s other operations segments increased by ¥84.8 billion, or 8.0%, to ¥1,151.2 billion
during fiscal 2014 compared with the prior fiscal year.
Operating income from Toyota’s other operations segments increased by ¥10.6 billion, or 19.9%, to¥64.2 billion during fiscal 2014 compared with the prior fiscal year.
Related Party Transactions
Toyota does not have any significant related party transactions other than transactions with affiliatedcompanies in the ordinary course of business. See note 11 to the consolidated financial statements for further
discussion.
Recent Accounting Pronouncements in the United States
In May 2014, the Financial Accounting Standards Board (“FASB”) issued updated guidance on therecognition of revenue from contracts with customers. This guidance will supersede the current revenue
recognition guidance. This guidance is effective for annual reporting periods beginning after December 15, 2016,
including interim periods within that reporting period. Management is evaluating the impact of adopting thisguidance on Toyota’s consolidated financial statements.
In February 2015, the FASB issued updated guidance that amends the analysis a reporting entity must
perform to determine whether it should consolidate certain legal entities. This guidance is effective for fiscal
years, and for interim periods within those fiscal years, beginning after December 15, 2015. Management isevaluating the impact of adopting this guidance on Toyota’s consolidated financial statements.
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In April 2015, the FASB issued updated guidance that requires debt issuance costs related to a recognizeddebt liability be presented in the balance sheet as a direct deduction from the carrying amount of the related debt
liability instead of being presented as an asset. This guidance is effective for fiscal years beginning after
December 15, 2015, and interim periods within those fiscal years. Management is evaluating the impact of
adopting this guidance on Toyota’s consolidated financial statements.
In April 2015, the FASB issued updated guidance to help entities evaluate the accounting for fees paid by acustomer in a cloud computing arrangement. This guidance is effective for annual periods, including interim
periods within those annual periods, beginning after December 15, 2015. Management is evaluating the impact of
adopting this guidance on Toyota’s consolidated financial statements.
Critical Accounting Estimates
The consolidated financial statements of Toyota are prepared in conformity with accounting principles
generally accepted in the United States of America. The preparation of these financial statements requires the useof estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses during the periods presented. Toyota
believes that of its significant accounting policies, the following may involve a higher degree of judgments,
estimates and assumptions:
Product Warranties and Recalls and Other Safety Measures
Toyota generally warrants its products against certain manufacturing and other defects. Provisions for
product warranties are provided for specific periods of time and/or usage of the product and vary depending upon
the nature of the product, the geographic location of the sale and other factors. All product warranties are
consistent with commercial practices. Toyota includes a provision for estimated product warranty costs as acomponent of cost of sales at the time the related sale is recognized. The accrued warranty costs represent
management’s best estimate at the time of sale of the total costs that Toyota will incur to repair or replace
product parts that fail while still under warranty. The amount of accrued estimated warranty costs is primarily
based on historical experience of product failures as well as current information on repair costs. The amount of
warranty costs accrued also contains an estimate of warranty claim recoveries to be received from suppliers. The
foregoing evaluations are inherently uncertain, as they require material estimates and some products’ warranties
extend for several years. Consequently, actual warranty costs may differ from the estimated amounts and could
require additional warranty provisions. If these factors require a significant increase in Toyota’s accrued
estimated warranty costs, it would negatively affect future operating results of the automotive operations.
An estimate of warranty claim accrued for each fiscal year is calculated based on the estimate of warranty
claim per unit. The estimate of warranty claim per unit is calculated by dividing the actual amounts of warranty
claim, net of claim recovery cost received from suppliers, by the number of sales units for the fiscal year.
As the historical recovery amounts received from suppliers is used as a factor in Toyota’s calculation of
estimated accrued warranty cost, the estimated accrued warranty cost may change depending on the average
recovery amounts received from suppliers in the past. However, Toyota believes that there is not a significant
uncertainty of estimated amounts based on historical experience regarding recoveries received from suppliers.
Toyota may seek recovery to suppliers over the life of the warranty, and there are no other significant special
terms and conditions including cap on amounts that can be recovered.
Toyota accrues for costs of recalls and other safety measures, as well as product warranty cost describedabove, included as a component of cost of sales at the time of vehicle sale. Toyota provides for such “liabilities
for recalls and other safety measures” at the time of vehicle sales comprehensively by aggregate sales of various
models in a certain period by geographical regions instead of by individual models. While there is no differencein the calculation method among geographical regions, Toyota believes it is reasonable to calculate the liabilities
by geographical regions because of factors such as varying labor costs among geographical regions.
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The “liabilities for the costs of recalls and other safety measures” recorded in the balance sheet is calculated
by deducting the “accumulated amount of repair cost paid” from the “expected liability for the cost of recalls andother safety measures”. As such, this liability is evaluated every period based on new data and are adjusted as
appropriate. Toyota calculates these liabilities for units sold in the current period and each of the past 10 fiscal
years, and aggregates such liabilities in determining the final liability amount.
The “expected liability for the cost of recalls and other safety measures” are calculated by multiplying the“sales unit” by the “expected average repair cost per unit”. The “expected average repair cost per unit” iscalculated based on dividing the “accumulated amount of repair cost paid per unit” by the “pattern of payment
occurrences”. The “pattern of payment occurrence” represents a ratio that shows the measure of payment
occurrence over 10 years based on actual payments with regard to units sold within 10 years.
Factors that may cause a difference between the amount accrued at the time of vehicle sale and actual
payment on individual recalls and other safety measures mainly include actual cost of recalls and safety measuresduring the period being significantly different from the accumulated amount of repair cost paid per unit
(generally comprised of parts and labor) and the actual pattern of payment occurrence during the period being
significantly different from the pattern of the payment occurrence in the past, which is considered as part of ourestimation process for future recalls and other safety measures.
As described above, in estimating the comprehensive provision, the actual cost of individual recalls andother safety measures is included as a component of the calculation such as the accumulated amount of repair
cost paid per unit. Thus, an individual recall announcement generally does not directly impact the financial
statements when it occurs.
Allowance for Doubtful Accounts and Credit Losses
Natures of estimates and assumptions
Retail receivables and finance lease receivables consist of retail installment sales contracts secured bypassenger cars and commercial vehicles. Collectability risks include consumer and dealer insolvencies andinsufficient collateral values (less costs to sell) to realize the full carrying values of these receivables. As a matterof policy, Toyota maintains an allowance for doubtful accounts and credit losses representing management’s
estimate of the amount of asset impairment in the portfolios of finance, trade and other receivables. Toyota
determines the allowance for doubtful accounts and credit losses based on a systematic, ongoing review andevaluation performed as part of the credit-risk evaluation process, historical loss experience, the size andcomposition of the portfolios, current economic events and conditions, the estimated fair value and adequacy ofcollateral, and other pertinent factors. This evaluation is inherently judgmental and requires material estimates,
including the amounts and timing of future cash flows expected to be received, which may be susceptible tosignificant change. Although management considers the allowance for doubtful accounts and credit losses to beadequate based on information currently available, additional provisions may be necessary due to (i) changes inmanagement estimates and assumptions about asset impairments, (ii) information that indicates changes in
expected future cash flows, or (iii) changes in economic and other events and conditions. To the extent that sales
incentives remain an integral part of sales promotion with the effect of reducing new vehicle prices, resale prices
of used vehicles and, correspondingly, the collateral value of Toyota’s retail receivables and finance leasereceivables could experience further downward pressure. If these factors require a significant increase in
Toyota’s allowance for doubtful accounts and credit losses, it could negatively affect future operating results ofthe financial services operations. The level of credit losses, which has a greater impact on Toyota’s results ofoperations, is influenced by two factors: frequency of occurrence and expected severity of loss. For evaluation
purposes, exposures to credit losses are segmented into the two primary categories of “consumer” and “dealer”.
Toyota’s “consumer” category consists of smaller balances that are homogenous retail receivables and financelease receivables. The “dealer” category consists of wholesale and other dealer loan receivables. The overall
allowance for credit losses is evaluated at least quarterly, considering a variety of assumptions and factors todetermine whether reserves are considered adequate to cover probable losses.
80Sensitivity analysis
The level of credit losses, which could significantly impact Toyota’s results of operations, is influenced by
two factors: frequency of occurrence and expected severity of loss. The overall allowance for credit losses isevaluated at least quarterly, considering a variety of assumptions and factors to determine whether reserves are
considered adequate to cover probable losses. The following table illustrates the effect of an assumed change infrequency of occurrence or expected severity of loss mainly in the United States, assuming all other assumptions
are held consistent. The table below represents the impact on the allowance for credit losses in Toyota’s financial
services operations of the change in frequency of occurrence or expected severity of loss as any change impacts
most significantly on the financial services operations.
Yen in millions
Effect on the allowancefor credit losses
as of March 31, 201510 percent change in frequency of occurrence or expected severity of loss . . . . . . . . . . . . . .

4,566

Investment in Operating Leases
Natures of estimates and assumptions
Vehicles on operating leases, where Toyota is the lessor, are valued at cost and depreciated over theirestimated useful lives using the straight-line method to their estimated residual values. Toyota utilizes industry
published information and its own historical experience to determine estimated residual values for these vehicles.
Toyota evaluates the recoverability of the carrying values of its leased vehicles for impairment when there areindications of declines in residual values, and if impaired, Toyota recognizes an allowance for losses on its
residual values.
Throughout the life of the lease, management performs periodic evaluations of estimated end-of-term fairvalues to determine whether estimates used in the determination of the contractual residual value are still
considered reasonable. Factors affecting the estimated residual value at lease maturity include, but are not limited
to, new vehicle incentive programs, new vehicle pricing, used vehicle supply, projected vehicle return rates, andprojected loss severity. The vehicle return rate represents the number of leased vehicles actually returned atcontract maturity as a percentage of the number of lease contracts originally scheduled to mature in the same
period less lease contracts subject to early terminations. A higher rate of vehicle returns exposes Toyota to higher
potential losses incurred at lease termination. Severity of loss is the extent to which the end-of-term fair value ofa lease is less than its carrying value at lease end.
To the extent that sales incentives remain an integral part of sales promotion, resale prices of used vehicles
and, correspondingly, the fair value of Toyota’s leased vehicles could be subject to downward pressure. The
extent of the impact this will have on the end of term residual value depends on the significance of the incentive
programs and whether they are sustained over a number of periods. This in turn can impact the projection of
future used vehicle values, adversely impacting the expected residual value of the current operating leaseportfolio and increasing the provision for residual value losses. However, various other factors impact used
vehicle values and the projection of future residual values, including the supply of and demand for used vehicles,interest rates, inflation, the actual or perceived quality, safety and reliability of vehicles, the general economic
outlook, new vehicle pricing, projected vehicle return rates and projected loss severity, which may offset thiseffect. Such factors may adversely affect the results of operations for financial services due to significant charges
reducing the estimated residual value.

81

Sensitivity analysis
The following table illustrates the effect of an assumed change in the vehicle return rate and end-of-term
market values mainly in the United States, which Toyota believes are the critical estimates, in determining theresidual value losses, holding all other assumptions constant. The following table represents the impact on theresidual value losses in Toyota’s financial services operations of the change in vehicle return rate and end-ofterm market values as those changes have a significant impact on financial services operations.
Yen in millions
Effect on the residual value losses
over the remaining termsof the operating leases
on and after April 1, 2015

1 percent increase in vehicle return rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1 percent increase in end-of-term market values . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,803
9,373

Impairment of Long-Lived Assets
Toyota periodically reviews the carrying value of its long-lived assets held and used and assets to bedisposed of, including intangible assets, when events and circumstances warrant such a review. This review isperformed using estimates of future cash flows. If the carrying value of a long-lived asset is considered impaired,an impairment charge is recorded for the amount by which the carrying value of the long-lived asset exceeds its
fair value. Management believes that the estimates of future cash flows and fair values are reasonable. However,changes in estimates of such cash flows and fair values would affect the evaluations and negatively affect future
operating results of the automotive operations. In fiscal 2014, Toyota recorded long-lived assets impairment
charges relating to the end of production in Australia and in fiscal 2015, recorded additional charges. See note 27
to the consolidated financial statements for further discussion.
Pension Costs and Obligations
Natures of estimates and assumptions
Pension costs and obligations are dependent on assumptions used in calculating such amounts. Theseassumptions include discount rates, benefits earned, interest costs, expected rate of return on plan assets,mortality rates and other factors. Actual results that differ from the assumptions are accumulated and amortizedover future periods and, therefore, generally affect recognized expense in future periods. While management
believes that the assumptions used are appropriate, differences in actual experience or changes in assumptions
may affect Toyota’s pension costs and obligations.
The two most critical assumptions impacting the calculation of pension costs and obligations are thediscount rates and the expected rates of returns on plan assets. Toyota determines the discount rates mainly basedon the rates of high quality fixed income bonds or fixed income governmental bonds currently available andexpected to be available during the period to maturity of the defined benefit pension plans. Toyota determines the
expected rates of return for pension assets after considering several applicable factors including, the compositionof plan assets held, assumed risks of asset management, historical results of the returns on plan assets, Toyota’s
principal policy for plan asset management, and forecasted market conditions. A weighted-average discount rateof 1.4% domestically and 4.8% overseas and a weighted-average expected rate of return on plan assets of 2.5%
domestically and 6.7% overseas are the results of assumptions used for the various pension plans in calculating
Toyota’s consolidated pension costs for fiscal 2015. Also, a weighted-average discount rate of 1.1% domesticallyand 4.0% overseas is the result of assumption used for the various pension plans in calculating Toyota’s
consolidated pension obligations for fiscal 2015.

82

Sensitivity analysis
The following table illustrates the effects of assumed changes in weighted-average discount rates and theweighted-average expected rate of return on plan assets, which Toyota believes are critical estimates indetermining pension costs and obligations, assuming all other assumptions are consistent.
Yen in millions
Domestic
Overseas
Effect on pre-tax income Effect on obligations Effect on pre-tax income Effect on obligations
for the year ended
for the year ended
for the year ended
for the year ended
March 31, 2016
March 31, 2015
March 31, 2016
March 31, 2015

Discount rates
0.5% decrease . . . . .
0.5% increase . . . . . .
Expected rate of return onplan assets
0.5% decrease . . . . .
0.5% increase . . . . . .

(8,040)7,750

133,768(123,317)(7,239)7,239(6,735)
6,402

85,189(78,241)(3,568)
3,568

Derivatives and Other Contracts at Fair Value
Toyota uses derivatives in the normal course of business to manage its exposure to foreign currency
exchange rates and interest rates. The accounting for derivatives is complex and continues to evolve. Toyota
estimates the fair value of derivative financial instruments using industry-standard valuation models that require
observable inputs including interest rates and foreign exchange rates, and the contractual terms. In other certain
cases when market data is not available, key inputs to the fair value measurement include quotes fromcounterparties, and other market data. These estimates are based upon valuation methodologies deemed
appropriate under the circumstances. However, the use of different assumptions may have a material effect on theestimated fair value amounts.
Marketable Securities and Investments in Affiliated Companies
Toyota’s accounting policy is to record a write-down of such investments to net realizable value when adecline in fair value below the carrying value is other-than-temporary. In determining if a decline in value isother-than-temporary, Toyota considers the length of time and the extent to which the fair value has been lessthan the carrying value, the financial condition and prospects of the company and Toyota’s ability and intent toretain its investment in the company for a period of time sufficient to allow for any anticipated recovery in fairvalue.
Reissuance of treasury stock for Toyota Mobility Foundation, a General Incorporated Foundation
Toyota Motor Corporation reissued treasury stock for Toyota Mobility Foundation, a General Incorporated
Foundation (the “Foundation”), and the difference between amount of proceeds and fair value of treasury stock
on reissuance was included in “Other income (expense)”. The fair value of treasury stock was measured using adividend discount model due to the restrictions on transfer in the reissued stock for the Foundation. Theseestimates are based upon valuation methodologies deemed appropriate under the circumstances. See note 16 to
the consolidated financial statements for further discussion.
Deferred Tax Assets
The factors used to assess the likelihood of realization of the deferred tax assets are the future reversal ofexisting taxable temporary differences, the future taxable income and available tax planning strategies that are
prudent and feasible. All available evidence, both positive and negative, is considered to determine whether,based on the weight of that evidence, a valuation allowance is needed for deferred tax assets which are not morelikely-than-not to be realized.
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The accounting for deferred tax assets represents Toyota’s current best estimate based on all available
evidence. Unanticipated events or changes could result in re-evaluating the realizability of deferred tax assets.
OutlookAs for our future business environment, in the world economy, the U.S. is expected to recover steadily. Also
the European economy is picking up gradually chiefly in the eurozone, while the economies of several countries
are likely to slow down, such as in Russia which is weighed down by declines in crude oil prices. Emerging
countries also show downside risk. The Japanese economy is expected to recover gradually throughimprovements in employment and income conditions, although attention needs to be paid to for example
uncertainty in overseas economies.
The automotive market is expected to expand gradually, mainly in the U.S. However, amid adaptation of
eco-car promotion policies in various countries and increased efforts toward the development of safety
technologies, as well as continuing advances in information and communication technology, fierce competition
exists on a global scale. In light of the foregoing external factors, Toyota expects that net revenues for fiscal 2016
will increase compared with fiscal 2015 due to price revisions and other factors, partially offset by a decrease in
vehicle unit sales. Toyota expects that operating income will increase in fiscal 2016 compared with fiscal 2015
due mainly to the favorable impact of cost reduction efforts and marketing efforts, partially offset by an increasein miscellaneous costs. Toyota expects that income before income taxes and equity in earnings of affiliatedcompanies and net income attributable to Toyota Motor Corporation will also increase in fiscal 2016.
For the purposes of this outlook discussion, Toyota is assuming an average exchange rate of ¥115 to the
U.S. dollar and ¥125 to the euro. Exchange rate fluctuations can materially affect Toyota’s operating results. In
particular, a strengthening of the Japanese yen against the U.S. dollar can have a material adverse effect on
Toyota’s operating results. See “Operating and Financial Review and Prospects — Operating Results —Overview — Currency Fluctuations” for further discussion.
The foregoing statements are forward-looking statements based upon Toyota’s management’s assumptions
and beliefs regarding exchange rates, market demand for Toyota’s products, economic conditions and others. See“Cautionary Statement Concerning Forward-Looking Statements”. Toyota’s actual results of operations could
vary significantly from those described above as a result of unanticipated changes in the factors described aboveor other factors, including those described in “Risk Factors”.
5.B LIQUIDITY AND CAPITAL RESOURCES
Historically, Toyota has funded its capital expenditures and research and development activities throughcash generated by operations.
In fiscal 2016, Toyota expects to sufficiently fund its capital expenditures and research and development
activities through cash and cash equivalents on hand, and cash generated by operations. Toyota will use its funds
for the development of environment technologies, maintenance and replacement of manufacturing facilities, andthe introduction of new products. See “Information on the Company — Business Overview — Capital
Expenditures and Divestitures” for information regarding Toyota’s material capital expenditures and divestitures
for fiscal 2013, 2014 and 2015, and information concerning Toyota’s principal capital expenditures anddivestitures currently in progress.
Toyota funds its financing programs for customers and dealers, including loans and leasing programs, fromboth cash generated by operations and borrowings by its sales finance subsidiaries. Toyota seeks to expand its
ability to raise funds locally in markets throughout the world by expanding its network of finance subsidiaries.
Net cash provided by operating activities increased by ¥39.7 billion to ¥3,685.7 billion for fiscal 2015,
compared with ¥3,646.0 billion for fiscal 2014.
84

The increase was primarily attributable to the ¥458.4 billion increase in operating income and the ¥158.2
billion increase in depreciation charges, i.e. noncash expenses, resulting from an increase in capital expenditures.
Results of operations are recorded on an accrual basis and are therefore different from cash provided or used inoperating activities. Accordingly the ¥52.4 billion decrease in accrued trade receivables resulting from a decreasein vehicle unit sales in March in Japan and ¥84.7 billion increase in accrued accounts payables resulting from theconsumption tax increase in Japan are attributed to the increase in net cash provided by operating activities. On
the other hand the ¥734.6 billion increase in cash payments for income taxes for fiscal 2015 resulting from anincrease of provisional tax payment partially offset the increase.
Net cash provided by operating activities increased by ¥1,194.7 billion to ¥3,646.0 billion for fiscal 2014,
compared with ¥2,451.3 billion for fiscal 2013. The increase was primarily attributable to the ¥971.2 billion
increase in operating income. This increase in operating income was due mainly to the ¥900.0 billion favorable
impact of changes in exchange rates, the ¥290.0 billion impact of cost reduction efforts and the ¥180.0 billion
impact of marketing efforts, partially offset by the ¥480.0 billion increase in miscellaneous costs and others.
Results of operations are recorded on an accrual basis and are therefore different from cash provided or usedin operating activities. Other than operating income, the increase of net cash provided by operating activities wasprimarily attributable to the ¥438.5 billion increase in “accrued income taxes” for fiscal 2014 resulting from theincrease in income before income taxes, compared with an increase of ¥22.1 billion for fiscal 2013 resulting fromthe increase in income before income taxes that was partially offset by the usage of operating loss carryforwards.
The increase in “accrued income taxes” in fiscal 2014 was partially offset by the ¥160.0 billion in “deferredincome taxes” for fiscal 2013 mainly due to the usage of operating loss carryforwards.
Net cash used in investing activities decreased by ¥522.7 billion to ¥3,813.4 billion for fiscal 2015,
compared with ¥4,336.2 billion for fiscal 2014. The decrease was primarily attributable to the ¥907.6 billion
decrease in purchases of marketable securities and security investments, partially offset by the ¥502.5 billion
increase in purchases of equipment leased to others.
Net cash used in investing activities increased by ¥1,308.9 billion to ¥4,336.2 billion for fiscal 2014,
compared with ¥3,027.3 billion for fiscal 2013. The increase was primarily attributable to the ¥675.6 billion
increase in purchases of marketable securities and security investments and to the ¥589.0 billion increase inpurchases of equipment leased to others.
Net cash provided by financing activities decreased by ¥613.4 billion to ¥306.0 billion for fiscal 2015,
compared with ¥919.4 billion for fiscal 2014. The decrease was primarily attributable to the ¥158.9 billion
increase in dividends paid and the ¥356.9 billion increase in repurchase and reissuance of treasury stock. In
addition, the increase in payments of debt exceeded the increase in proceeds from issuance of debt.
Net cash provided by financing activities increased by ¥442.2 billion to ¥919.4 billion for fiscal 2014,
compared with ¥477.2 billion for fiscal 2013. The increase was primarily attributable to the ¥699.0 billion
increase in proceeds from issuance of long-term debt, partially offset by the ¥306.7 billion increase in paymentsof long-term debt.
Total capital expenditures for property, plant and equipment, excluding vehicles and equipment on operatingleases, were ¥1,146.3 billion during fiscal 2015, an increase of 18.2% from the ¥970.0 billion in total capital
expenditures during the prior fiscal year. This increase was due primarily to an increase in investments in Japan
and North America.
Total capital expenditures for vehicles and equipment on operating leases were ¥2,211.2 billion during fiscal
2015, an increase of 29.4% from the ¥1,708.6 billion in total capital expenditures during the prior fiscal year.
This increase was due primarily to an increase in investments in the financial services operations.
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Toyota expects investments in property, plant and equipment, excluding vehicles and equipment on
operating leases, to be approximately ¥1,200.0 billion during fiscal 2016.
Cash and cash equivalents were ¥2,284.5 billion as of March 31, 2015. Most of Toyota’s cash and cash
equivalents are held in Japanese yen or in U.S. dollars. In addition, time deposits were ¥149.3 billion andmarketable securities were ¥2,782.0 billion as of March 31, 2015.
Liquid assets, which Toyota defines as cash and cash equivalents, time deposits, marketable debt securities
and its investment in monetary trust funds, increased during fiscal 2015 by ¥1,176.9 billion, or 13.4%, to¥9,936.0 billion.
Trade accounts and notes receivable, less allowance for doubtful accounts increased during fiscal 2015 by¥72.4 billion, or 3.6%, to ¥2,108.6 billion. This increase was due mainly to the fluctuations in foreign currencytranslation rates.
Inventories increased during fiscal 2015 by ¥242.9 billion, or 12.8%, to ¥2,137.6 billion. This increase wasdue mainly to the fluctuations in foreign currency translation rates.
Total finance receivables, net increased during fiscal 2015 by ¥1,741.1 billion, or 12.7%, to ¥15,472.3
billion. This increase was due mainly to the fluctuations in foreign currency translation rates and an increase in
the number of financing contracts. As of March 31, 2015, finance receivables were geographically distributed asfollows: in North America 59.3%, in Asia 12.8%, in Europe 9.5%, in Japan 7.9% and in Other 10.5%.
Marketable securities and other securities investments, including those included in current assets, increased
during fiscal 2015 by ¥1,602.3 billion, or 18.2%, reflecting an increase in the fair values of common stocks andpurchase of marketable securities and security investments.
Property, plant and equipment increased during fiscal 2015 by ¥1,654.4 billion, or 21.7%, primarilyreflecting fluctuations in foreign currency translation rates and the increase in the capital expenditures, partially
offset by the impacts of depreciation charges during the year.
Accounts and notes payable increased during fiscal 2015 by ¥197.3 billion, or 8.9%. This increase was due
mainly to the increase in the consumption tax in Japan.
Accrued expenses increased during fiscal 2015 by ¥355.5 billion, or 15.4%. This increase was due mainly tothe increase in product quality related expenses.
Income taxes payable decreased during fiscal 2015 by ¥246.0 billion, or 41.4%. This decrease was due
mainly to an increase in provisional tax payment.
Toyota’s total borrowings increased during fiscal 2015 by ¥2,650.4 billion, or 16.2%. Toyota’s short-termborrowings consist of loans with a weighted-average interest rate of 2.83% and commercial paper with aweighted-average interest rate of 0.41%. Short-term borrowings increased during fiscal 2015 by ¥217.3 billion,
or 4.5%, to ¥5,048.1 billion. Toyota’s long-term debt consists of unsecured and secured loans, medium-term
notes, unsecured and secured notes and long-term capital lease obligations with interest rates ranging from 0.01%
to 41.79%, and maturity dates ranging from 2015 to 2047. The current portion of long-term debt increased during
fiscal 2015 by ¥965.6 billion, or 32.7%, to ¥3,915.3 billion and the non-current portion increased by¥1,467.4 billion, or 17.2%, to ¥10,014.3 billion. The increase in total borrowings resulted mainly from anincrease in medium-term notes. As of March 31, 2015, approximately 48% of long-term debt was denominated in
U.S. dollars, 12% in Japanese yen, 8% in Australian dollars, and 32% in other currencies. Toyota hedges interest
rate risk exposure of fixed-rate borrowings by entering into interest rate swaps. There are no material seasonalvariations in Toyota’s borrowings requirements.
86As of March 31, 2015, Toyota’s total interest bearing debt was 113.0% of Toyota Motor Corporation
shareholders’ equity, compared with 112.8% as of March 31, 2014.
The following table provides information for credit rating of Toyota’s short-term borrowing and long-term
debt from rating agencies, Standard & Poor’s Ratings Group (S&P), Moody’s Investors Services (Moody’s), andRating and Investment Information, Inc. (R&I), as of May 31, 2015. A credit rating is not a recommendation tobuy, sell or hold securities. A credit rating may be subject to withdrawal or revision at any time. Each rating
should be evaluated separately of any other rating.
Short-term borrowing . . . . .
Long-term debt . . . . . . . . . .

S&P

Moody’s

R&I

A-1+
AA-

P-1
Aa3

—
AA+

Toyota’s unfunded pension liabilities of Japanese plans decreased during fiscal 2015 by ¥139.6 billion, or
33.8%, to ¥273.4 billion. The liabilities of foreign plans increased during fiscal 2015 by ¥138.8 billion, or
111.4%, to ¥263.4 billion. The unfunded amounts will be funded through future cash contributions by Toyota or
in some cases will be settled on the retirement date of each covered employee. The decrease in unfunded pension
liabilities of the Japanese plans as of the end of fiscal 2015 compared with the prior fiscal year end reflects
mainly an increase in pension assets due to an increase in equity security prices, despite an increase in pension
benefit obligations that resulted from a decline in discount rate. The increase in unfunded pension liabilities offoreign plans reflects mainly an increase in pension benefit obligations that resulted from a decline in discountrate. See note 19 to the consolidated financial statements for further discussion.
Toyota’s treasury policy is to maintain controls on all exposures, to adhere to stringent counterparty credit
standards, and to actively monitor marketplace exposures. Toyota remains centralized, and is pursuing global
efficiency of its financial services operations through Toyota Financial Services Corporation.
The key element of Toyota’s financial strategy is maintaining a strong financial position that will allow
Toyota to fund its research and development initiatives, capital expenditures and financial services operations
efficiently even if earnings are subject to short-term fluctuations. Toyota believes that it maintains sufficientliquidity for its present requirements and that by maintaining its high credit ratings, it will continue to be able toaccess funds from external sources in large amounts and at relatively low costs. Toyota’s ability to maintain its
high credit ratings is subject to a number of factors, some of which are not within Toyota’s control. These factors
include general economic conditions in Japan and the other major markets in which Toyota does business, aswell as Toyota’s successful implementation of its business strategy.
5.C RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES
Toyota’s research and development is dedicated to capturing the increasingly diverse and sophisticatedmarket through 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 tomaximize its corporate value. For a more detailed discussion of the company’s research and development
objectives and policies, see “Information on the Company — Business Overview — Research andDevelopment”.
Toyota’s research and development expenditures were approximately ¥1,004.5 billion in fiscal 2015, ¥910.5
billion in fiscal 2014 and ¥807.4 billion in fiscal 2013.
Toyota operates a global research and development organization with the primary goal of building
automobiles that meet the needs of customers in every region of the world. In Japan, research and development
operations are led by Toyota and 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, Toyota has a worldwide network of technicalcenters as well as design and motorsports research and development centers.
87

The following table provides information on Toyota’s principal research and development facilities.
Facility

Principal Activity

Japan
Toyota Technical Center . . . . . . . . . . . . . . . .

Product planning, style, design and evaluation

Higashi-Fuji Technical Center . . . . . . . . . . .

Advanced research and development

Tokyo Design Research & Laboratory . . . . .

Research of advanced styling designs

Shibetsu Proving Ground . . . . . . . . . . . . . . .

Vehicle testing and evaluation

Toyota Central R&D Labs., Inc. . . . . . . . . . .

Basic research

United States
Toyota Motor Engineering andManufacturing North America, Inc. . . . . .

North American production and product planning,
upper body planning, evaluation

Calty Design Research, Inc. . . . . . . . . . . . . .

DesignToyota Research Institute of North America(TRI-NA) . . . . . . . . . . . . . . . . . . . . . . . . .

Advanced research relating to “energy and environment”,“safety” and “mobility infrastructure”

EuropeToyota Motor Europe NV/SA . . . . . . . . . . . .

Upper body planning for European production, evaluation
and advanced research

Toyota Europe Design Development
S.A.R.L. . . . . . . . . . . . . . . . . . . . . . . . . . .

DesignToyota Motorsport GmbH . . . . . . . . . . . . . .

Development of motor sports vehicles

Asia PacificToyota Motor Asia Pacific Engineering andManufacturing Co., Ltd. . . . . . . . . . . . . . .

Production, planning and evaluation of vehicles that are
produced in Australia and Asia

Toyota Technical Center Asia Pacific
Australia Pty, Ltd. . . . . . . . . . . . . . . . . . . .

Production, planning and evaluation of vehicles that are
produced in Australia and Asia

China
Toyota Motor Engineering andManufacturing (China) Co., Ltd. . . . . . . .

Research of new, low-energy vehicle technology, vehicle
evaluation and quality assurance in China

FAW Toyota Research & Development Co.,Ltd . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Design and evaluation of vehicles manufactured in China

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

Design and evaluation of vehicles manufactured in China

Toyota decided to reorganize its subsidiary and vehicle development partner Toyota Technical Development
Corporation, integrating its vehicle development functions into Toyota from January 2016.
Toyota carefully analyzes patents and the need for patents in each area of research to formulate more
effective research and development strategies. Toyota identifies research and development projects in which it
should acquire patents, and files relevant applications as necessary to help build a strong global patent portfolio.
In addition, Toyota wishes to contribute to sustainable mobility by promoting the spread of technologies
with environmental and safety benefits. This is why Toyota takes an open stance to patent licensing and grants
licenses when appropriate terms are met. For example, in March 2004, Toyota and Ford Motor Company entered88

into licensing agreements for patents related to hybrid systems and emissions purification. In addition, in
March 2010, Toyota and Mazda Motor Corporation entered into a licensing agreement regarding the supply of
hybrid system technology.
Toyota does not consider any one group of patents or licenses to be so important that their expiration or
termination would materially affect Toyota’s business. For a further discussion of Toyota’s intellectual property,
see “Information on the Company — Business Overview — Intellectual Property”.
5.D TREND INFORMATION
For a discussion of the trends that affect Toyota’s business and operating results, see “— Operating Results”
and “— Liquidity and Capital Resources”.
5.E OFF-BALANCE SHEET ARRANGEMENTS
Toyota uses its securitization program as part of its funding through special purpose entities for its financial
services operations. Toyota is considered as the primary beneficiary of these special purpose entities andtherefore consolidates them. Toyota has not entered into any off-balance sheet securitization transactions during
fiscal 2015.
Lending Commitments
Credit Facilities with Credit Card Holders
Toyota’s financial services operations issue credit cards to customers. As customary for credit cardbusinesses, Toyota maintains credit facilities with holders of credit cards issued by Toyota. These facilities areused upon each holder’s requests up to the limits established on an individual holder’s basis. Although loans
made to customers through these facilities are not secured, for the purposes of minimizing credit risks and of
appropriately establishing credit limits for each individual credit card holder, Toyota employs its own risk
management policy which includes an analysis of information provided by financial institutions in alliance with
Toyota. Toyota periodically reviews and revises, as appropriate, these credit limits. Outstanding credit facilities
with credit card holders were ¥226.0 billion as of March 31, 2015.
Credit Facilities with Dealers
Toyota’s financial services operations maintain credit facilities with dealers. These credit facilities may be
used for business acquisitions, facilities refurbishment, real estate purchases, and working capital requirements.
These loans are typically collateralized with liens on real estate, vehicle inventory, and/or other dealership assets,
as appropriate. Toyota obtains a personal guarantee from the dealer or corporate guarantee from the dealershipwhen deemed prudent. Although the loans are typically collateralized or guaranteed, the value of the underlying
collateral or guarantees may not be sufficient to cover Toyota’s exposure under such agreements. Toyota
evaluates the credit facilities according to the risks assumed in entering into the credit facility. Toyota’s financial
services operations also provide financing to various multi-franchise dealer organizations, referred to as dealer
groups, often as part of a lending consortium, for wholesale inventory financing, business acquisitions, facilities
refurbishment, real estate purchases, and working capital requirements. Toyota’s outstanding credit facilities withdealers totaled ¥2,122.5 billion as of March 31, 2015.
Guarantees
Toyota enters into certain guarantee contracts with its dealers to guarantee customers’ payments of theirinstallment payables that arise from installment contracts between customers and Toyota dealers, as and whenrequested by Toyota dealers. Guarantee periods are set to match the maturity of installment payments, and as ofMarch 31, 2015, ranged from one month to 35 years. However, they are generally shorter than the useful lives of
products sold. Toyota is required to execute its guarantee primarily when customers are unable to make required
payments.
89

The maximum potential amount of future payments as of March 31, 2015 is ¥2,238.1 billion. Liabilities forthese guarantees of ¥6.5 billion have been provided as of March 31, 2015. Under these guarantee contracts,
Toyota is entitled to recover any amounts paid by it from the customers whose obligations it guaranteed.
5.F TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONSContractual Obligations and Commitments
For information regarding debt obligations, capital lease obligations, operating lease obligations and otherobligations, including amounts maturing in each of the next five years, see notes 12, 22 and 23 to theconsolidated financial statements. In addition, as part of Toyota’s normal business practices, Toyota enters into
long-term arrangements with suppliers for purchases of certain raw materials, components and services. Thesearrangements may contain fixed/minimum quantity purchase requirements. Toyota enters into such arrangements
to facilitate an adequate supply of these materials and services.
The following tables summarize Toyota’s contractual obligations and commercial commitments as ofMarch 31, 2015.
Yen in millions
Payments Due by PeriodLess than
1 to
3 to
1 year
3 years
5 years

5 years
and after

1,167,792
3,880,396
13,910,240

1,167,792
3,880,396
3,911,561——
5,243,960——
3,405,863——
1,348,856

888,312
19,459280,648
3,743

351,072
4,629

157,301
2,860

99,291
8,227

76,374

14,76522,883

12,82225,904

325,555

104,72152,73452,577

115,523

20,268,128

9,363,626

5,675,278

3,631,423

1,597,801

Total

Contractual Obligations:Short-term borrowings (note 12)
Loans . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commercial paper . . . . . . . . . . . . . . . . .
Long-term debt* (note 12) . . . . . . . . . . . . . .
Estimated amount of interest expense on
long-term debt . . . . . . . . . . . . . . . . . . . . . .
Capital lease obligations (note 22) . . . . . . . .
Non-cancelable operating lease obligations(note 22) . . . . . . . . . . . . . . . . . . . . . . . . . .
Commitments for the purchase of property,
plant, other assets and services(note 23) . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . .

* “Long-term debt” represents future principal payments.
Toyota is unable to make reasonable estimates of the period of cash settlement with respect to liabilities
recognized for uncertain tax benefits, and accordingly such liabilities are excluded from the table above. Seenote 15 to the consolidated financial statements for further discussion.
Toyota expects to contribute ¥37,836 million domestically and ¥13,452 million overseas to its pension plansin fiscal 2016.

Total
Amounts
Committed

Yen in millions
Amount of Commitment Expiration Per PeriodLess than
1 to
3 to
5 years
1 year
3 years
5 years
and after

Commercial Commitments (note 23):
Maximum potential exposure to guarantees
given in the ordinary course ofbusiness . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,238,185

553,530

927,723495,769

261,163

Total Commercial Commitments . . . . .

2,238,185

553,530

927,723495,769

261,16390

5.G SAFE HARBOR
All information that is not historical in nature disclosed under “— Off-Balance Sheet Arrangements” and“— Tabular Disclosure of Contractual Obligations” is deemed to be a forward-looking statement. See“Cautionary Statement Concerning Forward-Looking Statements” for additional information.
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
6.A DIRECTORS AND SENIOR MANAGEMENTIn March 2011, Toyota unveiled its “Toyota Global Vision”. In order to realize the Toyota Global Vision,
Toyota implemented a new management organization highlighted by a more streamlined board of directors and areduced number of layers in the executive decision-making structure.
In April 2013, Toyota implemented organizational changes in order to further increase the speed ofdecision-making through clarification of operations and earnings responsibility. Specifically, Toyota’s
automotive business was split into four business units. These business units are “Lexus International,” which
covers the Lexus business, “Toyota No. 1,” which covers North America, Europe and Japan, “Toyota No. 2,”
which covers China, Asia & Middle East, East Asia & Oceania, Africa and Latin America & Caribbean and“Unit Center,” which covers all unit-related operations. Toyota’s executive vice presidents are assigned to each
operation and each is responsible for the operations and earnings of the respective business unit. Furthermore, inorder to achieve sustainable growth through the continuous development of “even-better cars” that exceed
customer expectations around the world, and to realize the Toyota Global Vision, the TNGA Planning Division,an organization directly under Toyota’s top management, was established in order to rapidly promote theimplementation of the TNGA. In April 2014, the Strategic Top Executive Meeting Office was established to set
policies concerning medium to long term strategies and business direction, the fundamentals of corporate
strategy. In April 2015, as a result of a review of the geographic oversight of operations, the Africa region wastransferred from Business Unit Toyota No. 2 to Business Unit Toyota No. 1.
Toyota believes it is crucial for it to be led by members of the board of directors and senior management
who deeply understand, and can effectively implement, Toyota’s strengths — the monozukuri spirit ofconscientious manufacturing and the genchi genbutsu principle of placing emphasis on on-site operations with ago-and-see attitude for continued improvement and problem solving. At the 109th Ordinary General
Shareholders’ Meeting held in June 2013, three outside members of the board of directors were appointed inorder to further reflect the opinions of those from outside the company in management’s decision-making
process. Toyota has six audit & supervisory board members, three of whom are outside audit & supervisoryboard members. At the 110th Ordinary General Shareholders’ Meeting held in June 2014, in order to be preparedin the event Toyota lacks the number of audit & supervisory board members required by law, one substituteaudit & supervisory board member was appointed pursuant to Article 329, Paragraph 2 of the Companies Act. In
April 2015, with the aim of enhancing operational oversight and further increasing the speed of decision-making
and execution of operations, the responsibility for executive vice presidents was changed to making decisions
regarding management from a medium to long-term perspective and supervising execution of operations, withexecutives at senior managing officer level and below now responsible for execution of operations, such as
business units, regional operations and key functions. In addition, at the 111th Ordinary General Meeting of
Shareholders held in June 2015, the first non-Japanese executive vice president was appointed in order topromote diversity.

91Set forth below are brief summaries of Toyota’s members of board of directors and audit & supervisoryboard members.
Name(Date of birth)

Position

Brief career summary and important concurrent duties

Takeshi Uchiyamada Chairman of the Board 1969 Joined Toyota Motor Corporation (“TMC”)(August 17, 1946)
of Directors
1998 Member of the Board of Directors of TMC
2001 Managing Director of TMC
2003 Senior Managing Director of TMC
2005 Executive Vice President of TMC
2012 Vice Chairman of TMC
2013 Chairman of TMC
Akio Toyoda(May 3, 1956)

President,
Member of the Boardof Directors

1984 Joined TMC
2000 Member of the Board of Directors of TMC
2002 Managing Director of TMC
2003 Senior Managing Director of TMC
2005 Executive Vice President of TMC
2009 President of TMC

Number of
Shares47,5394,596,475(important concurrent duties)
Chairman and CEO of Toyota Motor North
America, Inc.
Chairman of Toyota Motor Sales & Marketing
Corporation
Chairman of Nagoya Grampus Eight Inc.
Nobuyori Kodaira(March 18, 1949)

Executive Vice
President,
Member of the Boardof Directors

1972 Joined Ministry of International Trade andIndustry
2004 Director-General, Agency for Natural
Resources and Energy
2006 Retired from Director-General, Agency for
Natural Resources and Energy
2008 Advisor of TMC
2009 Managing Officer of TMC
2010 Senior Managing Director of TMC
2011 Member of the Board of Directors and Senior
Managing Officer of TMC
2012 Executive Vice President of TMC(important concurrent duties)
Director of KDDI CORPORATION
Audit & Supervisory Board Member of Aichi SteelCorporation

92

23,000Name(Date of birth)

Mitsuhisa Kato
(March 2, 1953)

Position

Brief career summary and important concurrent duties

Executive Vice
President,
Member of the Boardof Directors

1975 Joined TMC
2004 Managing Officer of TMC
2006 Toyota Technocraft Co., Ltd. President
2006 Advisor of TMC
2007 Retired from Advisor of TMC
2010 Retired from Toyota Technocraft Co., Ltd.
President
2010 Senior Managing Director of TMC
2011 Senior Managing Officer of TMC
2012 Executive Vice President of TMC

Number of
Shares13,750(important concurrent duties)
Director of Toyota Boshoku Corporation
Director of Toyota Industries Corporation
Audit & Supervisory Board Member of Aisin Seiki
Co., Ltd.
Director of Hino Motors, Ltd.
Seiichi Sudo
(April 21, 1951)

Executive Vice
President,
Member of the Boardof Directors

1974 Joined TMC
2003 Managing Officer of TMC
2005 President of Toyota Motor Manufacturing
North America, Inc.
2006 Toyota Motor Manufacturing North America,
Inc. and Toyota Technical Center U.S.A., Inc.
merged and became Toyota Motor Engineering& Manufacturing North America, Inc.
2006 President of Toyota Motor Engineering &Manufacturing North America, Inc.
2008 President of Toyota Motor Kyushu, Inc.
2008 Advisor of TMC
2008 Retired from Toyota Motor Engineering &Manufacturing North America, Inc. President
2010 Retired from Advisor of TMC
2012 Retired from Toyota Motor Kyushu, Inc.
President
2012 Senior Managing Officer of TMC
2013 Executive Vice President of TMC(important concurrent duties)
Chairman of Toyota Motor (Changshu) Auto Parts
Co., Ltd.

93

12,300Name(Date of birth)

Takahiko Ijichi(July 15, 1952)

Position

Brief career summary and important concurrent duties

Executive Vice
President,
Member of the Boardof Directors

1976 Joined TMC
2004 Managing Officer of TMC
2008 Senior Managing Director of TMC
2011 Member of the Board of Directors and Senior
Managing Officer of TMC
2013 Advisor of TMC
2015 Executive Vice President, Member of theBoard of Directors

Number of
Shares27,000(important concurrent duties)
Director and President of TOWA REAL ESTATE
Co., Ltd.
Audit & Supervisory Board Member of Tokai Rika
Co., Ltd.
Didier Leroy(December 26,
1957)

Executive Vice
President,
Member of the Boardof Directors

1982 Joined Renault S.A.
1998 Joined Toyota Motor Manufacturing France
S.A.S.
1998 Toyota Motor Manufacturing France S.A.S.
Vice President
2005 Toyota Motor Manufacturing France S.A.S.
President
2007 Managing Officer of TMC
2007 Toyota Motor Europe NV/SA Executive Vice
President
2009 Toyota Motor Manufacturing France S.A.S.
Chairman2010 Toyota Motor Europe NV/SA President
2010 Retired from Toyota Motor Manufacturing
France S.A.S. Chairman
2011 Toyota Motor Europe NV/SA President andCEO2012 Senior Managing Officer of TMC
2015 Toyota Motor Europe NV/SA Chairman
2015 Executive Vice President, Member of theBoard of Directors of TMC(important concurrent duties)
Chairman of Toyota Motor Europe NV/SA
Chairman of Toyota Motor Engineering &Manufacturing North America, Inc.
Vice Chairman of Toyota Motor North America,
Inc.

94

—

Name
(Date of birth)

Shigeki Terashi(February 16, 1955)

Shigeru Hayakawa(September 15, 1953)

Number of
SharesPosition

Brief career summary and important concurrent duties

Executive Vice
President,
Member of the Boardof Directors

1980 Joined TMC
2008 Managing Officer of TMC
2008 Executive Vice President of Toyota Motor
Engineering & Manufacturing North America,Inc.
2011 President and COO of Toyota Motor
Engineering & Manufacturing North America,Inc.
2012 President and CEO of Toyota Motor
Engineering & Manufacturing North America,Inc.
2012 President and COO of Toyota Motor North
America, Inc.
2013 Retired from Toyota Motor Engineering &Manufacturing North America, Inc. President andCEO2013 Retired from Toyota Motor North America,
Inc. President and COO
2013 Senior Managing Officer of TMC
2013 Member of the Board of Directors and Senior
Managing Officer of TMC
2015 Executive Vice President, Member of theBoard of Directors of TMC

14,9001977 Joined Toyota Motor Sales Co., Ltd.
2007 Managing Officer of TMC
2007 Toyota Motor North America, Inc. President
2009 Retired from Toyota Motor North America,
Inc. President
2012 Senior Managing Officer of TMC
2015 Member of the Board of Directors and Senior
Managing Officer of TMC

14,20095

Name(Date of birth)

Position

Brief career summary and important concurrent duties

Ikuo Uno(January 4, 1935)

Member of the Boardof Directors

1959 Joined Nippon Life Insurance Company
1986 Director of Nippon Life Insurance Company
1988 Managing Director of Nippon Life Insurance
Company
1992 Senior Managing Director of Nippon Life
Insurance Company
1994 Vice President and Representative Director of
Nippon Life Insurance Company
1997 President and Representative Director of
Nippon Life Insurance Company
2005 Chairman and Representative Director of
Nippon Life Insurance Company
2011 Advisor and Director of Nippon Life
Insurance Company
2011 Advisor of Nippon Life Insurance Company
2013 Member of the Board of Directors of TMC

Number of
Shares—(important concurrent duties)
Advisor of Nippon Life Insurance Company
Outside Director of Fuji Kyuko Co., Ltd.
Outside Corporate Auditor of Odakyu Electric
Railway Co., Ltd.
Outside Corporate Auditor of Tohoku ElectricPower Co., Inc.
Outside Director of Panasonic Corporation
Outside Corporate Auditor of Sumitomo Mitsui
Financial Group, Inc.
Haruhiko Kato
(July 21, 1952)

Member of the Boardof Directors

1975 Joined Ministry of Finance (Japan)
2007 Director of Taxation Bureau, Ministry of
Finance (Japan)
2009 Director-General of National Tax
Administration Agency
2010 Retired from National Tax Administration
Agency Director-General2011 Senior Managing Director of Japan Securities
Depository Center, Inc.
2011 President and CEO of Japan Securities
Depository Center, Inc.
2013 Member of the Board of Directors of TMC(important concurrent duties)
President and CEO of Japan Securities Depository
Center, Inc.
Outside Director of Canon Inc.

96

—

Name
(Date of birth)

Position

Brief career summary and important concurrent duties

Mark. T. Hogan(May 15, 1951)

Member of the Boardof Directors

1973 Joined General Motors Corporation
2002 Vice President of General Motors Group
2004 Retired from General Motors Group Vice
President
2004 President of Magna International Inc.
2007 Retired from Magna International Inc.
President
2008 President and CEO of Vehicle Production
Group LLC
2010 Retired from Vehicle Production Group LLC
President and CEO
2010 President of Dewey Investments LLC
2013 Member of the Board of Directors of TMC

Number of
Shares—(important concurrent duties)
President of Dewey Investments LLC
Masaki Nakatsugawa Full-time Audit &(January 29, 1953)
Supervisory Board
Member1976 Joined Toyota Motor Sales Co., Ltd.
2000 Dispatched to Toyota Motor Thailand Co.,
Ltd.
2004 General Manager for Accounting Div. ofTMC
2006 Audit & Supervisory Board Member of TMC

5,800

Masahiro Kato
Full-time Audit &(September 17, 1952)
Supervisory Board
Member1975 Joined TMC
2009 Toyota Motor (China) Investment Co., Ltd.
President
2009 Managing Officer of TMC
2011 Retired from Toyota Motor (China)
Investment Co., Ltd. President
2011 Audit & Supervisory Board Member of TMC

4,400

Yoshiyuki Kagawa(December 18,
1952)

Full-time Audit &Supervisory Board
Member1983 Joined TMC
2010 General Manager of Prototype Production
Division of TMC
2015 Project General Manager of Secretary
Division of TMC
2015 Audit & Supervisory Board Member of TMC

600

Yoko Wake
Outside Audit &(November 18, 1947)
Supervisory Board
Member1970 Joined the Fuji Bank, Limited
1973 Retired from the same1977 Assistant Lecturer of Faculty of Business andCommerce of Keio University
1982 Associate Professor of the same
1993 Professor of the same2011 Outside Audit & Supervisory Board Memberof TMC2013 Professor Emeritus of Keio University—(important concurrent duties)
Professor Emeritus of Keio University

97

Name
(Date of birth)

Teisuke Kitayama(October 26, 1946)

Position

Brief career summary and important concurrent duties

Outside Audit &Supervisory Board
Member1969 Joined Mitsui Bank
1997 Director of The Sakura Bank, Limited
1999 Executive Officer of the same
2000 Managing Executive Officer of the same
2000 Managing Director and Managing Executive
Officer of the same2001 Managing Director and Managing Executive
Officer of Sumitomo Mitsui Banking
Corporation
2003 Senior Managing Director and Senior
Executive Officer of the same
2003 Senior Executive Officer of Sumitomo Mitsui
Financial Group, Inc.
2004 Vice President and Executive Officer of thesame2004 Retired from Director of Sumitomo Mitsui
Banking Corporation
2004 Vice President and Director of Sumitomo
Mitsui Financial Group, Inc.
2005 President and Director of the same2005 Chairman and Director of Sumitomo Mitsui
Banking Corporation2011 Retired from Director of Sumitomo Mitsui
Financial Group, Inc.
2014 Outside Audit & Supervisory Board Memberof TMC

Number of
Shares—(important concurrent duties)
Chairman of the Board of Sumitomo Mitsui
Banking Corporation
Outside Director of FUJIFILM Holdings
Corporation
Outside Auditor of Isetan Mitsukoshi Holdings Ltd.
Hiroshi Ozu(July 21, 1949)

Outside Audit &Supervisory Board
Member2012 Prosecutor-General
2014 Retired from Prosecutor-General
2014 Registered as Attorney2015 Outside Audit & Supervisory Board Memberof TMC—(important concurrent duties)
Attorney
Outside Corporate Auditor of Mitsui & Co., Ltd.
None of the persons listed above was selected as member of board of directors, audit & supervisory board
member or member of senior management pursuant to an arrangement or understanding with Toyota’s major
shareholders, customers, suppliers or others.

98Set forth below is a brief summary of Toyota’s substitute audit & supervisory board member.
Name(Date of birth)

Ryuji Sakai(August 7, 1957)

Position

Brief career summary and important concurrent duties—

1985 Registered as attorney and joined Nagashima &Ohno
1990 Wilson Sonsini Goodrich & Rosati
1995 Partner of Nagashima & Ohno
2000 Partner of Nagashima Ohno & Tsunematsu

Number of
Shares—(important concurrent duties)
Attorney
Outside Audit & Supervisory Board Member of
Kobayashi Pharmaceutical Co., Ltd.
Outside Audit & Supervisory Board Member ofTokyo Electron Limited
6.B COMPENSATION
The aggregate amount of remuneration, including bonuses but excluding stock options, accrued for all
members of the board of directors and audit & supervisory board members as a group by Toyota for services inall capacities during fiscal 2015 was approximately ¥2,032 million. Members of the Board of Directors of Toyota
Motor Corporation receive year-end bonuses, the aggregate amount of which is approved at Toyota Motor
Corporation’s ordinary general shareholders’ meeting and is based on Toyota Motor Corporation’s financial
performance for the fiscal year. The amounts of the bonuses paid to individual members of the board of directors
and audit & supervisory board members are then determined based upon discussions at a meeting of Toyota
Motor Corporation’s board of directors and the meeting of audit & supervisory board members.
In addition to the above form of compensation, Toyota has enacted stock option plans every year from 2007
until 2010. Under the 2007 plan, Toyota issued to its members of the board of directors and audit & supervisoryboard members stock acquisition rights to purchase 322,000 shares of common stock at an exercise price of¥7,278 and with an expiration date of July 31, 2015. Under the 2008 plan, Toyota issued to its members of theboard of directors and audit & supervisory board members stock acquisition rights to purchase 335,000 shares ofcommon stock at an exercise price of ¥4,726 and with an expiration date of July 31, 2016. Under the 2009 plan,
Toyota issued to its members of the board of directors and audit & supervisory board members stock acquisitionrights to purchase 440,000 shares of common stock at an exercise price of ¥4,193 and with an expiration date ofJuly 31, 2017. Under the 2010 plan, Toyota issued to its members of the board of directors stock acquisitionrights to purchase 400,000 shares of common stock at an exercise price of ¥3,183 and with an expiration date ofJuly 31, 2018. See “Share Ownership — Stock Options” for a more detailed discussion of Toyota’s stock option
plans.
Toyota’s Annual Securities Report filed with the Kanto Local Bureau of Finance on June 24, 2015,
contained the following information concerning compensation in fiscal 2015 on a consolidated basis for membersof the board of directors and audit & supervisory board members whose total compensation exceeded¥100 million during such period:- Takeshi Uchiyamada, Member of the Board of Directors: ¥201 million (¥102 million in base compensationand ¥99 million in bonus)- Akio Toyoda, Member of the Board of Directors: ¥352 million (¥102 million in base compensation and¥249 million in bonus)- Satoshi Ozawa, Member of the Board of Directors: ¥126 million (¥64 million in base compensation and¥61 million in bonus)
99

- Nobuyori Kodaira, Member of the Board of Directors: ¥126 million (¥64 million in base compensation and¥61 million in bonus)- Mitsuhisa Kato, Member of the Board of Directors: ¥126 million (¥64 million in base compensation and¥61 million in bonus)- Masamoto Maekawa, Member of the Board of Directors: ¥126 million (¥64 million in base compensationand ¥61 million in bonus)- Yasumori Ihara, Member of the Board of Directors: ¥122 million (¥64 million in base compensation and¥58 million in bonus)- Seiichi Sudo, Member of the Board of Directors: ¥122 million (¥64 million in base compensation and¥58 million in bonus)
The amounts above were recorded as expenses in fiscal 2015.
6.C BOARD PRACTICES
Toyota’s articles of incorporation provide for a board of directors of not more than 20 members and for not
more than seven audit & supervisory board members. Shareholders elect the members of the board of directors
and audit & supervisory board members at the general shareholders’ meeting. The normal term of office of amember of the board of directors is one year and of an audit & supervisory board member is four years. Membersof the board of directors and audit & supervisory board members may serve any number of consecutive terms.
The board of directors may appoint one Chairman of the Board of Directors and one President, as well as
one or more Vice Chairmen of the Board and Executive Vice Presidents. The board of directors elects, pursuant
to its resolutions, one or more Representative Directors. Each Representative Director represents Toyota
generally in the conduct of its affairs. The board of directors has the ultimate responsibility for the administrationof Toyota’s affairs. None of Toyota’s members of the board of directors is party to a service contract with Toyota
or any of its subsidiaries that provides for benefits upon termination of employment.
Under the Companies Act and Toyota’s articles of incorporation, Toyota may, by a resolution of its board of
directors, exempt members of the board of directors (including former members of the board of directors) fromtheir liabilities to Toyota arising in connection with their failure to execute their duties within the limits
stipulated by laws and regulations. In addition, Toyota may enter into a liability limitation agreement with eachmember of the board of directors (excluding executive members of the board of directors, among others) which
limits the maximum amount of their liabilities owed to Toyota arising in connection with their failure to execute
their duties to an amount equal to the minimum liability limit amount prescribed in the laws and regulations.
Under the Companies Act, Toyota must have at least three audit & supervisory board members. At least halfof the audit & supervisory board members are required to be an “outside” audit & supervisory board member,which is any person who satisfies all of the following requirements:(a) the person has never been a member of the board of directors, accounting counselor (in the case that an
accounting counselor is a legal entity, an employee of such entity who is in charge of its affairs), executive
officer, manager or employee of Toyota or its subsidiaries during the 10 year period before becoming an outside
audit & supervisory board member;(b) if the person was an audit & supervisory board member of Toyota or any of its subsidiaries at any time
during the 10 year period before becoming an outside audit & supervisory board member, such person has notbeen a member of the board of directors, accounting counselor (in the case that an accounting counselor is a legal100entity, an employee of such entity who is in charge of its affairs), executive officer, manager or employee ofToyota or any of its subsidiaries during the 10 year period before becoming an audit & supervisory board
member of Toyota or any of its subsidiaries; and(c) the person is not a spouse or relative within the second degree of kinship of any member of the board of
directors or manager or other key employee of Toyota.
The audit & supervisory board members may not at the same time be a member of the board of directors,
accounting counselor (in case that an accounting counselor is a judicial person, a member of such judicial person
who is in charge of its affairs), executive officers, general managers or employees of Toyota or any of its
subsidiaries. Together, these audit & supervisory board members form the audit & supervisory board. The
audit & supervisory board members have the duty to examine the financial statements and business reports which
are submitted by the board of directors to the general shareholders’ meeting. The audit & supervisory board
members also monitor the administration of Toyota’s affairs by the members of the board of directors. Audit &supervisory board members are not required to be, and Toyota’s audit & supervisory board members are not,certified public accountants. They are required to participate in meetings of the board of directors but are notentitled to vote.
Under the Companies Act and Toyota’s articles of incorporation, Toyota may, by a resolution of its board of
directors, exempt audit & supervisory board members (including former audit & supervisory board members)from their liabilities to Toyota arising in connection with their failure to execute their duties within the limits
stipulated by laws and regulations. In addition, Toyota may enter into a liability limitation agreement with each
audit & supervisory board member which limits the maximum amount of their liabilities owed to Toyota arisingin connection with their failure to execute their duties to an amount equal to the minimum liability limit amountprescribed in the laws and regulations.
Toyota does not have a remuneration committee.
6.D EMPLOYEESThe total number of Toyota employees, on a consolidated basis, was 344,109 as of March 31, 2015,
338,875 as of March 31, 2014 and 333,498 as of March 31, 2013. The following tables set forth a breakdown of
persons employed by business segment and by geographic location as of March 31, 2015.
Segment

Automotive . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial services . . . . . . . . . . . . . . . . . . . . .
All other . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unallocated . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Number of
Employees

Location

304,581 Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9,595 North America . . . . . . . . . . . . . . . . . . . . . .
25,130 Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4,803 Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . .
344,109 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Number of
Employees

197,20343,80919,11859,67924,300344,109* “Other” consists of Central and South America,
Oceania, Africa and the Middle East.
Most regular employees of Toyota Motor Corporation and its consolidated subsidiaries in Japan, other thanmanagement, are required to become members of the labor unions that comprise the Federation of All Toyota
Workers’ Unions. Approximately 86% of Toyota Motor Corporation’s regular employees in Japan are membersof this union.
In Japan, basic wages and other working conditions are negotiated annually. In addition, in accordance withJapanese national custom, each employee is also paid a semi-annual bonus. Bonuses are negotiated at the time of101

wage negotiations and are based on Toyota’s financial results, prospects and other factors. The average wage
increases per employee, excluding bonuses, in Japan have been approximately 2.4% per year for the past fivefiscal years.
In general, Toyota considers its labor relations with all of its workers to be good. However, Toyota iscurrently a party to, and otherwise from time to time experiences, labor disputes in some of the countries inwhich it operates. Toyota does not expect any disputes to which it is currently a party to materially affectToyota’s consolidated financial position.
Toyota’s average number of temporary employees on a consolidated basis was 85,848 during fiscal 2015.
6.E SHARE OWNERSHIP
For information on the number of shares of Toyota’s common stock held by each member of the board of
directors and audit & supervisory board member as of June 2015, see “— Directors and Senior Management”.
Each such member of the board of directors and audit & supervisory board member owns less than one percent of
the issued and outstanding shares of common stock of Toyota. The shares held by each member of the board of
directors and audit & supervisory board member do not include options that are exercisable for shares ofToyota’s common stock. For a description of these options, see “— Stock Options” below.
None of Toyota’s shares of common stock entitles the holder to any preferential voting rights.
Stock Options
Toyota enacted stock option plans every year from 2007 until 2010. Toyota will not enact any such plan
after 2011. The plans for which stock options or stock acquisition rights are currently exercisable or will become
exercisable in the future were approved by Toyota’s shareholders in June of 2007, 2008, 2009 and 2010. Underthe 2007 plan, Toyota issued stock acquisition rights to purchase 3,264,000 shares of common stock to its
members of the board of directors and 579 officers and employees, including directors, officers and employees of
its subsidiaries and one Toyota affiliated company. Under the 2008 plan, Toyota issued stock acquisition rights topurchase 3,494,000 shares of common stock to its members of the board of directors and 597 officers andemployees, including directors, officers and employees of its subsidiaries and one Toyota affiliated company.
Under the 2009 plan, Toyota issued stock acquisition rights to purchase 3,492,000 shares of common stock to its
members of the board of directors and 615 officers and employees, including directors, officers and employees of
its subsidiaries and one Toyota affiliated company. Under the 2010 plan, Toyota issued stock acquisition rights topurchase 3,600,000 shares of common stock to its members of the board of directors and officers and employees,
including directors, officers and employees of its subsidiaries and one Toyota affiliated company.
Pursuant to the provisions of the 2007, 2008, 2009 and 2010 plans, stock acquisition rights may be exercised
during a six-year period that starts two years from the date of grant. The exercise price of each stock acquisitionright is 1.025 times the closing price of Toyota’s common stock on the Tokyo Stock Exchange on the date of
grant. The 2007, 2008, 2009 and 2010 plans provide that each member of the board of directors will be granted
no more than 400 and no less than 300 stock acquisition rights, and each eligible officer or employee will be
granted no more than 200 and no less than 20 stock acquisition rights. For each of the 2007, 2008, 2009 and 2010plans, 100 shares will be issued or delivered upon the exercise of each stock acquisition right. The options are
granted as of early August of each year for each plan.
An option holder who retires while one’s options are still exercisable retains the right to exercise one’s
options until the expiration of the exercise period described above. However, an option holder’s right to purchasecommon stock under each plan lapses automatically upon one’s death or upon taking position such as in the
management with a competitor.

102

The following table summarizes information for options and the incentive plan outstanding and exercisable
at March 31, 2015:

Exercise price range(Yen)

Outstanding
Weightedaverage
Number of
exercisesharesprice(Yen)

3,183 – 5,000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,001 – 7,278 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,770,300
733,200

3,931
7,278

Weightedaverageremaininglife(Years)2.50
0.33

Exercisable
Weightedaverage
Number of
exercisesharesprice(Yen)

2,770,300
733,200

3,931
7,278

Toyota also has an employee stock ownership association in Japan for employees and full time and part timecompany advisors. Members of the employee stock ownership association set aside certain amounts from theirmonthly salary and bonuses to purchase Toyota’s common stock through the employee stock ownershipassociation. As of March 31, 2015, the employee stock ownership association held 13,882,628 shares of Toyota’scommon stock.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
7.A MAJOR SHAREHOLDERS
As of March 31, 2015, 3,417,997,492 shares of Toyota’s common stock were issued, out of which,271,183,861 shares were treasury stock and 3,146,813,631 shares were outstanding. Beneficial ownership ofToyota’s common stock in the table below was prepared from information known to Toyota or that could beascertained from public filings, including filings made by Toyota’s shareholders regarding their ownership ofToyota’s common stock under the Financial Instruments and Exchange Law of Japan.
Under the Financial Instruments and Exchange Law, any person who becomes, beneficially and solely or
jointly, a holder, including, but not limited to, a deemed holder who manages shares for another holder pursuant
to a discretionary investment agreement, of more than 5% of the total issued shares of a company listed on a
Japanese stock exchange (including ADSs representing such shares) must file a report concerning theshareholding with the director of the relevant local finance bureau. A similar report must be filed, with certain
exceptions, if the percentage of shares held by a holder, solely or jointly, of more than 5% of the total issued
shares of a company increases or decreases by 1% or more, or if any change to a material matter set forth in any
previously filed reports occurs.
Based on information known to Toyota or can be ascertained from public filings, the following table sets
forth the beneficial ownership of holders of more than 5% of Toyota’s common stock as of the most recent
practicable date.

Name of Beneficial Owner

Toyota Industries Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Number of
Shares(in thousands)

Percentage ofSharesIssued224,515

6.57

According to The Bank of New York Mellon, depositary for Toyota’s ADSs (the “Depositary”), as ofMarch 31, 2015, 82,545,759 shares of Toyota’s common stock were held in the form of ADRs and there were2,015 ADR holders of record and 253,658 beneficial owners in the United States. According to Toyota’s registerof shareholders, as of March 31, 2015, there were 496,859 holders of common stock of record worldwide. As of
March 31, 2015, there were 515 record holders of Toyota’s common stock with addresses in the United States,
whose shareholdings represented approximately 15.5% of the issued common stock on that date. Because someof these shares were held by brokers or other nominees, the number of record holders with addresses in the
United States might not fully show the number of beneficial owners in the United States.
103None of Toyota’s shares of common stock entitles the holder to any preferential voting rights.
To the extent known to Toyota, Toyota is not owned or controlled, directly or indirectly, by anothercorporation, any foreign government or any natural or legal person.
Toyota knows of no arrangements the operation of which may at a later time result in a change of control.
7.B RELATED PARTY TRANSACTIONSBusiness Relationships
Toyota purchases materials, supplies and services from numerous suppliers throughout the world in theordinary course of business, including Toyota’s affiliated companies accounted for by the equity method andthose firms with which certain members of Toyota’s board of directors are affiliated. Toyota purchased materials,
supplies and services from these affiliated entities in the amount of ¥5,065.6 billion in fiscal 2015. Toyota also
sells its products and services to Toyota’s affiliated companies accounted for by the equity method and firms
with which certain members of Toyota’s board of directors are affiliated. Toyota sold products and services tothese affiliated entities in the amount of ¥1,785.2 billion in fiscal 2015. See note 11 of Toyota’s consolidated
financial statements for additional information regarding Toyota’s investments in and transactions with affiliatedcompanies.
Loans
Toyota regularly has trade accounts and other receivables by, and accounts payable to, Toyota’s affiliatedcompanies accounted for by the equity method and firms with which certain members of Toyota’s board of
directors are affiliated. Toyota had outstanding trade accounts and other receivables by these affiliated entities in
the amount of ¥266.9 billion as of March 31, 2015. Toyota had outstanding trade accounts and other payables tothese affiliated entities in the amount of ¥635.8 billion as of March 31, 2015.
Toyota, from time to time, provides short- to medium-term loans to its affiliated companies, as well as loans
under a loan program established by certain subsidiaries to assist their executives and members of the board of
directors with the purchase of homes. As of March 31, 2015, an aggregate amount of ¥1.3 billion in loans wasoutstanding to its affiliated companies accounted for by the equity method. As of March 31, 2015, an aggregate
amount of ¥29.1 billion in loans was outstanding to those of its affiliated companies not accounted for by theequity method, which are 20% to 50% owned by Toyota. As of March 31, 2015, the largest loan outstanding to
any such affiliated company accounted for by the equity method was a loan of ¥1.0 billion at a fixed rate of
0.46%. Toyota believes that each of these loans was entered into in the ordinary course of business.
7.C INTERESTS OF EXPERTS AND COUNSEL
Not applicable.
ITEM 8. FINANCIAL INFORMATION
8.A CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION
1-3. Consolidated Financial Statements. Toyota’s audited consolidated financial statements are included under“Item 18 — Financial Statements”. Except for Toyota’s consolidated financial statements included under
Item 18, no other information in this annual report has been audited by Toyota’s auditors.
4.

Not applicable.

5.

Not applicable.
104

6.

Export Sales. See “Operating and Financial Review and Prospects — Operating Results — Overview —Geographic Breakdown”.

7.

Legal and Arbitration Proceedings. See “Information on the Company — Business Overview — Legal
Proceedings”.

8.

Dividend Policy. See “Key Information — Selected Financial Data — Dividend Information”.

8.B SIGNIFICANT CHANGES
Except as disclosed in this annual report, there have been no significant changes since the date of Toyota’s
latest annual financial statements.
ITEM 9. THE OFFER AND LISTING
9.A LISTING DETAILSThe following table sets forth for the periods shown the reported high and low sales prices of the common
stock on the Tokyo Stock Exchange and the ADSs on the New York Stock Exchange.
Tokyo
Stock Exchange
Price per Share
High
Low

New York
Stock Exchange
Price per ADS
High
Low

Fiscal Year Ended March 31,

2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

¥3,955
3,635
5,050
6,800
8,799

¥2,800
2,330
2,795
4,610
5,205

$ 93.9087.15
106.00134.94145.80$ 67.56
60.37
72.04
99.70
103.38

6,800
6,540
6,430
6,400
6,090
6,550
7,898
8,799

4,610
5,890
6,010
5,415
5,205
5,850
5,710
6,770

130.99134.94132.53121.74119.88122.35129.30145.8099.70
120.11
118.11106.31103.38113.92108.40121.21

7,898
7,834
8,229
8,799
8,535
8,700

7,107
6,770
7,495
8,029
8,175
8,150

129.30132.42138.70145.80142.84142.34121.06121.21128.96133.60137.20136.50Financial Quarter Ended:

June 30, 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
December 31, 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
June 30, 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
December 31, 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Month Ended:

December 31, 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
January 31, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
February 28, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
April 30, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
May 31, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9.B PLAN OF DISTRIBUTION
Not applicable.
1059.C MARKETSThe primary trading market for Toyota’s common stock is the Tokyo Stock Exchange. The common stock isalso listed on the Nagoya Stock Exchange and two other regional stock exchanges in Japan.
Since September 29, 1999, American Depositary Shares, each equal to two shares of Toyota’s common
stock and evidenced by American Depositary Receipts, have been traded and listed on the New York Stock
Exchange through a sponsored ADR facility operated by The Bank of New York Mellon, as Depositary. Prior tothat time, Toyota’s ADSs were listed on the Nasdaq SmallCap Market through five unsponsored ADR facilities.
Toyota’s common stock is also listed on the London Stock Exchange.
9.D SELLING SHAREHOLDERS
Not applicable.
9.E DILUTION
Not applicable.
9.F EXPENSES OF THE ISSUE
Not applicable.
ITEM 10. ADDITIONAL INFORMATION
10.A SHARE CAPITAL
Not applicable.
10.B MEMORANDUM AND ARTICLES OF ASSOCIATION
Except as otherwise stated, set forth below is information relating to Toyota’s common stock and Model AA
Class Shares, including brief summaries of the relevant provisions of Toyota’s articles of incorporation and sharehandling regulations, as currently in effect, and of the Companies Act, Act Concerning Book-Entry Transfer ofCorporate Bonds, Shares and Other Securities (the “Book-Entry Transfer Act”) and related legislation.
GeneralToyota’s authorized number of shares as of March 31, 2015 was 10,000,000,000 common shares, of which
3,417,997,492 shares were issued. The articles of incorporation was amended at the 111th Ordinary General
Shareholders’ Meeting held in June 2015 and Toyota’s authorized number of shares was changed to
10,000,000,000 shares, with the total number of authorized shares for each class of 10,000,000,000 for commonshares, 50,000,000 for First Series Model AA Class Shares, 50,000,000 for Second Series Model AA Class
Shares, 50,000,000 for Third Series Model AA Class Shares, 50,000,000 for Fourth Series Model AA Class
Shares and 50,000,000 for Fifth Series Model AA Class Shares, and the total number of shares authorized to beissued with respect to First Series Model AA Class Shares through the Fifth Series Model AA Class Shares not toexceed 150,000,000 shares. As of June 24, 2015, there were no Model AA Class Shares issued and outstanding.
Toyota does not issue share certificates for its shares. In accordance with the Companies Act, the BookEntry Transfer Act and Toyota’s articles of incorporation, Toyota’s common shares are recorded or registered on(i) Toyota’s register of shareholders and (ii) transfer account books of the Japan Securities Depository Center,
Inc. (“JASDEC”) which is a book-entry transfer institution and securities firms, banks or other account106management institutions. The transfer of common shares will generally become effective once the transfer isrecorded in the transferee’s account. In order to assert shareholders’ rights against Toyota, a shareholder must
generally have his or her name and address recorded or registered on Toyota’s register of shareholders. A holderof common shares can assert minority shareholders’ rights (shareholders’ rights for which Toyota has not set a
record date) against Toyota if JASDEC provides an individual shareholder notice to Toyota upon theshareholder’s request. The shareholder of deposited shares underlying the ADSs is the Depositary for the ADSs.
Accordingly, holders of ADSs will not be able directly to assert shareholders’ rights.
A holder of common shares must have a transfer account to transfer shares. Holders of common shares who
do not have a transfer account with JASDEC must have an account with an account management institution that
directly or indirectly has a transfer account with JASDEC. Once Toyota decides on the record date for its
shareholders’ meeting or makes a request to JASDEC based on justifiable grounds, JASDEC will promptly
provide to Toyota names, addresses and other information with respect to the holders of Toyota’s common shares
who are recorded on the transfer account books of JASDEC or account management institutions. Upon receivingsuch information, Toyota will record or register such information received from JASDEC on its register ofshareholders. Accordingly, holders of common shares recorded or registered on Toyota’s register of shareholders
will be treated as holders of common shares of Toyota and may exercise rights, such as voting rights, and will
receive dividends (if any) and notices to holders of common shares directly from Toyota. Holders of commonshares wishing to assert minority shareholders’ rights against Toyota must request an individual shareholder
notice to JASDEC or the account management institution at which the shareholder has opened a transfer account.
In response to such request, JASDEC will provide the individual shareholders notice to Toyota. A holder ofcommon shares may assert his or her minority shareholders’ rights against Toyota for a period of four weeks
after the date the individual shareholder notice is provided to Toyota. The shares held by a person who is deemedto hold additional shares according to the transfer account books are aggregated for these purposes.
Model AA Class Shares, once issued, will be recorded or registered on Toyota’s register of shareholders.
The transfer of Model AA Class Shares, once issued, will be effective upon an agreement between the transferor
and the transferee, but entry or record of a change of holder in the register of shareholders will require an
approval from the board of directors.
Corporate Purpose
Article 2 of Toyota’s articles of incorporation states that its purpose is to engage in the following
businesses:•

the manufacture, sale, leasing and repair of:•

motor vehicles, industrial vehicles, ships, aircraft, other transportation machinery and apparatus,
spacecraft and space machinery and apparatus, and parts thereof;•

industrial machinery and apparatus, other general machinery and apparatus, and parts thereof;•electrical machinery and apparatus, and parts thereof; and•measuring machinery and apparatus, medical machinery and apparatus, and parts thereof.

•

the manufacture and sale of ceramics and products of synthetic resins, and materials thereof;•

the manufacture, sale and repair of construction materials and equipment, furnishings and fixtures forresidential buildings;•

the planning, designing, supervision, execution and undertaking of construction works, civil engineering
works, land development, urban development and regional development;•

the sale, purchase, leasing, brokerage and management of real estate;•

the service of information processing, information communications and information supply and thedevelopment, sale and leasing of software;107•the design and development of product sales systems that utilize networks such as the Internet, sale,leasing and maintenance of computers included within such systems, and sale of products by utilizing
such systems;•

the inland transportation, marine transportation, air transportation, stevedoring, warehousing andtourism businesses;•

the printing, publishing, advertising and publicity, general leasing, security and workers dispatch
businesses;•

the credit card operations, purchase and sale of securities, investment consulting, investment trust
operation, and other financial services;•

the operation and management of such facilities as parking lots, showrooms, educational facilities,
medical care facilities, sports facilities, marinas, airfields, food and drink stands and restaurants, lodging
facilities, retail stores and others;•

the non-life insurance agency business and the life insurance agency business;•the production and processing by using biotechnology of agricultural products including trees, and thesale of such products;•

the sale of goods related to each of the preceding items and mineral oil;•the conducting of engineering, consulting, invention and research relating to each of the preceding items
and the utilization of such invention and research; and•any businesses incidental to or related to any of the preceding items.

Dividends
Dividends — General
Toyota normally pays dividends twice per year, including an interim dividend and a year-end dividend.
Although Toyota’s articles of incorporation provide that retained earnings can be distributed as dividends
pursuant to the resolution of its board of directors, Toyota’s board of directors recommends the payment of ayear-end dividend to holders of common shares and pledgees of common shares of record as of March 31, therecord date, in each year. Year-end dividends are usually paid to the holders of common shares immediately
following approval of the dividends at the general shareholders’ meeting, normally around the middle of June ofeach year. In addition, the articles of incorporation provide that in the event that Toyota pays a year-end dividend
to holders of common shares, it will pay AA Dividends in cash from surplus to any holders of Model AA Class
Shares or registered pledgees of Model AA Class Shares entered or recorded in the final register of shareholders
as of the record date for the year-end dividend, in preference to holders of common shares or registered pledgeesof common shares. The amount of annual AA Dividends per Model AA Class Share is calculated by multiplying
the amount per Model AA Class Share paid to Toyota as consideration by a rate determined by the board of
directors prior to the issuance of such Model AA Class Share, which rate is not to exceed 5%.
In addition to these year-end dividends, Toyota may pay an interim dividend in the form of cash
distributions from its distributable surplus to holders of common shares and pledgees of common shares of record
as of September 30, the record date, in each year by resolution of its board of directors. Toyota normally pays theinterim dividend in late November. The articles of incorporation provide that in the event that Toyota pays suchinterim dividends, Toyota will pay AA Interim Dividends in cash as interim dividend to any holders of ModelAA Class Shares or registered pledgees of Model AA Class Shares entered or recorded in the final register ofshareholders as of the record date for the interim dividend, in preference to holders of common shares orregistered pledgees of common shares. If AA Interim Dividends are paid during the fiscal year in which therecord date for the year-end dividend falls, the amount of AA Interim Dividends is deducted from AA Dividends
to be paid per the above paragraph.
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If the amount of the dividends from surplus paid in cash to holders of Model AA Class Shares or registeredpledgees of Model AA Class Shares is less than the prescribed amount of AA Dividends in any fiscal year, theamount of the shortfall will be carried forward to and accumulate in the following fiscal year and thereafter.
Dividends from surplus will be paid in cash to holders of Model AA Class Shares or registered pledgees ofModel AA Class Shares in preference to the payment of interim and year-end dividends until such payment
reaches the amount of the accumulated unpaid dividends.
In addition, under the Companies Act, dividends may be paid to holders of common shares and pledgees ofrecord of common shares as of any record date, other than those specified above, as set forth by Toyota’s articles
of incorporation or as determined by its board of directors from time to time. Toyota’s articles of incorporation
permit Toyota to pay dividends, in addition to interim dividends mentioned in the preceding paragraph, by aresolution of its board of directors. Toyota has incorporated such a provision into its articles of incorporation inorder to enable a flexible capital policy. Under the Companies Act, dividends may be distributed in cash or(except in the case of interim dividends mentioned in the second preceding paragraph) in kind, subject tolimitations on distributable surplus and to certain other conditions.
Dividends — Distributable amountUnder the Companies Act, Toyota is permitted to make distributions of surplus to the extent that theaggregate book value of the assets to be distributed to shareholders does not exceed the distributable amountprovided for by the Companies Act and the ordinance of the Ministry of Justice as at the effective date of such
distribution of surplus.
The amount of surplus at any given time shall be the amount of Toyota’s assets and the book value ofToyota’s treasury stock after subtracting and adding the amounts of items provided for by the Companies Act andthe ordinance of the Ministry of Justice, and the amount of surplus distributable for dividends is calculated byadding to and subtracting from this amount the amounts of items provided for by the Companies Act and theordinance of the Ministry of Justice.
Dividends — Prescription
Under its articles of incorporation, Toyota is not obligated to pay any dividends in cash which are left
unclaimed for a period of three years after the date on which they first became payable.
Capital Accounts
The amount of the cash or assets paid or contributed by subscribers for new shares (with certain exceptions)is required to be accounted for as stated capital, although Toyota may account for an amount not exceeding onehalf of such cash or assets as additional paid-in capital.
Under the Companies Act, Toyota may reduce its additional paid-in capital and legal reserve without
limitation on the amount to be reduced, generally, by a resolution of a general shareholders’ meeting and if so
decided by the same resolution, may account for the whole or any part of the amount of the reduction of
additional paid-in capital as stated capital. The whole or any part of surplus which may be distributed as
dividends may also be transferred to stated capital by a resolution of a general shareholders’ meeting.
Stock Splits
Toyota may at any time split the outstanding shares into a greater number of shares by a resolution of theboard of directors. Toyota must give public notice of the stock split, specifying a record date for the stock split,
not less than two weeks prior to the record date. Toyota shall conduct any stock split simultaneously and in thesame proportion with respect to the common shares and the Model AA Class Shares.
109Consolidation of Shares
Toyota may at any time consolidate shares in issue into a smaller number of shares by a special shareholders
resolution (as defined in “Voting Rights”). When a consolidation of shares is to be made, Toyota must give
public notice of certain matters two weeks prior to the effective date of the consolidation. Toyota must disclose
the reason for the consolidation of shares at a general shareholders’ meeting. Toyota shall conduct any
consolidation of shares simultaneously and in the same proportion with respect to the common shares and theModel AA Class Shares.
Japanese Unit Share System
General. Consistent with the requirements of the Companies Act, Toyota’s articles of incorporation providethat 100 common shares or Model AA Class Shares each constitute one “unit”. Although the number of sharesconstituting a unit is included in the articles of incorporation, any amendment to the articles of incorporation
reducing (but not increasing) the number of shares constituting a unit or eliminating the provisions for the unit ofshares may be made by a resolution of the board of directors rather than by a special shareholders resolution,
which is otherwise required for amending the articles of incorporation.
Voting Rights under the Unit Share System. Under the unit share system, shareholders have one voting
right for each unit of shares that they hold. Any number of common shares or Model AA Class Shares less than afull unit will carry no voting rights.
Purchase by Toyota of Shares Constituting Less Than a Unit. A holder of shares constituting less than afull unit may require Toyota to purchase those shares at their market value in the case of common shares and atfair price in the case of Model AA Class Shares in accordance with the provisions of Toyota’s share handlingregulations and the Companies Act.
Surrender of American Depositary Receipts. ADR holders will only be permitted to surrender ADRs andwithdraw underlying common shares constituting an integral number of a whole unit. If a holder surrenders an
ADR including ADRs representing common shares that do not constitute an integral number of whole units, theDepositary will deliver to that holder only those common shares which constitute a whole unit. The Depositary
will then issue to the holder a new ADR representing the remaining shares. Holders of an ADR that represents
less than a whole unit of underlying shares will be unable to withdraw the underlying shares. As a result, those
holders will be unable to require Toyota to purchase their common shares to the extent those common sharesconstitute less than one whole unit.
Voting Rights
Toyota holds its ordinary general shareholders’ meeting each year. In addition, Toyota may hold anextraordinary general shareholders’ meeting whenever necessary by giving at least two weeks’ advance notice.
Under the Companies Act, notice of any shareholders’ meeting must be given to each shareholder having voting
rights or, in the case of a non-resident shareholder, to his or her resident proxy or mailing address in Japan inaccordance with Toyota’s share handling regulations, at least two weeks prior to the date of the meeting.
Holders of common shares and holders of Model AA Class Shares shall have voting rights exercisable at a
general shareholders’ meeting. A holder of shares constituting one or more whole units is entitled to one vote perunit of shares subject to the limitations on voting rights set forth in this paragraph. In general, under theCompanies Act, a resolution can be adopted at a general shareholders’ meeting by a majority of the shares having
voting rights represented at the meeting. The Companies Act and Toyota’s articles of incorporation require aquorum for the election of members of the board of directors and audit & supervisory board members of not lessthan one-third of the total number of outstanding shares having voting rights. Toyota’s shareholders are notentitled to cumulative voting in the election of members of the board of directors. A corporate shareholder, themanagement of which is substantially under Toyota’s control as provided by an ordinance of the Ministry ofJustice, either through the holding of voting rights or for any other reason, does not have voting rights.
110

Shareholders may exercise their voting rights by attending the general shareholders’ meeting or in writingby mail. Shareholders who choose to exercise their voting rights by mail must fill out and return to Toyota thevoting right exercise form enclosed with the convocation notice of the general shareholders’ meeting by the datespecified in such convocation notice. In addition, from the general shareholders’ meeting for fiscal 2009,
shareholders may exercise their voting rights through the internet. Shareholders electing to exercise their voting
rights through the internet must log on to the “Website to Exercise Voting Rights” using the login ID andtemporary password provided in the voting right exercise form enclosed with the convocation notice and submit
their votes by a date specified in the convocation notice, following instructions appearing on the website.
Institutional investors may also use the Electronic Proxy Voting Platform operated by Investor Communications
Japan (“ICJ”) to exercise their voting rights through the use of the Internet, if such institutional investor applies
to use the platform in advance. Shareholders may also exercise their voting rights through proxies, provided thatthose proxies are also shareholders who have voting rights. Toyota may refuse a shareholder having two or more
proxies attend a general shareholders’ meeting.
The Companies Act provides that a quorum of at least one-third of outstanding shares with voting rights
must be present at a shareholders’ meeting to approve any material corporate actions such as:(1) any amendment of the articles of incorporation with certain exceptions in which a shareholders’
resolution is not required;(2) acquisition of its own shares from a specific party;(3) consolidation of shares;(4) any issue or transfer of its shares at a “specially favorable” price (or any issue of stock acquisitionrights or bonds with stock acquisition rights at “specially favorable” conditions by Toyota) to any
persons other than shareholders;(5) the removal of an audit & supervisory board member;(6) the exemption of liability of a director or audit & supervisory board member with certain
exceptions;(7) a reduction of stated capital which meets certain requirements with certain exceptions;(8) a distribution of in-kind dividends which meets certain requirements;(9) dissolution, merger, or consolidation with certain exceptions in which a shareholders’ resolution is
not required;(10) the transfer of the whole or a material part of the business;(11) the transfer in entirety or in part of shares or equity interest of a subsidiary under certain
conditions;(12) the taking over of the entire business of any other corporation with certain exceptions in which ashareholders’ resolution is not required;(13) share exchange or share transfer for the purpose of establishing 100% parent-subsidiary
relationships with certain exceptions in which a shareholders’ resolution is not required; or(14) company split with certain exceptions in which a shareholders’ resolution is not required.
At least two-thirds of the shares having voting rights represented at the meeting must approve these actions.
The voting rights of holders of ADSs are exercised by the Depositary based on instructions from those
holders.

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Rights to be Allotted Shares
Holders of common shares and Model AA Class Shares have no preemptive rights under Toyota’s articles
of incorporation. Under the Companies Act, the board of directors may, however, determine that shareholders
shall be given rights to be allotted shares or stock acquisition rights on request in connection with a particularissue or transfer of shares, or issue of stock acquisition rights, respectively. In this case, such rights must be given
on uniform terms to all shareholders as of a specified record date by at least two weeks’ prior public notice toshareholders of the record date.
Rights to be allotted shares are nontransferable. However, a shareholder may be allotted stock acquisitionrights without consideration thereto, and may transfer such rights.
Liquidation Rights
In the event of a liquidation of Toyota, the assets remaining after payment of all debts, liquidation expenses
and taxes will be distributed as follows. First, an amount per First Series Model AA Class Share through Fifth
Series Model AA Class Share, determined by resolution of the board of directors or calculated using a formuladetermined by a resolution of the board of directors prior to the issuance of such Model AA Class Shares basedon the amount per Model AA Class Shares paid to Toyota as consideration (the “Base Amount”), shall be paid in
cash to holders of Model AA Class Shares or registered pledgees of Model AA Class Shares. No other
distribution of residual assets shall be made to holders of Model AA Class Shares or registered pledgees ofModel AA Class Shares. The remaining residual assets shall be distributed among the holders of common sharesor registered pledgees of common shares in proportion to the respective number of shares they own.
Liability to Further Calls or Assessments
All of Toyota’s currently outstanding shares, including shares represented by the ADSs, are fully paid andnonassessable.
Transfer Agent
Mitsubishi UFJ Trust and Banking Corporation is the transfer agent for all shares. Mitsubishi UFJ Trust andBanking Corporation’s office is located at 4-5, Marunouchi 1-chome, Chiyoda-ku, Tokyo, 100-8212 Japan.
Mitsubishi UFJ Trust and Banking Corporation maintains Toyota’s register of shareholders and records transfersof record ownership (in the case of common shares, upon receiving notification from JASDEC).
Record Date
The close of business on March 31 is the record date for Toyota’s year-end dividends, if paid. A holder ofcommon shares or Model AA Class Shares constituting one or more whole units who is recorded or registered asa holder on Toyota’s register at the close of business as of March 31 is also entitled to exercise shareholders’voting rights at the ordinary general shareholders’ meeting with respect to the business year ending on March 31.
The close of business on September 30 of each year is the record date for interim dividends, if paid. In addition,
Toyota may set a record date for determining the shareholders entitled to other rights and for other purposes bygiving at least two weeks’ prior public notice.
The shares generally trade ex-dividend or ex-rights in the Japanese stock exchanges on the second business
day before a record date (or if the record date is not a business day, the third business day prior thereto), for the
purpose of dividends or rights offerings.
Acquisition by Toyota of Shares
Toyota may acquire its own common shares (i) through a stock exchange on which such shares are listed orby way of tender offer (pursuant to an ordinary resolution of a general shareholders’ meeting or a resolution of112

the board of directors), (ii) by purchase from a specific party (pursuant to a special resolution of a generalshareholders’ meeting) or (iii) from a subsidiary of Toyota (pursuant to a resolution of the board of directors). In
addition, Toyota may acquire its own Model AA Class Shares (i) by purchase from all holders of the relevant
series of Model AA Class Shares who make an offer to transfer the shares to Toyota upon notice from Toyota toacquire the shares (pursuant to an ordinary resolution of a general shareholders’ meeting), (ii) by purchase from a
specific party (pursuant to a special resolution of a general shareholders’ meeting) or (iii) from a subsidiary of
Toyota (pursuant to a resolution of the board of directors). When such acquisition of common shares is made by
Toyota from a specific party other than a subsidiary of Toyota, any other holder of common shares may make ademand to a representative director, more than five calendar days prior to the relevant shareholders’ meeting, that
Toyota also purchase the common shares held by such holder. However, the acquisition of its own commonshares at a price not exceeding the market price to be provided under an ordinance of the Ministry of Justice will
not trigger the right of any shareholder to include him/her as the seller of his/her shares in such proposed
purchase.
Any acquisition of shares must satisfy certain requirements that the total amount of the acquisition price
may not exceed the amount of the distributable dividends. See “— Dividends”.
Shares acquired by Toyota may be held by it for any period or may be cancelled by resolution of the boardof directors. Toyota may also transfer to any person the shares held by it, subject to a resolution of the board of
directors, and subject also to other requirements applicable to the issuance of new shares. Toyota may also utilize
its treasury stock for the purpose of transfer to any person upon exercise of stock acquisition rights or for the
purpose of acquiring another company by way of merger, share exchange or corporate split through exchange oftreasury stock for shares or assets of the acquired company.
The Companies Act generally prohibits any subsidiary of Toyota from acquiring shares of Toyota.
Model AA Class Shareholder’s Conversion Right into Common Shares
Holders of Model AA Class Shares may, at certain times specified in resolution of the board of directors as
the conversion period at the time of the issuance of First Series Model AA Class Shares to Fifth Series
Model AA Class Shares, demand that Toyota acquire some or all of such Model AA Class Shares held by suchholder of Model AA Class shares in exchange for common shares in a number determined by a formula specified
in such board resolution. Any fractions of less than one common share to be delivered in exchange for such
Model AA Class Shares shall be disregarded, in which case payment of money as provided in the Companies Act
shall not be made.
Model AA Class Shareholder’s Cash Put Option
Holders of Model AA Class Shares may, at certain times specified in resolution of the board of directors as
the cash put option period at the time of the issuance of First Series Model AA Class Shares to Fifth Series
Model AA Class Shares, demand that Toyota acquire some or all of such Model AA Class Shares in exchange
for cash in an amount equivalent to the Base Amount. If demand for acquisition exceeds the amount available
under the Companies Act for distribution as of the date of demand for such acquisition, Model AA Class Shares
to be acquired by Toyota shall be determined by a resolution of the board of directors, and the cash put option in
respect of Model AA Class Shares not so acquired shall be deemed not to have been exercised.
Toyota’s Cash Call Option
After the lapse of period specified in resolution of its board of directors at the time of the issuance of First
Series Model AA Class Shares to Fifth Series Model AA Class Shares, on an acquisition date separately
determined by a resolution of the board of directors, Toyota may acquire all of such Model AA Class Shares inexchange for cash in an amount equivalent to the Base Amount.
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Acquisition or Disposition of Shares or ADS
Under the Foreign Exchange and Foreign Trade Law and the cabinet orders and ministerial ordinances
thereunder (collectively, the “Foreign Exchange Regulations”), all aspects of regulations on foreign exchange
and foreign trade transactions are, with minor exceptions (which are not generally applicable to the purchase andsale of Toyota’s shares), only subject to post transaction reporting requirements. Acquisitions and dispositions ofshares of common stock or ADS by non-residents of Japan (including foreign corporations not resident in Japan)
are generally not subject to this reporting requirement. However, the Minister of Finance has the power toimpose a licensing requirement for transactions in limited circumstances.
Report of Substantial Shareholdings
The Financial Instruments and Exchange Law of Japan and regulations under the Law require any person
who has become a holder (together with its related persons) of more than 5% of the total issued shares of acompany listed on any Japanese stock exchange (including ADSs representing such shares) to file with the
Director of a competent Local Finance Bureau, within five business days, a report concerning thoseshareholdings. A similar report must also be filed to reflect any change of 1% or more in any shareholding or any
change in material matters set out in reports previously filed. Any such report shall be filed with the Director of acompetent Local Finance Bureau through the Electronic Disclosure for Investor’s Network (“EDINET”) system.
Copies of any report must also be furnished to the company. For this purpose, shares issuable to a shareholder
upon exercise of stock acquisition rights are taken into account in determining both the number of shares held bythat stock acquisition rights holder and the company’s total issued shares.
10.C MATERIAL CONTRACTS
All contracts concluded by Toyota during the two years preceding this filing were entered into in theordinary course of business.
10.D EXCHANGE CONTROLSThe Foreign Exchange Regulations govern the acquisition and holding of shares of capital stock of Toyota
by “exchange non-residents” and by “foreign investors”. The Foreign Exchange Regulations currently in effectdo not, however, affect transactions between exchange non-residents to purchase or sell shares outside Japan
using currencies other than Japanese yen.
Exchange non-residents are:•individuals who do not reside in Japan; and•corporations whose principal offices are located outside Japan.

Generally, branches and other offices of non-resident corporations that are located within Japan are regarded
as residents of Japan. Conversely, branches and other offices of Japanese corporations located outside Japan are
regarded as exchange non-residents.
Foreign investors are:•individuals who are exchange non-residents;•

corporations or other organizations that are organized under the laws of foreign countries or whose
principal offices are located outside of Japan; and•corporations (1) of which 50% or more of their voting rights are held directly or indirectly by
individuals who are exchange non-residents and/or corporations or other organizations (a) that areorganized under the laws of foreign countries or (b) whose principal offices are located outside of Japanor (2) a majority of whose officers, or officers having the power of representation, are individuals whoare exchange non-residents.
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In general, the acquisition of shares of a Japanese company (such as the shares of capital stock of Toyota)
by an exchange non-resident from a resident of Japan is not subject to any prior filing requirements. In certain
limited circumstances, however, the Minister of Finance may require prior approval of an acquisition of this type.
While prior approval, as described above, is not required, in the case where a resident of Japan transfers shares ofa Japanese company (such as the shares of capital stock of Toyota) for consideration exceeding ¥100 million toan exchange non-resident, the resident of Japan who transfers the shares is required to report the transfer to the
Minister of Finance within 20 days from the date of the transfer or the date of receipt of payment, whichevercomes later, unless the transfer was made through a bank or financial instruments business operator licensed orregistered under Japanese law.
If a foreign investor acquires shares of a Japanese company that is listed on a Japanese stock exchange (suchas the shares of capital stock of Toyota) and, as a result of the acquisition, the foreign investor, in combination
with any existing holdings, directly or indirectly holds 10% or more of the issued shares of the relevant company,
the foreign investor, with certain exceptions, must file a report of the acquisition with the Minister of Finance andany other competent Ministers having jurisdiction over that Japanese company by the 15th day of the monthfollowing the month in which the date of the acquisition falls. In limited circumstances, such as where the foreign
investor is in a country that is not listed on an exemption schedule in the Foreign Exchange Regulations, a priornotification of the acquisition must be filed with the Minister of Finance and any other competent Ministers, who
may then modify or prohibit the proposed acquisition.
Under the Foreign Exchange Regulations, dividends paid on, and the proceeds of sales in Japan of, shares
held by non-residents of Japan may in general be converted into any foreign currency and repatriated abroad.
Under the terms of the deposit agreement pursuant to which Toyota’s ADSs are issued, the Depositary is
required, to the extent that in its judgment it can convert yen on a reasonable basis into dollars and transfer the
resulting dollars to the United States, to convert all cash dividends that it receives in respect of deposited shares
into dollars and to distribute the amount received (after deduction of applicable withholding taxes) to the holders
of ADSs.
10.E TAXATION
The following discussion is a general summary of the principal U.S. federal income and Japanese national
tax consequences of the acquisition, ownership and disposition of shares of common stock or ADSs. Thissummary does not purport to address all material tax consequences that may be relevant to holders of shares ofcommon stock or ADSs, and does not take into account the specific circumstances of any particular investors,some of which (such as tax-exempt entities, banks, insurance companies, broker-dealers, traders in securities thatelect to use a mark-to-market method of accounting for their securities holdings, regulated investmentcompanies, real estate investment trusts, partnerships and other pass-through entities, investors liable for the U.S.
alternative minimum tax, investors that own or are treated as owning 10% or more of Toyota’s voting stock,investors that hold shares of common stock or ADSs as part of a straddle, hedge, conversion transaction or otherintegrated transaction and U.S. Holders (as defined below) whose functional currency is not the U.S. dollar) may
be subject to special tax rules. This summary is based on the tax laws and regulations of the United States andJapan, judicial decisions, published rulings and administrative pronouncements all as in effect on the date hereof,
as well as on the current income tax convention between the United States and Japan (the “Treaty”), as described
below, all of which are subject to change (possibly with retroactive effect), and to differing interpretations.
For purposes of this discussion, a “U.S. Holder” is any beneficial owner of shares of common stock or
ADSs that, for U.S. federal income tax purposes, is:1.

an individual who is a citizen or resident of the United States;2.

a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes)
organized in or under the laws of the United States, any state thereof, or the District of Columbia;
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3.

an estate the income of which is subject to U.S. federal income tax without regard to its source; or

4.

a trust that is subject to the primary supervision of a U.S. court and the control of one or more
U.S. persons, or that has a valid election in effect under applicable Treasury regulations to betreated as a U.S. person.

An “Eligible U.S. Holder” is a U.S. Holder that:1.

is a resident of the United States for purposes of the Treaty;2.

does not maintain a permanent establishment in Japan (a) with which the shares of common stockor ADSs are effectively connected and through which the U.S. holder carries on or has carried on
business, or (b) of which the shares of common stock or ADSs form part of the business property;
and3.

is eligible for benefits under the Treaty with respect to income and gain derived in connection
with the shares of common stock or ADSs.

This summary does not address any aspects of U.S. federal tax law other than income taxation and does notdiscuss any aspects of Japanese tax law other than income taxation, as limited to national taxes, inheritance andgift taxation. This summary also does not cover any state or local, or non-U.S., non-Japanese tax considerations.
Investors are urged to consult their tax advisors regarding the U.S. federal, state and local and Japanese and othertax consequences of acquiring, owning and disposing of shares of common stock or ADSs. In particular, where
relevant, investors are urged to confirm their status as Eligible U.S. Holders with their tax advisors and to discusswith their tax advisors any possible consequences of their failure to qualify as Eligible U.S. Holders. In addition,
this summary is based in part upon the representations of the Depositary and the assumption that each obligationin the deposit agreement, and in any related agreement, will be performed in accordance with its terms.
In general, for purposes of the Treaty and for U.S. federal income and Japanese income tax purposes,
owners of ADRs evidencing ADSs will be treated as the owners of the shares of common stock represented bythose ADSs, and exchanges of shares of common stock for ADSs, and exchanges of ADSs for shares of common
stock, will not be subject to U.S. federal income or Japanese income tax.
The discussion below is intended for general information only and does not constitute a complete analysisof all tax consequences relating to ownership of shares of common stock or ADSs. Prospective purchasers ofshares of common stock or ADSs should consult their own tax advisors concerning the tax consequences of
their particular situations.
Japanese Taxation
The following is a summary of the principal Japanese tax consequences (limited to national taxes) to nonresidents of Japan or non-Japanese corporations without permanent establishments in Japan (“non-resident
Holders”) who are holders of shares of common stock or of ADSs. The following information regarding taxationin Japan is based on the tax treaties and tax laws in force and their interpretation by Japan’s tax authorities as ofthe date of this annual report. Tax laws and treaties and their interpretations may change (including withretroactive effect). Toyota will not revise this summary on the basis of any such change occurring after the dateof this annual report.
Generally, non-resident Holders are subject to Japanese withholding tax on dividends paid by Japanese
corporations. Stock splits are, in general, not taxable events.
In the absence of an applicable tax treaty, convention or agreement reducing the maximum rate of Japanese
withholding tax or allowing exemption from Japanese withholding tax, the rate of Japanese withholding tax
applicable to dividends paid by Japanese corporations to non-resident Holders is generally 20.42 percent,116

provided, with respect to dividends paid on listed shares issued by a Japanese corporation (such as the shares ofcommon stock or ADSs of Toyota) to non-resident Holders, other than any individual shareholder who holds
3 percent or more of the total issued shares issued by the relevant Japanese corporation, the aforementioned
20.42 percent withholding tax rate is reduced to 15.315 percent for dividends due and payable on or before
December 31, 2037. Due to the imposition of a special additional withholding tax (2.1 percent of the original
withholding tax amount) to secure funds for reconstruction from the Great East Japan Earthquake, the original
withholding tax rate of 15 percent and 20 percent, as applicable, is effectively increased to 15.315 percent and20.42 percent, respectively, until December 31, 2037.
At the date of this annual report, Japan has income tax treaties, conventions or agreements whereby theabove-mentioned withholding tax rate is reduced, in most cases to 15 percent or 10 percent for portfolio investors(15 percent under the income tax treaties with, among other countries, Belgium, Canada, Denmark, Finland,
Germany, Ireland, Italy, Luxembourg, New Zealand, Norway, Singapore, and Spain, and 10 percent under theincome tax treaties with, among other countries, Australia, France, Hong Kong, the Netherlands, Portugal,
Sweden, Switzerland, the U.K. and the United States).
Under the Treaty, the maximum rate of Japanese withholding tax which may be imposed on dividends paidby a Japanese corporation to an Eligible U.S. Holder that is a portfolio investor is generally reduced to 10 percentof the gross amount actually distributed, and dividends paid by a Japanese corporation to an Eligible U.S. Holderthat is a pension fund are exempt from Japanese income tax by way of withholding or otherwise unless such
dividends are derived from the carrying on of a business, directly or indirectly, by such pension fund.
If the maximum tax rate provided for in the income tax treaty applicable to dividends paid by Toyota to any
particular non-resident Holder is lower than the withholding tax rate otherwise applicable under Japanese tax law
or if any particular non-resident Holder is exempt from Japanese income tax with respect to such dividends under
the income tax treaty applicable to such particular non-resident Holder, such non-resident Holder who is entitledto a reduced rate of or exemption from Japanese withholding tax on payment of dividends on shares of common
stock by Toyota is required to submit an Application Form for Income Tax Convention Regarding Relief fromJapanese Income Tax and Special Income Tax for Reconstruction on Dividends (together with any other required
forms and documents) in advance through the withholding agent to the relevant tax authority before the payment
of dividends. A standing proxy for non-resident Holders of a Japanese corporation may provide this application
service. In addition, a simplified special filing procedure is available for non-resident Holders to claim treaty
benefits of exemption from or reduction of Japanese withholding tax by submitting a Special Application Formfor Income Tax Convention Regarding Relief from Japanese Income Tax and Special Income Tax for
Reconstruction on Dividends of Listed Stock (together with any other required forms and documents). With
respect to ADSs, this reduced rate or exemption is applicable if the Depositary or its agent submits, together withother documents, two Application Forms (one before payment of dividends, the other within eight months after
the recording date concerning such payment of dividends) to the Japanese tax authority. To claim this reduced
rate or exemption, any relevant non-resident Holder of ADSs will be required to file a proof of taxpayer status,
residence and beneficial ownership (as applicable) and to provide other information or documents as may berequired by the Depositary. A non-resident Holder who is entitled, under an applicable income tax treaty, to a
reduced treaty rate lower than the withholding tax rate otherwise applicable under Japanese tax law or an
exemption from the withholding tax, but fails to submit the required application in advance, will be entitled toclaim the refund of withholding taxes withheld in excess of the rate under an applicable tax treaty (if such nonresident Holder is entitled to a reduced treaty rate under the applicable income tax treaty) or the whole of thewithholding tax withheld (if such non-resident Holder is entitled to an exemption under the applicable income tax
treaty) by complying with a certain subsequent filing procedure. Toyota does not assume any responsibility toensure withholding at the reduced rate, or exemption therefrom, for non-resident Holders who would be so
eligible under an applicable tax treaty but where the required procedures as stated above are not followed.
Gains derived from the sale of shares of common stock or ADSs outside Japan by a non-resident Holder
holding such shares of common stock or ADSs as portfolio investors are, in general, not subject to Japanese117

income tax or corporation tax under Japanese law. Eligible U.S. Holders are not subject to Japanese income or
corporation tax with respect to such gains under the Treaty so long as filings required under Japanese law are
made.
Japanese inheritance and gift taxes at progressive rates may be payable by an individual who has acquired
from another individual shares of common stock or ADSs as a legatee, heir or donee even though neither theindividual, nor the deceased, nor donor is a Japanese resident.
Holders of shares of common stock or ADSs should consult their tax advisors regarding the effect of thesetaxes and, in the case of U.S. Holders, the possible application of the Estate and Gift Tax Treaty between the
United States and Japan.
U.S. Federal Income Taxation
U.S. Holders
The following discussion is a summary of the principal U.S. federal income tax consequences to U.S.
Holders that hold shares of common stock or ADSs as capital assets (generally, for investment purposes).
Taxation of Dividends
Subject to the passive foreign investment company (“PFIC”) rules discussed below, the gross amount of any
distribution made by Toyota in respect of shares of common stock or ADSs (without reduction for Japanese
withholding taxes) will constitute a taxable dividend to the extent paid out of current or accumulated earnings
and profits, as determined under U.S. federal income tax principles. The U.S. dollar amount of such a dividend
generally will be included in the gross income of a U.S. Holder, as ordinary income, when actually or
constructively received by the U.S. Holder, in the case of shares of common stock, or by the Depositary, in thecase of ADSs. Dividends paid by Toyota will not be eligible for the dividends-received deduction generally
allowed to U.S. corporations in respect of dividends received from other U.S. corporations.
Dividends received on shares and ADSs of certain foreign corporations by non-corporate U.S. investors may
be subject to U.S. federal income tax at lower rates than other types of ordinary income if certain conditions are
met. Dividends received by non-corporate U.S. Holders with respect to shares of common stock or ADSs ofToyota are expected to be eligible for these reduced rates of tax. U.S. Holders should consult their own tax
advisors regarding the eligibility of such dividends for a reduced rate of tax.
The U.S. dollar amount of a dividend paid in Japanese yen will be determined based on the Japanese yen/
U.S. dollar exchange rate in effect on the date that the dividend is included in the gross income of the U.S.
Holder, regardless of whether the payment is converted into U.S. dollars on that date. Generally, any gain or loss
resulting from currency exchange fluctuations during the period from the date the dividend payment is includedin the gross income of a U.S. Holder through the date that payment is converted into U.S. dollars (or otherwise
disposed of) will be treated as U.S.-source ordinary income or loss. U.S. Holders should consult their own tax
advisors regarding the calculation and U.S. federal income tax treatment of foreign currency gain or loss.
To the extent, if any, that the amount of any distribution received by a U.S. Holder in respect of shares ofcommon stock or ADSs exceeds Toyota’s current and accumulated earnings and profits, as determined under
U.S. federal income tax principles, the distribution first will be treated as a tax-free return of capital to the extent
of the U.S. Holder’s adjusted tax basis in those shares or ADSs, and thereafter will be treated as U.S.-source
capital gain.
Distributions of additional shares of common stock that are made to U.S. Holders with respect to theirshares of common stock or ADSs, and that are part of a pro rata distribution to all of Toyota’s shareholders,
generally will not be subject to U.S. federal income tax.
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For U.S. foreign tax credit purposes, dividends included in gross income by a U.S. Holder in respect ofshares of common stock or ADSs will constitute income from sources outside the United States, and will
generally be “passive category income” or, in the case of certain U.S. Holders, “general category income”.
Subject to generally applicable limitations under U.S. federal income tax law and the Treaty, any Japanese
withholding tax imposed in respect of a Toyota dividend may be claimed as a credit against the U.S. federal
income tax liability of a U.S. Holder, or alternatively as a deduction in the computation of such U.S. Holder’staxable income if the U.S. Holder does not elect to claim a credit for any foreign taxes paid or accrued for the
taxable year. Special rules generally will apply to the calculation of foreign tax credits in respect of dividend
income that qualifies for preferential U.S. federal income tax rates. Additionally, special rules apply toindividuals whose foreign source income during the taxable year consists entirely of “qualified passive income”
and whose creditable foreign taxes paid or accrued during the taxable year do not exceed $300 ($600 in the caseof a joint return). Further, under some circumstances, a U.S. Holder that:(i) has held shares of common stock or ADSs for less than a specified minimum period; or(ii) is obligated to make payments related to Toyota dividends,
will not be allowed a foreign tax credit for Japanese taxes imposed on Toyota dividends.
U.S. Holders are urged to consult their tax advisors regarding the availability of the foreign tax credit under
their particular circumstances.
Taxation of Capital Gains and Losses
In general, upon a sale or other taxable disposition of shares of common stock or ADSs, a U.S. Holder willrecognize gain or loss for U.S. federal income tax purposes in an amount equal to the difference between theamount realized on the sale or other taxable disposition and the U.S. Holder’s adjusted tax basis in those sharesof common stock or ADSs. A U.S. Holder generally will have an adjusted tax basis in a share of common stockor an ADS equal to its U.S. dollar cost. Subject to the PFIC rules discussed below, gain or loss recognized on thesale or other taxable disposition of shares of common stock or ADSs generally will be capital gain or loss and, if
the U.S. Holder’s holding period for those shares or ADSs exceeds one year, will be long-term capital gain or
loss. Non-corporate U.S. Holders, including individuals, currently are eligible for preferential rates of U.S.
federal income tax in respect of long-term capital gains. Under U.S. federal income tax law, the deduction ofcapital losses is subject to limitations. Any gain or loss recognized by a U.S. Holder in respect of the sale or otherdisposition of shares of common stock or ADSs generally will be treated as U.S.-source income or loss for U.S.
foreign tax credit purposes.
Deposits and withdrawals of common stock in exchange for ADSs will not result in the realization of gainor loss for U.S. federal income tax purposes.
Passive Foreign Investment Companies
A non-U.S. corporation generally will be classified as a PFIC for U.S. federal income tax purposes in any
taxable year in which, after applying look-through rules, either (1) at least 75% of its gross income is passive
income or (2) on average at least 50% of the gross value of its assets is attributable to assets that produce passive
income or are held for the production of passive income. Passive income for this purpose generally includes
dividends, interest, royalties, rents and gains from commodities and securities transactions. The PFIC
determination is made annually and generally is based on the value of a non-U.S. corporation’s assets (including
goodwill) and composition of its income.
Toyota does not believe that it was a PFIC for U.S. federal income tax purposes for its taxable year ended
March 31, 2015, and currently intends to continue its operations in such a manner that it will not become a PFICin the future. Because the PFIC determination is made annually and the application of the PFIC rules to a119

corporation such as Toyota (which among other things is engaged in leasing and financing through several
subsidiaries) is not entirely clear, no assurances can be made regarding determination of its PFIC status in thecurrent or any future taxable year. If Toyota is determined to be a PFIC, U.S. Holders could be subject toadditional U.S. federal income taxes on gain recognized with respect to the shares of common stock or ADSs andon certain distributions. In addition, an interest charge may apply to the portion of the U.S. federal income tax
liability on such gains or distributions treated under the PFIC rules as having been deferred by the U.S. Holder.
Moreover, dividends that a non-corporate U.S. Holder receives from Toyota will not be eligible for the reduced
U.S. federal income tax rates on dividends described above if Toyota is a PFIC either in the taxable year of thedividend or the preceding taxable year. If a U.S. Holder owns shares of common stock or ADSs in any taxable
year in which Toyota is a PFIC, such U.S. Holder generally would be required to file Internal Revenue Service(“IRS”) Form 8621 (or other form specified by the U.S. Department of the Treasury) on an annual basis, subject
to certain exceptions based on the value of PFIC stock held. Toyota will inform U.S. Holders if it believes that it
will be classified as a PFIC in any taxable year.
Prospective investors should consult their own tax advisors regarding the potential application of the PFIC
rules to shares of common stock or ADSs.
Non-U.S. Holders
The following discussion is a summary of the principal U.S. federal income tax consequences to beneficial
owners of shares of common stock or ADSs that are neither U.S. Holders, nor partnerships, nor entities taxable aspartnerships for U.S. federal income tax purposes (“Non-U.S. Holders”).
A Non-U.S. Holder generally will not be subject to any U.S. federal income or withholding tax on
distributions received in respect of shares of common stock or ADSs unless the distributions are effectively
connected with the conduct by the Non-U.S. Holder of a trade or business within the United States (and, if anapplicable tax treaty requires, are attributable to a U.S. permanent establishment or fixed base of such Non-U.S.
Holder).
A Non-U.S. Holder generally will not be subject to U.S. federal income tax in respect of gain recognized ona sale or other disposition of shares of common stock or ADSs, unless:(i)the gain is effectively connected with a trade or business conducted by the Non-U.S. Holder within the
United States (and, if an applicable tax treaty requires, is attributable to a U.S. permanent establishment
or fixed base of such Non-U.S. Holder); or(ii) the Non-U.S. Holder is an individual who was present in the United States for 183 or more days in the
taxable year of the disposition and other conditions are met.
Income that is effectively connected with a U.S. trade or business of a Non-U.S. Holder, and, if an income
tax treaty applies and so requires, is attributable to a U.S. permanent establishment or fixed base of the Non-U.S.
Holder, generally will be taxed in the same manner as the income of a U.S. Holder. In addition, under certain
circumstances, any effectively connected earnings and profits realized by a corporate Non-U.S. Holder may besubject to an additional “branch profits tax” at the rate of 30% or at a lower rate that may be prescribed by anapplicable income tax treaty.
Backup Withholding and Information Reporting
In general, information reporting requirements will apply to dividends paid to a U.S. Holder in respect ofshares of common stock or ADSs, and to the proceeds received upon the sale, exchange or redemption of theshares of common stock or ADSs within the United States by U.S. Holders. Furthermore, backup withholding
may apply to those amounts (currently at a 28% rate) if a U.S. Holder fails to provide an accurate taxpayer
identification number to certify that such U.S. Holder is not subject to backup withholding or to otherwise
comply with the applicable requirements of the backup withholding requirements.
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Dividends paid to a Non-U.S. Holder in respect of shares of common stock or ADSs, and proceeds received
upon the sale, exchange or redemption of shares of common stock or ADSs by a Non-U.S. Holder, generally are
exempt from information reporting and backup withholding under current U.S. federal income tax law. However,a Non-U.S. Holder may be required to provide certification of non-U.S. status in order to obtain that exemption.
Persons required to establish their exempt status generally must provide such certification under penalty of
perjury on IRS Form W-9, entitled Request for Taxpayer Identification Number and Certification, in the case of
U.S. persons, and on IRS Form W-8BEN, entitled Certificate of Foreign Status of Beneficial Owner for UnitedStates Tax Withholding and Reporting (Individuals), or IRS Form W-8BEN-E, entitled Certificate of Status ofBeneficial Owner for United States Tax Withholding and Reporting (Entities) (or other appropriate IRS
Form W-8), in the case of non-U.S. persons. Backup withholding is not an additional tax. The amount of backup
withholding imposed on a payment generally may be claimed as a credit against the holder’s U.S. federal income
tax liability, provided that the required information is properly furnished to the IRS in a timely manner.
In addition, certain U.S. Holders who are individuals that hold certain foreign financial assets (which may
include shares of common stock or ADSs) are required to report information relating to such assets, subject tocertain exceptions. U.S. Holders should consult their tax advisors regarding the effect, if any, of this legislationon their ownership and disposition of shares of common stock or ADSs.
THE SUMMARY OF U.S. FEDERAL INCOME AND JAPANESE NATIONAL TAX CONSEQUENCESSET OUT ABOVE IS INTENDED FOR GENERAL INFORMATION PURPOSES ONLY. PROSPECTIVE
PURCHASERS OF COMMON STOCK OR ADSs ARE URGED TO CONSULT WITH THEIR OWN TAXADVISORS WITH RESPECT TO THE PARTICULAR TAX CONSEQUENCES TO THEM OF OWNING ORDISPOSING OF COMMON STOCK OR ADSs, BASED ON THEIR PARTICULAR CIRCUMSTANCES.
10.F DIVIDENDS AND PAYING AGENTS
Not applicable.
10.G STATEMENT BY EXPERTS
Not applicable.
10.H DOCUMENTS ON DISPLAY
Toyota files annual reports on Form 20-F and reports on Form 6-K with the SEC. You may read and copy
this information at the SEC’s Public Reference Room at 100 F Street, N.E., Room 1580, Washington,
D.C. 20549 or by accessing the SEC’s home page (http://www.sec.gov). You can also request copies of the
documents, upon payment of a duplicating fee, by writing to the Public Reference Section of the SEC. Please callthe SEC at 1-800-SEC-0330 for further information on the operation of the Public Reference Room. In addition,
Toyota’s reports, proxy statements and other information may be inspected at the offices of the New York Stock
Exchange, 20 Broad Street, New York, New York 10005. Copies of the documents referred to herein may also beinspected at Toyota’s offices by contacting Toyota at 1 Toyota-cho, Toyota City, Aichi Prefecture 471-8571,
Japan, attention: Financial Reporting Department, Accounting Division, telephone number: 81-565-28-2121.
10.I SUBSIDIARY INFORMATION
Not applicable.

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ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Quantitative and Qualitative Disclosures about Market Risk
Toyota is exposed to market risk from changes in foreign currency exchange rates, interest rates, certain
commodity and equity security prices. In order to manage the risk arising from changes in foreign currency
exchange rates and interest rates, Toyota enters into a variety of derivative financial instruments.
A description of Toyota’s accounting policies for derivative instruments is included in note 2 to theconsolidated financial statements and further disclosure is provided in notes 20 and 26 to the consolidated
financial statements.
Toyota monitors and manages these financial exposures as an integral part of its overall risk management
program, which recognizes the unpredictability of financial markets, and seeks to reduce the potentially adverse
effects on Toyota’s operating results.
The financial instruments included in the market risk analysis consist of all of Toyota’s cash and cash
equivalents, marketable securities, finance receivables, securities investments, long-term and short-term debt andall derivative financial instruments. Toyota’s portfolio of derivative financial instruments consists of forward
foreign currency exchange contracts, foreign currency options, interest rate swaps, interest rate currency swap
agreements and interest rate options. Anticipated transactions denominated in foreign currencies that are coveredby Toyota’s derivative hedging are not included in the market risk analysis. Although operating leases are notrequired to be included, Toyota has included these instruments in determining interest rate risk.
Foreign Currency Exchange Rate Risk
Toyota has foreign currency exposures related to buying, selling and financing in currencies other than thelocal currencies in which it operates. Toyota is exposed to foreign currency risk related to future earnings orassets and liabilities that are exposed due to operating cash flows and various financial instruments that are
denominated in foreign currencies. Toyota’s most significant foreign currency exposures relate to the U.S. dollar
and the euro.
Toyota uses a value-at-risk analysis (“VAR”) to evaluate its exposure to changes in foreign currency
exchange rates. The VAR of the combined foreign exchange position represents a potential loss in pre-tax
earnings that was estimated to be ¥172.8 billion and ¥163.4 billion as of March 31, 2014 and 2015, respectively.
Based on Toyota’s overall currency exposure (including derivative positions), the risk during fiscal 2015 to pretax cash flow from currency movements was on average ¥161.7 billion, with a high of ¥174.1 billion and a lowof ¥153.5 billion.
The VAR was estimated by using a Monte Carlo Simulation Method and assumed 95% confidence level on
the realization date and a 10-day holding period.
Interest Rate Risk
Toyota is subject to market risk from exposures to changes in interest rates based on its financing, investing
and cash management activities. Toyota enters into various financial instrument transactions to maintain thedesired level of exposure to the risk of interest rate fluctuations and to minimize interest expense. The potential
decrease in fair value resulting from a hypothetical 100 basis point upward shift in interest rates would beapproximately ¥217.8 billion as of March 31, 2014 and ¥244.9 billion as of March 31, 2015.
There are certain shortcomings inherent to the sensitivity analyses presented. The model assumes thatinterest rate changes are instantaneous parallel shifts in the yield curve. However, in reality, changes are rarely
instantaneous. Although certain assets and liabilities may have similar maturities or periods to repricing, they122

may not react correspondingly to changes in market interest rates. Also, the interest rates on certain types ofassets and liabilities may fluctuate with changes in market interest rates, while interest rates on other types ofassets may lag behind changes in market rates. Finance receivables are less susceptible to prepayments wheninterest rates change and, as a result, Toyota’s model does not address prepayment risk for automotive related
finance receivables. However, in the event of a change in interest rates, actual loan prepayments may deviatesignificantly from the assumptions used in the model.
Commodity Price Risk
Commodity price risk is the possibility of higher or lower costs due to changes in the prices of commodities,
such as non-ferrous alloys (e.g., aluminum), precious metals (e.g., palladium, platinum and rhodium) and ferrous
alloys, which Toyota uses in the production of motor vehicles. Toyota does not use derivative instruments tohedge the price risk associated with the purchase of those commodities and controls its commodity price risk byholding minimum stock levels.
Equity Price Risk
Toyota holds investments in various available-for-sale equity securities that are subject to price risk. The
fair value of available-for-sale equity securities was ¥1,997.1 billion as of March 31, 2014 and ¥2,704.8 billion asof March 31, 2015. The potential change in the fair value of these investments, assuming a 10% change in prices,would be approximately ¥199.7 billion as of March 31, 2014 and ¥270.4 billion as of March 31, 2015.
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
12.A DEBT SECURITIES
Not applicable.
12.B WARRANTS AND RIGHTS
Not applicable.
12.C OTHER SECURITIES
Not applicable.

12312.D AMERICAN DEPOSITARY SHARESFees and Charges for Holders of American Depositary Receipts
The Bank of New York Mellon, as Depositary for the ADSs, collects its fees for delivery and surrender of
ADSs directly from investors depositing shares or surrendering ADSs for the purpose of withdrawal or fromintermediaries acting for them. The Depositary collects fees for making distributions to investors by deducting
those fees from the amounts distributed or by selling a portion of distributable property to pay the fees. The
Depositary may generally refuse to provide fee-attracting services until its fees for those services are paid.
Persons depositing or withdrawing shares must pay:For:

$5.00 (or less) per 100 ADSs (or portion of 100 ADSs)•

Issuance of ADSs, including issuances resulting
from a distribution, sale or exercise of shares orrights or other property•

Cancellation of ADSs for the purpose ofwithdrawal including if the deposit agreement
terminates$0.02 (or less) per ADS•

Any cash distribution to ADS registered holders

A fee equivalent to the fee that would be payable if
securities distributed to the ADR holder had been sharesand the shares had been deposited for issuance of ADSs•

Distribution of securities distributed to holders
of deposited securities which are distributed by
the Depositary to ADS registered holders

Registration fees•

Registration of transfer of shares on Toyota’sshare register to the name of the Depositary or
its nominee or the custodian or its nominee
when shares are deposited or withdrawn

Expenses of the Depositary•

Cable, telex and facsimile transmissions (whenexpressly provided in the deposit agreement)•

Converting foreign currency to U.S. dollars•

As necessary

Taxes and other governmental charges the Depositary or
the custodian have to pay on any ADS or share
underlying an ADS
Fees Incurred in Fiscal 2015

For fiscal 2015, Toyota received $200,000 from the Depositary for standard out-of-pocket maintenancecosts for the ADRs (consisting of the expenses of postage and envelopes for mailing annual reports, printing anddistributing dividend checks, stationery, postage, facsimile, and telephone calls) and expenses relating toToyota’s annual general shareholders’ meeting that are incurred with respect to Toyota’s ADR holders. The
Depositary also paid Toyota’s continuing annual stock exchange listing fees.
Fees to be Paid in the Future
The Depositary has agreed to reimburse Toyota for expenses Toyota incurs that are related to themaintenance of the ADS program. The Depositary has agreed to pay the standard out-of-pocket maintenancecosts for the ADRs, which includes the expenses of postage and envelopes for mailing annual reports, printing
and distributing dividend checks, stationery, postage, facsimile and telephone calls. It has also agreed toreimburse Toyota annually for investor relations expenses and any other program related expenses. The limit on
the amount of expenses for which the Depositary will reimburse Toyota is the sum of $300,000 and 50% of thetotal amount of cash distributions made to registered ADS holders.
124PART IIITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIESNone.
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
PROCEEDS
On June 16, 2015, Toyota amended its articles of incorporation in connection with establishment of ModelAA Class Shares pursuant to resolutions adopted by its shareholders at the general shareholders’ meeting on thesame date. The amended articles of incorporation are incorporated by reference as Exhibit 1.1 to this annual
report. For more information on Toyota’s articles of incorporation, please see Item 10.B “Additional Information— Memorandum and Articles of Association.”
ITEM 15. CONTROLS AND PROCEDURES(a) DISCLOSURE CONTROLS AND PROCEDURES
Toyota performed an evaluation of the effectiveness of the design and operation of its disclosure controls
and procedures as of the end of the fiscal 2015. Disclosure controls and procedures are designed to ensure that
information required to be disclosed in the Form 20-F that Toyota files under the Exchange Act is accumulated
and communicated to its management, including the chief executive officer and the principal accounting andfinancial officer, to allow timely decision regarding required disclosure. The disclosure controls and procedures
also ensures that the Form 20-F that it files under the Exchange Act is recorded, processed, summarized andreported within the time periods specified in the Commission’s rules and forms. The evaluation was performed
under the supervision of Toyota’s Chairman of the Board of Directors and the Executive Vice President.
Toyota’s disclosure controls and procedures are designed to provide reasonable assurance of achieving its
objectives. Managerial judgment was necessary to evaluate the cost-benefit relationship of possible controls andprocedures. The Chairman of the Board of Directors and the Executive Vice President have concluded that
Toyota’s disclosure controls and procedures are effective at the reasonable assurance level.
(b) MANAGEMENT’S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIALREPORTING
Toyota’s management is responsible for establishing and maintaining effective internal control overfinancial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes inaccordance with U.S. GAAP. Toyota’s internal control over financial reporting includes those policies andprocedures that:(i)pertain to the maintenance of records that in reasonable detail, accurately and fairly reflect thetransactions and dispositions of Toyota’s assets;(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with U.S. GAAP, and that Toyota’s receipts and expenditures arebeing made only in accordance with authorizations of Toyota’s management and members of the boardof directors; and(iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use,
or disposition of Toyota’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions, or that the degree of compliance with thepolicies or procedures may deteriorate.
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Toyota’s management conducted an evaluation of the effectiveness of internal control over financial
reporting based on the framework in “Internal Control — Integrated Framework (2013)” issued by theCommittee of Sponsoring Organizations of the Treadway Commission.
Based on this evaluation, management concluded that Toyota’s internal control over financial reporting was
effective as of March 31, 2015.
PricewaterhouseCoopers Aarata, an independent registered public accounting firm that audited theconsolidated financial statements included in this report, has also audited the effectiveness of Toyota’s internal
control over financial reporting as of March 31, 2015, as stated in its report included herein.
(c) ATTESTATION REPORT OF THE REGISTERED PUBLIC ACCOUNTING FIRM
Toyota’s independent registered public accounting firm, PricewaterhouseCoopers Aarata, has issued an
audit report on the effectiveness of Toyota’s internal control over financial reporting. This report appears in
Item 18.
(d) CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
There have been no changes in Toyota’s internal control over financial reporting during fiscal 2015 thathave materially affected, or are reasonably likely to materially affect, Toyota’s internal control over financial
reporting.
ITEM 16. [RESERVED]ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
Toyota maintains an audit & supervisory board system, in accordance with the Companies Act. Toyota’s
audit & supervisory board is comprised of six audit & supervisory board members, three of whom are outside
audit & supervisory board members. Each audit & supervisory board member has been appointed at Toyota’s
meetings of shareholders and has certain statutory powers independently, including auditing the business affairs
and accounts of Toyota.
Toyota’s audit & supervisory board has determined that it does not have an “audit committee financial
expert” serving on the audit & supervisory board. The qualifications for, and powers of, the audit & supervisoryboard member delineated in the Companies Act are different from those anticipated for any audit committee
financial expert. Audit & supervisory board members have the authority to be given reports from a certified
public accountant or an accounting firm concerning audits, including technical accounting matters. At the sametime, each audit & supervisory board member has the authority to consult internal and external experts on
accounting matters. Each audit & supervisory board member must fulfill the requirements under Japanese laws
and regulations and otherwise follow Japanese corporate governance practices and, accordingly, Toyota’s
audit & supervisory board has confirmed that it is not necessarily in Toyota’s best interest to nominate as audit &supervisory board member a person who meets the definition of audit committee financial experts. Although
Toyota does not have an audit committee financial expert on its audit & supervisory board, Toyota believes that
Toyota’s current corporate governance system, taken as a whole, including the audit & supervisory board
members’ ability to consult internal and external experts, is fully equivalent to a system having an audit
committee financial expert on its audit & supervisory board.
ITEM 16B. CODE OF ETHICS
Toyota has adopted a code of ethics that applies to its members of the board of directors and managing
officers, including its principal executive officer, principal financial officer, principal accounting officer orcontroller, or persons performing similar functions. A copy of Toyota’s code of ethics is included as an exhibit tothis annual report on Form 20-F.
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ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
PricewaterhouseCoopers Aarata has audited the financial statements of Toyota included in this annual reporton Form 20-F.
The following table presents the aggregate fees for professional services and other services rendered byPricewaterhouseCoopers Aarata and the various network and member firms of PricewaterhouseCoopers to
Toyota in fiscal 2014 and fiscal 2015.
Yen in millions
2014
2015

Audit Fees(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Audit-related Fees(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Tax Fees(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
All Other Fees(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3,619
101
433
139

4,208
127
494
532

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4,292

5,361

(1) Audit Fees consist of fees billed for the annual audit services engagement and other audit services, which
are those services that only the external auditor reasonably can provide, and include the services of annual
audit, quarterly reviews and assessment and reviews of the effectiveness of internal controls over financial
reporting of Toyota and its subsidiaries and affiliated companies; the services associated with SEC
registration statements or other documents issued in connection with securities offerings such as comfort
letters and consents; and consultations as to the accounting or disclosure treatment of transactions or events.
(2) Audit-related Fees consist of fees billed for assurance and related services that are reasonably related to theperformance of the audit or review of its financial statements or that are traditionally performed by theexternal auditor, and mainly include services such as due diligence; agreed-upon or expanded audit
procedures; internal control reviews and assistance; review of the information system; and financial
statement audits of employee benefit plans.
(3) Tax Fees include fees billed for tax compliance services, including services such as tax planning, advice andcompliance of federal, state, local and international tax; the review of tax returns; assistance with tax audits
and appeals; tax-only valuation services including transfer pricing and cost segregation studies; expatriate
tax assistance and compliance.
(4) All Other Fees primarily include fees billed for risk management advisory services of assessment andtesting of security infrastructure controls; services providing information related to automotive market
conditions; IT advisory services; and other advisory services.
Policies and Procedures of the Audit & Supervisory Board
Below is a summary of the current policies and procedures of the audit & supervisory board for the preapproval of audit and permissible non-audit services performed by Toyota’s independent public accountants.
Under the policy, the Representative Directors submit a request for general pre-approval of audit andpermissible non-audit services for the following fiscal year, which shall include details of the specific services
and estimated fees for the services, to the audit & supervisory board, which reviews and determines whether or
not to grant the request by the end of March of the fiscal year. Upon the general pre-approval of the audit &supervisory board, the Representative Directors are not required to obtain any specific pre-approval for audit andpermissible non-audit services so long as those services fall within the scope of the general pre-approval
provided.
The audit & supervisory board makes a further determination of whether or not to grant a request to revise
the general pre-approval for the applicable fiscal year if such request is submitted by the Representative127

Directors. Such request may include (i) adding any audit or permissible non-audit services other than the ones
listed in the general pre-approval and (ii) obtaining services that are listed in the general pre-approval but of
which the total fee amount exceeds the amount affirmed by the general pre-approval. The determination ofwhether or not to grant a request to revise the general pre-approval noted in the foregoing may alternatively bemade by an audit & supervisory board member (full time), who is designated in advance by a resolution of theaudit & supervisory board, in which case such audit & supervisory board member (full time) shall report suchdecision at the next meeting of the audit & supervisory board. The performance of audit and permissible nonaudit services and the payment of fees are subject to review by the audit & supervisory board at least once every
fiscal half year.
ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
Toyota does not have an audit committee. Toyota is relying on the general exemption contained inRule 10A-3(c)(3) under the Exchange Act, which provides an exemption from the NYSE’s listing standards
relating to audit committees for foreign companies like Toyota that have an audit & supervisory board. Toyota’s
reliance on Rule 10A-3(c)(3) does not, in its opinion, materially adversely affect the ability of its audit &supervisory board to act independently and to satisfy the other requirements of Rule 10A-3.
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED
PURCHASERS
The following table sets forth purchases of Toyota’s common stock by Toyota and its affiliated purchasers
during fiscal 2015:

(a)
Total
Number of
SharesPurchased(1)(b)
Average
Price Paid per
Share (Yen)(1)

(c)
Total
Number of
SharesPurchased as
Part of
Publicly
Announced
Plans or
Programs(2)April 1, 2014 – April 30, 2014 . . . . . . . . . . . . . . . . . . . . . .
May 1, 2014 – May 31, 2014 . . . . . . . . . . . . . . . . . . . . . . .
June 1, 2014 – June 30, 2014 . . . . . . . . . . . . . . . . . . . . . . .
July 1, 2014 – July 31, 2014 . . . . . . . . . . . . . . . . . . . . . . . .
August 1, 2014 – August 31, 2014 . . . . . . . . . . . . . . . . . . .
September 1, 2014 – September 30, 2014 . . . . . . . . . . . . . .
October 1, 2014 – October 31, 2014 . . . . . . . . . . . . . . . . . .
November 1, 2014 – November 30, 2014 . . . . . . . . . . . . . .
December 1, 2014 – December 31, 2014 . . . . . . . . . . . . . .
January 1, 2015 – January 31, 2015 . . . . . . . . . . . . . . . . . .
February 1, 2015 – February 28, 2015 . . . . . . . . . . . . . . . .
March 1, 2015 – March 31, 2015 . . . . . . . . . . . . . . . . . . . .

1,263
1,834
1,489
3,906
2,257
2,823
1,389
3,530
4,749
2,159
3,811
5,178

¥5,636.97
5,528.62
5,825.61
6,073.88
6,037.39
6,262.16
6,275.34
6,806.50
7,503.12
7,559.22
7,837.14
8,260.70———
13,583,300
6,204,100
7,828,700
11,308,400
7,375,800
9,221,600
—
—
—

—
—
—
—
—
—
—
—
—
—
—
—

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

34,388—55,521,900—

Period(d)Maximum
Number of
Shares thatMay Yet Be
Purchased
Under thePlans or
Programs(2)(1) A portion of the above purchases were made as a result of holders of shares constituting less than one unit,
which is 100 shares of common stock, requesting Toyota to purchase shares that are a fraction of a unit, in
accordance with Toyota’s share handling regulations. Toyota is required to comply with such requests
pursuant to the Companies Act. See “Additional Information — Memorandum and Articles of Association— Japanese Unit Share System”.
(2) As announced on April 28, 2015, following the issuance of First Series Model AA Class Shares, Toyota
plans to repurchase its own common shares in substantially the same number as the number of shares of128

First Series Model AA Class Shares issued. In addition, as announced on May 8, 2015, after the issuance ofFirst Series Model AA Class Shares until March 31, 2016, Toyota plans to repurchase up to
40,000,000 shares of its own common shares for up to ¥300 billion.
ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT
Not applicable.
ITEM 16G. CORPORATE GOVERNANCE
Significant Differences in Corporate Governance Practices between Toyota and U.S. Companies Listed on
the NYSE
Pursuant to home country practices exemptions granted by the NYSE, Toyota is permitted to follow certain
corporate governance practices complying with Japanese laws, regulations and stock exchange rules in lieu of the
NYSE’s listing standards. The SEC approved changes to the NYSE’s listing standards related to corporate
governance practices of listed companies (the “NYSE Corporate Governance Rules”) in November 2003, as
further amended in November 2004. Toyota is exempt from the approved changes, except for requirements that(a) Toyota’s audit & supervisory board satisfies the requirements of Rule 10A-3 under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), (b) Toyota must disclose significant differences in its corporate
governance practices as compared to those followed by domestic companies under the NYSE listing standards,(c) Toyota’s principal executive officer must notify the NYSE in writing after any executive officer of Toyota
becomes aware of any non-compliance with (a) and (b), and (d) Toyota must submit annual and interim written
affirmations to the NYSE. Toyota’s corporate governance practices and those followed by domestic companies
under the NYSE Corporate Governance Rules have the following significant differences:
1. Members of the Board of Directors. Toyota currently does not have any members of the board of
directors who will be deemed an “independent director” as required under the NYSE Corporate Governance
Rules for U.S. listed companies. Unlike the NYSE Corporate Governance Rules, the Companies Act does not
require Japanese companies with an audit & supervisory board such as Toyota to have any independent directors
on its board of directors. While the NYSE Corporate Governance Rules require that the non-management
directors of each listed company meet at regularly scheduled executive sessions without management, Toyota
currently has no non-management member on its board of directors. Unlike the NYSE Corporate Governance
Rules, the Companies Act does not require, and accordingly Toyota does not have, an internal corporate organ orcommittee comprised solely of independent directors.
Toyota currently has three outside members of the board of directors under the Companies Act. An“outside” member of the board of directors refers to:(a) the person who is not, and has never been during the 10 year period before becoming an outside memberof the board of directors, an executive director (a member of the board of directors who engages in the executionof business), executive officer, manager or employee (collectively, “Executive Director, etc.”) of Toyota or its
subsidiaries;(b) if the person was a member of the board of directors, accounting counselor (in the case that an
accounting counselor is a legal entity, an employee of such entity who is in charge of its affairs) or audit &supervisory board member (excluding those who have ever been Executive Directors, etc.) of Toyota or any of its
subsidiaries at any time during the 10 year period before becoming an outside member of the board of directors,
such person who has not been an Executive Director, etc. of Toyota or any of its subsidiaries during the 10 year
period before becoming a member of the board of directors, accounting counselor or audit & supervisory board
member; and(c) the person who is not a spouse or relative within the second degree of kinship of any member of theboard of directors or manager or other key employee of Toyota.
129

Such qualifications for an “outside” member of the board of directors are different from the director
independence requirements under the NYSE Corporate Governance Rules.
In addition, pursuant to the regulations of the Japanese stock exchanges, Toyota is required to have one ormore “independent director(s)/audit & supervisory board member(s),” defined under the relevant regulations of
the Japanese stock exchanges as “outside directors” or “outside audit & supervisory board members” (as defined
under the Companies Act), who are unlikely to have any conflicts of interests with Toyota’s generalshareholders, and is also required to make efforts to have at least one “independent director(s)/audit &supervisory board member(s)” who is also a director. Each of the outside members of the board of directors of
Toyota satisfies the “independent director/audit & supervisory board member” requirements under the
regulations of the Japanese stock exchanges. Japan’s Corporate Governance Code provides that companies
should appoint at least two “independent outside directors” as defined based on the criteria for assessing director
independence established by Toyota in line with the independence standards of the Japanese stock exchanges.
Each of the outside members of the board of directors of Toyota satisfies the “independent outside director”
requirements under the criteria for assessing director independence established by Toyota. The definition of“independent director/audit & supervisory board member” and “independent outside director” is different fromthat of the definition of independent director under the NYSE Corporate Governance Rules.
2. Committees. Under the Companies Act, Toyota has elected to structure its corporate governance system
as a company with audit & supervisory board members who are under a statutory duty to monitor, review andreport on the management of the affairs of Toyota. Toyota, as with other Japanese companies with an audit &supervisory board, does not have certain committees that are required of U.S. listed companies subject to the
NYSE Corporate Governance Rules, including those that are responsible for director nomination, corporate
governance and executive compensation.
Pursuant to the Companies Act, Toyota’s board of directors nominates and submits a proposal for theappointment of members of the board of directors for shareholder approval. The shareholders vote on suchnomination at the general shareholders’ meeting. The Companies Act requires that the limits or calculation
formula and kind (in case that the remuneration, bonus and any other benefits in compensation for the executionof duties (“remuneration, etc.”) are to be paid in other than cash) of remuneration, etc. to be paid to directors aswell as limits of remuneration, etc. to be paid to audit & supervisory board members must be determined by aresolution of the general shareholders’ meeting, unless their remuneration, etc. is provided for in the articles ofincorporation. The distribution of remuneration, etc. among each member of the board of directors is broadly
delegated to the board of directors and the distribution of remuneration among each audit & supervisory board
member is determined by consultation among the audit & supervisory board members.
3. Audit Committee. Toyota avails itself of paragraph (c)(3) of Rule 10A-3 of the Exchange Act, which
provides a general exemption from the audit committee requirements to a foreign private issuer with an audit &supervisory board, subject to certain requirements which continue to be applicable under Rule 10A-3.
Pursuant to the requirements of the Companies Act, Toyota elects its audit & supervisory board members
through a resolution adopted at a general shareholders’ meeting. Toyota currently has six audit & supervisoryboard members, which exceeds the minimum number of audit & supervisory board members required pursuant to
the Companies Act.
Unlike the NYSE Corporate Governance Rules, the Companies Act, among others, does not require audit &supervisory board members to establish an expertise in accounting or financial management nor are they required
to present other special knowledge and experience. Therefore, none of Toyota’s audit & supervisory board
members has “an expertise in accounting or financial management” as set forth in the NYSE Corporate
Governance Rules. The Japanese Corporate Governance Code indicates that one or more audit & supervisoryboard members who have appropriate knowledge of finance and accounting matters should be appointed. Toyota
has appointed persons who are able to provide opinions and advice regarding management based on their broader
130experience and discretion beyond finance and accounting. Under the Companies Act, the audit & supervisoryboard may determine the auditing policies and methods of investigating the conditions of Toyota’s business andassets, and may resolve other matters concerning the execution of the audit & supervisory board member’s
duties. The audit & supervisory board also prepares auditors’ reports, gives consent to proposals of thenomination of audit & supervisory board members and makes decisions concerning proposals relating to theappointment and dismissal of accounting auditors.
Toyota currently has three outside audit & supervisory board members under the Companies Act. Under theCompanies Act, at least half of the audit & supervisory board members must be an “outside” audit & supervisoryboard member, which is any person who satisfies all of the following requirements:(a) the person has never been a member of the board of directors, accounting counselor (in the case that an
accounting counselor is a legal entity, an employee of such entity who is in charge of its affairs),
executive officer, manager or employee of Toyota or its subsidiaries during the 10 year period before
becoming an outside audit & supervisory board member;(b) if the person was an audit & supervisory board member of Toyota or any of its subsidiaries at any time
during the 10 year period before becoming an outside audit & supervisory board member, such person
has not been a member of the board of directors, accounting counselor (in the case that an accounting
counselor is a legal entity, an employee of such entity who is in charge of its affairs), executive officer,
manager or employee of Toyota or any of its subsidiaries during the 10 year period before becoming anaudit & supervisory board member of Toyota or any of its subsidiaries; and(c) the person is not a spouse or relative within the second degree of kinship of any member of the boardof directors or manager or other key employee of Toyota.
Such qualifications for an “outside” audit & supervisory board member are different from the audit
committee independence requirement under the NYSE Corporate Governance Rules.
Each of the outside audit & supervisory board members of Toyota satisfies the “independent director/
audit & supervisory board member” requirements under the regulations of the Japanese stock exchanges, as
described above in “1. Members of the Board of Directors.”
4. Corporate Governance Guidelines. Unlike the NYSE Corporate Governance Rules, Toyota is not
required to adopt Japan’s Corporate Governance Code under Japanese laws and regulations, including theCompanies Act, the Financial Instruments and Exchange Law of Japan and stock exchange rules. However, if
Toyota does not comply with Japan’s Corporate Governance Code, it is required to explain the reasons why itdoes not do so in accordance with the regulations of the Japanese stock exchanges. In addition, Toyota isrequired to resolve at the board of directors matters relating to a system, which is required under the ordinance ofthe Ministry of Justice (“internal control system” or “naibu-tosei”), to ensure the execution of duties of themembers of the board of directors to comply with laws, regulations and articles of incorporation, and any othersystems to ensure the adequacy of the business, and to disclose such matters resolved, policies and the present
status of its corporate governance in its business reports, annual securities report and certain other disclosure
documents in accordance with the regulations under the Financial Instruments and Exchange Law and stock
exchange rules in respect of timely disclosure.
5. Code of Business Conduct and Ethics. Similar to the NYSE Corporate Governance Rules, under Japan’s
Corporate Governance Code, Toyota is encouraged to adopt a code of conduct regarding ethical businessactivities for members of the board of directors, officers and employees. Toyota has resolved matters relating tomaintenance of an “internal control system”, or “naibu-tosei,” in order to ensure its employees comply with laws,
regulations and the articles of incorporation, etc. pursuant to the Companies Act, and Toyota maintains
guidelines and internal regulations such as “Guiding Principles at Toyota”, “Toyota Code of Conduct” and a codeof ethics pursuant to Section 406 of the Sarbanes-Oxley Act. Please see “Code of Ethics” for additional
information.
131

6. Shareholder Approval of Equity Compensation Plans. Unlike the NYSE Corporate Governance Rules,
under which material revisions to equity-compensation plans of listed companies are subject to shareholder
approval, pursuant to the Companies Act, generally, the adoption of equity compensation plans for members of
the board of directors is required to be approved by a majority of shareholders at the general shareholders’meeting for remuneration, etc. other than in cash. In addition to such approval, if Toyota desires to adopt anequity-compensation plan under which stock acquisition rights are granted on specially favorable terms to therecipient (except where such rights are granted to all of its shareholders on a pro-rata basis at the same time),
Toyota obtains approval by super-majority (as defined in the Companies Act) at the ordinary generalshareholders’ meeting. Such approval is applicable only to stock acquisition rights to be granted within one year
from the date of the approval.
ITEM 16H. MINE SAFETY DISCLOSURE
Not applicable.

132

PART IIIITEM 17. FINANCIAL STATEMENTS
Not applicable.
ITEM 18. FINANCIAL STATEMENTS
The following financial statements are filed as part of this annual report on Form 20-F.

133

TOYOTA MOTOR CORPORATIONINDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Page

Report of Independent Registered Public Accounting Firm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-2

Consolidated balance sheets at March 31, 2014 and 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-3

Consolidated statements of income for the years ended
March 31, 2013, 2014 and 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-5

Consolidated statements of comprehensive income for the years ended
March 31, 2013, 2014 and 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-6

Consolidated statements of shareholders’ equity for the years ended
March 31, 2013, 2014 and 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-7

Consolidated statements of cash flows for the years ended
March 31, 2013, 2014 and 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-9Notes to consolidated financial statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-10

All financial statements schedules are omitted because they are not applicable or the required information isshown in the financial statements or the notes thereto.
Financial statements of 50% or less owned persons accounted for by the equity method have been omitted
because the registrant’s proportionate share of the income from continuing operations before income taxes is lessthan 20% of consolidated income from continuing operations before income taxes and the investment in andadvances to each company is less than 20% of consolidated total assets.

F-1

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 consolidated financial statements listed in the accompanying index present fairly, in allmaterial respects, the financial position of Toyota Motor Corporation and its subsidiaries at March 31, 2014 and2015, and the results of their operations and their cash flows for each of the three years in the period ended
March 31, 2015 in conformity with accounting principles generally accepted in the United States of America.
Also in our opinion, the Company maintained, in all material respects, effective internal control over financial
reporting as of March 31, 2015, based on criteria established in Internal Control—Integrated Framework(2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The
Company’s management is responsible for these financial statements, for maintaining effective internal control
over financial reporting and for its assessment of the effectiveness of internal control over financial reporting,included in Management’s Annual Report on Internal Control Over Financial Reporting appearing under
Item 15(b). Our responsibility is to express opinions on these financial statements and on the Company’s internal
control over financial reporting based on our integrated audits. We conducted our audits in accordance with thestandards of the Public Company Accounting Oversight Board (United States). Those standards require that weplan and perform the audits to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement and whether effective internal control over financial reporting was maintained in allmaterial respects. Our audits of the financial statements included examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the accounting principles used and significant
estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal
control over financial reporting included obtaining an understanding of internal control over financial reporting,assessing the risk that a material weakness exists, and testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk. Our audits also included performing such otherprocedures as we considered necessary in the circumstances. We believe that our audits provide a reasonablebasis for our opinions.
A company’s internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes inaccordance with generally accepted accounting principles. A company’s internal control over financial reporting
includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail,accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financial statements in accordancewith generally accepted accounting principles, and that receipts and expenditures of the company are being madeonly in accordance with authorizations of management and directors of the company; and (iii) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of thecompany’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions, or that the degree of compliance with thepolicies or procedures may deteriorate.
/s/ PricewaterhouseCoopers Aarata
Nagoya, Japan
June 24, 2015

F-2

TOYOTA MOTOR CORPORATIONCONSOLIDATED BALANCE SHEETSYen in millions
March 31,
2014
2015

AssetsCurrent assets
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Time deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Marketable securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Trade accounts and notes receivable, less allowance for doubtful accountsof ¥18,780 million in 2014 and ¥40,849 million in 2015 . . . . . . . . . . . . .
Finance receivables, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . .

2,041,170
180,2072,046,877

2,284,557
149,321
2,782,099

2,036,232
5,628,934
351,182
1,894,704
866,386
672,014

2,108,660
6,269,862
420,708
2,137,618
978,179
805,393

Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

15,717,706

17,936,397

Noncurrent finance receivables, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8,102,294

9,202,531

Investments and other assets
Marketable securities and other securities investments . . . . . . . . . . . . . . . .
Affiliated companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Employees receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6,765,043
2,429,778
44,966736,388

7,632,126
2,691,460
45,206926,391

Total investments and other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9,976,175

11,295,183

Property, plant and equipment
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Vehicles and equipment on operating leases . . . . . . . . . . . . . . . . . . . . . . . .
Construction in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,314,040
4,073,335
10,381,285
3,709,560
286,571

1,354,815
4,282,839
10,945,377
5,199,986
581,412

Total property, plant and equipment, at cost . . . . . . . . . . . . . . . . . . . . 19,764,791 22,364,429
Less - Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (12,123,493) (13,068,710)
Total property, plant and equipment, net . . . . . . . . . . . . . . . . . . . . . . .

7,641,298

9,295,719

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

41,437,473

47,729,830

The accompanying notes are an integral part of these consolidated financial statements.
F-3

TOYOTA MOTOR CORPORATIONCONSOLIDATED BALANCE SHEETSYen in millions
March 31,
2014
2015

Liabilities
Current liabilities
Short-term borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current portion of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4,830,820
2,949,663
2,213,218
845,426
2,313,160
594,829
933,569

5,048,188
3,915,304
2,410,588
913,0132,668,666
348,786
1,126,951

Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

14,680,685

16,431,496

Long-term liabilities
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued pension and severance costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8,546,910
767,618
1,811,846
411,427

10,014,395
880,2932,298,469
457,848

Total long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

11,537,801

13,651,005

Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

26,218,486

30,082,501

397,050
551,308
14,116,295
528,161

397,050547,054
15,591,947
1,477,545(1,123,666)(1,225,465)

Total Toyota Motor Corporation shareholders’ equity . . . . . . . . . . . .

14,469,148

16,788,131

Noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

749,839

859,198

Total shareholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

15,218,987

17,647,329

Commitments and contingencies
Total liabilities and shareholders’ equity . . . . . . . . . . . . . . . . . . . . . . .

41,437,473

47,729,830

Shareholders’ equity
Toyota Motor Corporation shareholders’ equity
Common stock, no par value,authorized: 10,000,000,000 shares in 2014 and 2015;
issued: 3,447,997,492 shares in 2014 and 3,417,997,492 shares in2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accumulated other comprehensive income (loss) . . . . . . . . . . . . . . . . . . . .
Treasury stock, at cost, 278,231,473 shares in 2014 and
271,183,861 shares in 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The accompanying notes are an integral part of these consolidated financial statements.
F-4

TOYOTA MOTOR CORPORATIONCONSOLIDATED STATEMENTS OF INCOME
Yen in millions
For the years ended March 31,
2013
2014
2015

Net revenues
Sales of products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Costs and expenses
Cost of products sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cost of financing 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 affiliatedcompanies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity in earnings of affiliated companies . . . . . . . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - Net income attributable to noncontrolling interests . . . . . . . . . . . .
Net income attributable to Toyota Motor Corporation . . . . . . .

20,914,150
1,150,042
22,064,192

24,312,644
1,379,267
25,691,911

25,612,836
1,621,685
27,234,521

18,010,569
630,426
2,102,309
20,743,304
1,320,888

19,988,245
812,8942,598,660
23,399,799
2,292,112

20,916,362
925,3142,642,281
24,483,957
2,750,564

98,673(22,967)
5,551
1,504
82,761

115,410(19,630)
50,2602,928
148,968

147,122(22,871)
88,140(70,127)
142,264

1,403,649
551,686
231,519
1,083,482(121,319)
962,1632,441,080
767,808
318,376
1,991,648(168,529)
1,823,119

2,892,828
893,469
308,545
2,307,904(134,566)
2,173,338

Yen

Net income attributable to Toyota Motor Corporation per share- Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

303.82575.30688.02- Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

303.78574.92687.66

Cash dividends per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

90.00

165.00200.00

The accompanying notes are an integral part of these consolidated financial statements.
F-5

TOYOTA MOTOR CORPORATIONCONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Yen in millions
For the years ended March 31,
2013
2014
2015

Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments . . . . . . . . . . . . . . . . . . . . . . . .
Unrealized gains (losses) on securities . . . . . . . . . . . . . . . . . . . . . . . . . .
Pension liability adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,083,482

1,991,648

2,307,904

461,754374,209
14,711

301,889
499,560
99,404404,352
577,703
4,316

Total other comprehensive income (loss) . . . . . . . . . . . . . . . . . . . . . . . .

850,674

900,853

986,371

Comprehensive income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,934,156

2,892,501

3,294,275

Less - Comprehensive income attributable to noncontrolling interests . . . . .

(149,283)(185,098)(171,553)

Comprehensive income attributable to Toyota Motor Corporation . . . .

1,784,873

2,707,403

3,122,722

The accompanying notes are an integral part of these consolidated financial statements.
F-6

TOYOTA MOTOR CORPORATIONCONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
Yen in millions
Total
Accumulated
Toyota Motor
Additional
other
Treasury Corporation
Total
Common paid-in
Retained comprehensive stock, shareholders’ Noncontrolling shareholders’stockcapitalearnings income (loss)
at costequityinterests
equityBalances at March 31, 2012 . . . . . . . . . . 397,050
Equity transaction with noncontrollinginterests and other . . . . . . . . . . . . . . . . .
Comprehensive income
Net income . . . . . . . . . . . . . . . . . . . .
Other comprehensive income (loss)
Foreign currency translation
adjustments . . . . . . . . . . . . . .
Unrealized gains (losses) on
securities . . . . . . . . . . . . . . . .
Pension liability adjustments . .

550,650

11,917,074(1,178,833)(1,135,680) 10,550,261

516,217

11,066,478

675

4,961

5,636

962,163

121,319

1,083,482

434,638

434,638

27,116

461,754368,507
19,565368,507
19,565

5,702(4,854)374,209
14,711

1,784,873

149,283

1,934,156

675
962,163

Total comprehensive income . . . . . .
Dividends paid to Toyota Motor
Corporation shareholders . . . . . . . . . . .
Dividends paid to noncontrollinginterests . . . . . . . . . . . . . . . . . . . . . . . .
Repurchase and reissuance of treasury
stock . . . . . . . . . . . . . . . . . . . . . . . . . . .
Balances at March 31, 2013 . . . . . . . . . . 397,050
Equity transaction with noncontrollinginterests and other . . . . . . . . . . . . . . . . .
Comprehensive income
Net income . . . . . . . . . . . . . . . . . . . .
Other comprehensive income (loss)
Foreign currency translation
adjustments . . . . . . . . . . . . . .
Unrealized gains (losses) on
securities . . . . . . . . . . . . . . . .
Pension liability adjustments . .

(190,008)(190,008)(45,640)

(285)

(23)

551,040

12,689,206

2,542(356,123)

Balances at March 31, 2014 . . . . . . . . . . 397,050

12,772,856

528

2,985

3,513

1,823,119

168,529

1,991,648

296,942296,942

4,947

301,889493,750
93,592493,750
93,592

5,810
5,812

499,560
99,404

2,707,403

185,098

2,892,501

1,823,119(396,030)(396,030)

(260)

9,472
14,116,295

2,234
624,821528

551,308

2,234

528,161(396,030)(63,065)(63,065)

749,839

15,218,987

9,212(1,123,666) 14,469,148

9,212

The accompanying notes are an integral part of these consolidated financial statements.
F-7(45,640)(1,133,138) 12,148,035

Total comprehensive income . . . . . .
Dividends paid to Toyota Motor
Corporation shareholders . . . . . . . . . . .
Dividends paid to noncontrollinginterests . . . . . . . . . . . . . . . . . . . . . . . .
Repurchase and reissuance of treasury
stock . . . . . . . . . . . . . . . . . . . . . . . . . . .

(190,008)

TOYOTA MOTOR CORPORATIONCONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (CONTINUED)
Yen in millions
Total
Accumulated
Toyota Motor
Additional
other
Treasury Corporation
Total
Common paid-in
Retained comprehensive stock, shareholders’ Noncontrolling shareholders’stockcapitalearnings income (loss)
at costequityinterests
equityBalances at March 31, 2014 . . . . . . . . . . 397,050
Equity transaction with noncontrollinginterests and other . . . . . . . . . . . . . . . . .
Comprehensive income
Net income . . . . . . . . . . . . . . . . . . . .
Other comprehensive income (loss)
Foreign currency translation
adjustments . . . . . . . . . . . . . .
Unrealized gains (losses) on
securities . . . . . . . . . . . . . . . .
Pension liability adjustments . .

551,308

14,116,295

528,161(1,123,666) 14,469,148

749,839

15,218,987

(422)

7,101

6,679

2,173,338

134,566

2,307,904

380,448

380,448

23,904404,352

567,002
1,934

567,002
1,934

10,701
2,382

577,703
4,316

3,122,722

171,553

3,294,275(422)
2,173,338

Total comprehensive income . . . . . .
Dividends paid to Toyota Motor
Corporation shareholders . . . . . . . . . . .
Dividends paid to noncontrollinginterests . . . . . . . . . . . . . . . . . . . . . . . .
Repurchase of treasury stock . . . . . . . . . .
Reissuance of treasury stock . . . . . . . . . .
Retirement of treasury stock . . . . . . . . . .

(2,136)(1,696)(23,290)(119,463)

Balances at March 31, 2015 . . . . . . . . . . 397,050

547,054

15,591,947(554,933)(554,933)(360,233)
137,275
121,159
1,477,545(554,933)(69,295)(69,295)(360,233)
111,849—

859,198

17,647,329(360,233)
111,849—(1,225,465) 16,788,131

The accompanying notes are an integral part of these consolidated financial statements.
F-8

TOYOTA MOTOR CORPORATIONCONSOLIDATED STATEMENTS OF CASH FLOWS
Yen in millions
For the years ended March 31,
2013
2014
2015

Cash flows from operating activities
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,083,482
1,991,648
2,307,904
Adjustments to reconcile net income to net cash provided by operating
activities
Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,105,109
1,250,853
1,409,075
Provision for doubtful accounts and credit losses . . . . . . . . . . . . . . .
27,36749,71878,969Pension and severance costs, less payments . . . . . . . . . . . . . . . . . . .
(20,429)
20,654(3,161)
Losses on disposal of fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . .
32,221
28,657
31,625
Unrealized losses on available-for-sale securities, net . . . . . . . . . . . .
2,104
6,197
2,578
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
160,008(56,279)(26,887)
Equity in earnings of affiliated companies . . . . . . . . . . . . . . . . . . . .
(231,519)(318,376)(308,545)
Changes in operating assets and liabilities, and other
Increase in accounts and notes receivable . . . . . . . . . . . . . . . . .
(168,260)(121,926)(69,477)(Increase) decrease in inventories . . . . . . . . . . . . . . . . . . . . . . .
50,483(110,819)(171,001)
Increase in other current assets . . . . . . . . . . . . . . . . . . . . . . . . .
(47,033)(77,645)(43,355)
Increase (decrease) in accounts payable . . . . . . . . . . . . . . . . . .
(209,284)
65,312150,058
Increase (decrease) in accrued income taxes . . . . . . . . . . . . . . .
22,127438,527(246,043)
Increase in other current liabilities . . . . . . . . . . . . . . . . . . . . . . .
280,083
277,659494,254
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
364,857
201,855
79,759Net cash provided by operating activities . . . . . . . . . . . . .
2,451,316
3,646,035
3,685,753
Cash flows from investing activities
Additions to finance receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (10,004,928) (11,953,064) (13,126,596)
Collection of finance receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9,063,011 10,990,546 12,426,475
Proceeds from sales of finance receivables . . . . . . . . . . . . . . . . . . . . . . . .
39,84534,807
23,913
Additions to fixed assets excluding equipment leased to others . . . . . . . .
(854,561)(970,021) (1,146,318)
Additions to equipment leased to others . . . . . . . . . . . . . . . . . . . . . . . . . . (1,119,591) (1,708,670) (2,211,250)
Proceeds from sales of fixed assets excluding equipment leased toothers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
39,19139,191
41,547
Proceeds from sales of equipment leased to others . . . . . . . . . . . . . . . . . .
533,441
744,339
803,423
Purchases of marketable securities and security investments . . . . . . . . . . (3,412,423) (4,738,278) (3,194,294)
Proceeds from sales of marketable securities and security investments . .
35,178538,894
113,348
Proceeds upon maturity of marketable securities and security
investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,633,913
2,780,433
2,569,653
Payment for additional investments in affiliated companies, net of cash
acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
16,2166,603—
Changes in investments and other assets, and other . . . . . . . . . . . . . . . . .
3,396(101,028)(113,391)
Net cash used in investing activities . . . . . . . . . . . . . . . . . (3,027,312) (4,336,248) (3,813,490)
Cash flows from financing activities
Proceeds from issuance of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . .
3,191,223
3,890,310
5,029,018
Payments of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,682,136) (2,988,923) (3,462,237)
Increase (decrease) in short-term borrowings . . . . . . . . . . . . . . . . . . . . . .
201,261
467,976(288,724)
Dividends paid to Toyota Motor Corporation shareholders . . . . . . . . . . .
(190,008)(396,030)(554,933)
Dividends paid to noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . .
(45,640)(63,065)(69,295)
Reissuance (repurchase) of treasury stock . . . . . . . . . . . . . . . . . . . . . . . . .
2,542
9,212
(347,784)
Net cash provided by financing activities . . . . . . . . . . . . .
477,242
919,480
306,045
Effect of exchange rate changes on cash and cash equivalents . . . . . . . . . . . . .
137,851
93,60665,079Net increase in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
39,097
322,873
243,387
Cash and cash equivalents at beginning of year . . . . . . . . . . . . . . . . . . . . . . . .
1,679,200
1,718,297
2,041,170
Cash and cash equivalents at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,718,297
2,041,170
2,284,557

The accompanying notes are an integral part of these consolidated financial statements.
F-9

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Nature of operations:Toyota and its affiliated companies are primarily engaged in the design, manufacture, and sale of sedans,
minivans, compact cars, sport-utility vehicles, trucks and related parts and accessories throughout the world. In
addition, Toyota and its affiliated companies provide financing, vehicle and equipment leasing and certain otherfinancial services primarily to its dealers and their customers to support the sales of vehicles and other products
manufactured by Toyota and its affiliated companies.
2. Summary of significant accounting policies:
The parent company and its subsidiaries in Japan and its foreign subsidiaries maintain their records andprepare their financial statements in accordance with Japanese generally accepted accounting principles andthose of their countries of domicile. Certain adjustments and reclassifications have been incorporated in theaccompanying consolidated financial statements to conform to U.S.GAAP.
Significant accounting policies after reflecting adjustments for the above are as follows:
Basis of consolidation and accounting for investments in affiliated companies The consolidated financial statements include the accounts of the parent company, its majority-owned
subsidiary companies and variable interest entities of which Toyota is the primary beneficiary. All significant
intercompany transactions and accounts have been eliminated. Investments in affiliated companies in which
Toyota exercises significant influence, but which it does not control, are stated at cost plus equity inundistributed earnings. Consolidated net income includes Toyota’s equity in current earnings of such companies,
after elimination of unrealized intercompany profits. Investments in such companies are reduced to net realizablevalue if a decline in market value is determined other-than-temporary. Investments in non-public companies inwhich Toyota does not exercise significant influence (generally less than a 20% ownership interest) are stated atcost.
Estimates The preparation of Toyota’s consolidated financial statements in conformity with U.S.GAAP requires
management to make estimates and assumptions that affect the amounts reported in the consolidated financial
statements and accompanying notes. Actual results could differ from those estimates. The more significant
estimates include: product warranties, liabilities accrued for recalls and other safety measures, allowance for
doubtful accounts and credit losses, residual values for leased assets, impairment of long-lived assets, pension
costs and obligations, fair value of derivative financial instruments, other-than-temporary losses on marketablesecurities, litigation liabilities and valuation allowance for deferred tax assets.
Translation of foreign currencies All asset and liability accounts of foreign subsidiaries and affiliated companies are translated into Japanese
yen at appropriate year-end current exchange rates and all income and expense accounts of those subsidiaries aretranslated at the average exchange rates for each period. The foreign currency translation adjustments areincluded as a component of accumulated other comprehensive income.
Foreign currency receivables and payables are translated at appropriate year-end current exchange rates andthe resulting transaction gains or losses are recorded in operations currently.

F-10

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Revenue recognition Revenues from sales of vehicles and parts are generally recognized upon delivery which is considered tohave occurred when the dealer has taken title to the product and the risk and reward of ownership have been
substantively transferred, except as described below.
Toyota’s sales incentive programs principally consist of cash payments to dealers calculated based on
vehicle volume or a model sold by a dealer during a certain period of time. Toyota accrues these incentives asrevenue reductions upon the sale of a vehicle corresponding to the program by the amount determined in therelated incentive program.
Revenues from the sales of vehicles under which Toyota conditionally guarantees the minimum resale value
are recognized on a pro rata basis from the date of sale to the first exercise date of the guarantee in a manner
similar to operating lease accounting. The underlying vehicles of these transactions are recorded as assets and are
depreciated in accordance with Toyota’s depreciation policy.
Revenues from retail financing contracts and finance leases are recognized using the effective yield method.
Revenues from operating leases are recognized on a straight-line basis over the lease term.
The sale of certain vehicles includes a determinable amount for the contract, which entitles customers tofree vehicle maintenance. Such revenues from free maintenance contracts are deferred and recognized as revenue
over the period of the contract, which approximates the pattern of the related costs.
Other costs Advertising and sales promotion costs are expensed as incurred. Advertising costs were ¥330,870 million,¥419,409 million and ¥435,150 million for the years ended March 31, 2013, 2014 and 2015, respectively.
Toyota generally warrants its products against certain manufacturing and other defects. Provisions for
product warranties are provided for specific periods of time and/or usage of the product and vary depending upon
the nature of the product, the geographic location of the sale and other factors. Toyota records a provision for
estimated product warranty costs at the time the related sale is recognized based on estimates that Toyota will
incur to repair or replace product parts that fail while under warranty. The amount of accrued estimated warranty
costs is primarily based on historical experience as to product failures as well as current information on repair
costs. The amount of warranty costs accrued also contains an estimate of warranty claim recoveries to bereceived from suppliers.
In addition to product warranties above, Toyota accrues for costs of recalls and other safety measures basedon management’s estimates when it is probable a liability has been incurred and the amount of loss can bereasonably estimated. Toyota employs an estimation model, to accrue at the time of vehicle sale, an amount that
represents management’s best estimate of expenses related to future recalls and other safety measures. The
estimation model for recalls and other safety measures takes into account Toyota’s historical experience ofrecalls and other safety measures.
Litigation liabilities are established to cover probable losses on various lawsuits based on the information
currently available. Attorneys’ fees are expensed as incurred.
Research and development costs are expensed as incurred. Research and development costs were¥807,454 million, ¥910,517 million and ¥1,004,547 million for the years ended March 31, 2013, 2014 and 2015,
respectively.
F-11

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Cash and cash equivalents Cash and cash equivalents include all highly liquid investments with original maturities of three months or
less, that are readily convertible to known amounts of cash and are so near maturity that they present
insignificant risk of changes in value because of changes in interest rates.
Marketable securities Marketable securities consist of debt and equity securities. Debt and equity securities designated asavailable-for-sale are carried at fair value with unrealized gains or losses included as a component ofaccumulated other comprehensive income in shareholders’ equity, net of applicable taxes. Individual securities
classified as available-for-sale are reduced to net realizable value for other-than-temporary declines in market
value. In determining if a decline in value is other-than-temporary, Toyota considers the length of time and theextent to which the fair value has been less than the carrying value, the financial condition and prospects of thecompany and Toyota’s ability and intent to retain its investment in the company for a period of time sufficient toallow for any anticipated recovery in market value. Realized gains and losses, which are determined on the
average-cost method, are reflected in the consolidated statements of income when realized.
Security investments in non-public companies Security investments in non-public companies are carried at cost as fair value is not readily determinable. If
the value of a non-public security investment is estimated to have declined and such decline is judged to beother-than-temporary, Toyota recognizes the impairment of the investment and the carrying value is reduced toits fair value. Determination of impairment is based on the consideration of such factors as operating results,business plans and estimated future cash flows. Fair value is determined principally through the use of the latest
financial information.
Finance receivables Finance receivables recorded on Toyota’s consolidated balance sheets are comprised of the unpaid principalbalance, plus accrued interest, less charge-offs, net of any unearned income and deferred origination costs andthe allowance for credit losses. Deferred origination costs are amortized so as to approximate a level rate of
return over the term of the related contracts.
The determination of portfolio segments is based primarily on the qualitative consideration of the nature of
Toyota’s business operations and finance receivables. The three portfolio segments within finance receivables are
as follows:
Retail receivables portfolio segment The retail receivables portfolio segment consists of retail installment sales contracts acquired mainly fromdealers (“auto loans”) including credit card loans. These contracts acquired must first meet specified credit
standards. Thereafter, Toyota retains responsibility for contract collection and administration.
The contract periods of auto loans primarily range from 2 to 7 years. Toyota acquires security interests inthe vehicles financed and has the right to repossess vehicles if customers fail to meet their contractual
obligations. Almost all auto loans are non-recourse, which relieves the dealers from financial responsibility in theevent of repossession.
F-12

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Toyota classifies retail receivables portfolio segment into one class based on common risk characteristics
associated with the underlying finance receivables, the similarity of the credit risks, and the quantitative
materiality.
Finance lease receivables portfolio segment Toyota acquires new vehicle lease contracts originated primarily through dealers. The contract periods ofthese primarily range from 2 to 5 years. Lease contracts acquired must first meet specified credit standards after
which Toyota assumes ownership of the leased vehicle. Toyota is responsible for contract collection andadministration during the lease period.
Toyota is generally permitted to take possession of the vehicle upon a default by the lessee. The residual
value is estimated at the time the vehicle is first leased. Vehicles returned to Toyota at the end of their leases are
sold by auction.
Toyota classifies finance lease receivables portfolio segment into one class based on common risk
characteristics associated with the underlying finance receivables and the similarity of the credit risks.
Wholesale and other dealer loan receivables portfolio segment Toyota provides wholesale financing to qualified dealers to finance inventories. Toyota acquires security
interests in vehicles financed at wholesale. In cases where additional security interests would be required, Toyota
takes dealership assets or personal assets, or both, as additional security. If a dealer defaults, Toyota has the rightto liquidate any assets acquired and seek legal remedies.
Toyota also makes term loans to dealers for business acquisitions, facilities refurbishment, real estatepurchases and working capital requirements. These loans are typically secured with liens on real estate, otherdealership assets and/or personal assets of the dealers.
Toyota classifies wholesale and other dealer loan receivables portfolio segment into three classes ofwholesale, real estate and working capital, based on the risk characteristics associated with the underlying
finance receivables.
A receivable account balance is considered impaired when, based on current information and events, it isprobable that Toyota will be unable to collect all amounts due according to the terms of the contract. Factors suchas payment history, compliance with terms and conditions of the underlying loan agreement and other subjective
factors related to the financial stability of the borrower are considered when determining whether a loan is
impaired. Impaired finance receivables include certain nonaccrual receivables for which a specific reserve has
been assessed. An account modified as a troubled debt restructuring is considered to be impaired. A troubled debt
restructuring occurs when an account is modified through a concession to a borrower experiencing financial
difficulty.
All classes of wholesale and other dealer loan receivables portfolio segment are placed on nonaccrual statuswhen full payment of principal or interest is in doubt, or when principal or interest is 90 days or more
contractually past due, whichever occurs first. Collateral dependent loans are placed on nonaccrual status if
collateral is insufficient to cover principal and interest. Interest accrued but not collected at the date a receivable
is placed on nonaccrual status is reversed against interest income. In addition, the amortization of net deferredfees is suspended.
F-13

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Interest income on nonaccrual receivables is recognized only to the extent it is received in cash. Accounts
are restored to accrual status only when interest and principal payments are brought current and future payments
are reasonably assured. Receivable balances are written-off against the allowance for credit losses when it isprobable that a loss has been realized. Retail receivables class and finance lease receivables class are not placed
generally on nonaccrual status when principal or interest is 90 days or more past due. However, these receivables
are generally written-off against the allowance for credit losses when payments due are no longer expected to bereceived or the account is 120 days contractually past due, whichever occurs first.
As of March 31, 2014 and 2015, finance receivables on nonaccrual status are as follows:
Yen in millions
March 31,
2014
2015

Retail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Finance leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Wholesale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Working capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5,962
780
1,406
4,035
46

7,629
5,562
11,5738,592
446

12,22933,802As of March 31, 2014 and 2015, finance receivables 90 days or more past due and accruing are as follows:
Yen in millions
March 31,
2014
2015

Retail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Finance leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

23,352
3,504

28,147
3,954

26,85632,101

Allowance for credit losses Allowance for credit losses is established to cover probable losses on finance receivables and vehicles andequipment on operating leases, resulting from the inability of customers to make required payments. Provision
for credit losses is included in selling, general and administrative expenses.
The allowance for credit losses is based on a systematic, ongoing review and evaluation performed as partof the credit-risk evaluation process, historical loss experience, the size and composition of the portfolios, current
economic events and conditions, the estimated fair value and adequacy of collateral and other pertinent factors.
Vehicles and equipment on operating leases are not within the scope of accounting guidance governing thedisclosure of portfolio segments.
Retail receivables portfolio segment Toyota calculates allowance for credit losses to cover probable losses on retail receivables by applying
reserve rates to such receivables. Reserve rates are calculated mainly by historical loss experience, current
economic events and conditions and other pertinent factors.
F-14

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Finance lease receivables portfolio segment Toyota calculates allowance for credit losses to cover probable losses on finance lease receivables byapplying reserve rates to such receivables. Reserve rates are calculated mainly by historical loss experience,current economic events and conditions and other pertinent factors such as used car markets.
Wholesale and other dealer loan receivables portfolio segment Toyota calculates allowance for credit losses to cover probable losses on wholesale and other dealer loan
receivables by applying reserve rates to such receivables. Reserve rates are calculated mainly by financial
conditions of the dealers, terms of collateral setting, current economic events and conditions and other pertinent
factors.
Toyota establishes specific reserves to cover the estimated losses on individually impaired receivables
within the wholesale and other dealer loan receivables portfolio segment. Specific reserves on impaired
receivables are determined by the present value of expected future cash flows or the fair value of collateral when
it is probable that such receivables will be unable to be fully collected. The fair value of the underlying collateralis used if the receivable is collateral-dependent. The receivable is determined collateral-dependent if therepayment of the loan is expected to be provided by the underlying collateral. For the receivables in which thefair value of the underlying collateral was in excess of the outstanding balance, no allowance was provided.
Troubled debt restructurings in the retail receivables and finance lease receivables portfolio segments are
specifically identified as impaired and aggregated with their respective portfolio segments when determining theallowance for credit losses. Impaired loans in the retail receivables and finance lease receivables portfolio
segments are insignificant for individual evaluation and Toyota has determined that allowance for credit losses
for each of the retail receivables and finance lease receivables portfolio segments would not be materiallydifferent if they had been individually evaluated for impairment.
Specific reserves on impaired receivables within the wholesale and other dealer loan receivables portfolio
segment are recorded by an increase to the allowance for credit losses based on the related measurement of
impairment. Related collateral, if recoverable, is repossessed and sold and the account balance is written-off.
Any shortfall between proceeds received and the carrying cost of repossessed collateral is charged to theallowance. Recoveries are reversed from the allowance for credit losses.
Allowance for residual value losses Toyota is exposed to risk of loss on the disposition of off-lease vehicles to the extent that sales proceeds are
not sufficient to cover the carrying value of the leased asset at lease termination. Toyota maintains an allowanceto cover probable estimated losses related to unguaranteed residual values on its owned portfolio. The allowanceis evaluated considering projected vehicle return rates and projected loss severity. Factors considered in thedetermination of projected return rates and loss severity include historical and market information on used
vehicle sales, trends in lease returns and new car markets, and general economic conditions. Management
evaluates the foregoing factors, develops several potential loss scenarios, and reviews allowance levels todetermine whether reserves are considered adequate to cover the probable range of losses.
The allowance for residual value losses is maintained in amounts considered by Toyota to be appropriate inrelation to the estimated losses on its owned portfolio. Upon disposal of the assets, the allowance for residual
losses is adjusted for the difference between the net book value and the proceeds from sale.
F-15

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Inventories Inventories are valued at cost, not in excess of market, cost being determined on the “average-cost” basis,
except for the cost of finished products carried by certain subsidiary companies which is determined on the“specific identification” basis or “last-in, first-out” (“LIFO”) basis. Inventories valued on the LIFO basis totaled¥323,249 million and ¥402,180 million at March 31, 2014 and 2015, respectively. Had the “first-in, first-out”
basis been used for those companies using the LIFO basis, inventories would have been ¥46,244 million and¥39,165 million higher than reported at March 31, 2014 and 2015, respectively.
Property, plant and equipment Property, plant and equipment are stated at cost. Major renewals and improvements are capitalized; minor
replacements, maintenance and repairs are charged to current operations. Depreciation of property, plant andequipment is mainly computed on the declining-balance method for the parent company and Japanesesubsidiaries and on the straight-line method for foreign subsidiary companies at rates based on estimated useful
lives of the respective assets according to general class, type of construction and use. The estimated useful lives
range from 2 to 65 years for buildings and from 2 to 20 years for machinery and equipment.
Vehicles and equipment on operating leases to third parties are originated by dealers and acquired by certain
consolidated subsidiaries. Such subsidiaries are also the lessors of certain property that they acquire directly.
Vehicles and equipment on operating leases are depreciated primarily on a straight-line method over the leaseterm, generally from 2 to 5 years, to the estimated residual value. Incremental direct costs incurred in connection
with the acquisition of operating lease contracts are capitalized and amortized on a straight-line method over thelease term.
Long-lived assets Toyota reviews its long-lived assets for impairment whenever events or changes in circumstances indicatethat the carrying amount of an asset group may not be recoverable. An impairment loss would be recognizedwhen the carrying amount of an asset group exceeds the estimated undiscounted cash flows expected to result
from the use of the asset and its eventual disposition. The amount of the impairment loss to be recorded is
calculated by the excess of the carrying value of the asset group over its fair value. Fair value is determined
mainly using a discounted cash flow valuation method.
Goodwill and intangible assets Goodwill is not material to Toyota’s consolidated balance sheets.
Intangible assets consist mainly of software. Intangible assets with a definite life are amortized on a straightline basis with estimated useful lives mainly of 5 years. Intangible assets with an indefinite life are tested for
impairment whenever events or circumstances indicate that a carrying amount of an asset (asset group) may not
be recoverable.
An impairment loss would be recognized when the carrying amount of an asset exceeds the estimatedundiscounted cash flows used in determining the fair value of the asset. The amount of the impairment loss to berecorded is generally determined by the difference between the fair value of the asset using a discounted cash
flow valuation method and the current book value.

F-16

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Employee benefit obligations Toyota has both defined benefit and defined contribution plans for employees’ retirement benefits.
Retirement benefit obligations are measured by actuarial calculations in accordance with U.S.GAAP. The funded
status of the defined benefit postretirement plans is recognized on the consolidated balance sheets as prepaid
pension and severance costs or accrued pension and severance costs, and the funded status change is recognizedin the year in which it occurs through other comprehensive income.
Environmental matters Environmental expenditures relating to current operations are expensed or capitalized as appropriate.
Expenditures relating to existing conditions caused by past operations, which do not contribute to current or
future revenues, are expensed. Liabilities for remediation costs are recorded when they are probable andreasonably estimable, generally no later than the completion of feasibility studies or Toyota’s commitment to aplan of action. The cost of each environmental liability is estimated by using current technology available andvarious engineering, financial and legal specialists within Toyota based on current law. Such liabilities do notreflect any offset for possible recoveries from insurance companies and are not discounted. There were nomaterial changes in these liabilities for all periods presented.
Income taxes The provision for income taxes is computed based on the pretax income included in the consolidated
statements of income. The asset and liability approach is used to recognize deferred tax assets and liabilities forthe expected future tax consequences of temporary differences between the carrying amounts and the tax bases ofassets and liabilities. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than
not that a tax benefit will not be realized.
Derivative financial instruments Toyota employs derivative financial instruments, including forward foreign currency exchange contracts,
foreign currency options, interest rate swaps, interest rate currency swap agreements and interest rate options tomanage its exposure to fluctuations in interest rates and foreign currency exchange rates. All derivative financial
instruments are recorded on the consolidated balance sheets at fair value, taking into consideration the effects oflegally enforceable master netting agreements that allow us to net settle positive and negative positions and offset
cash collateral held with the same counterparty on a net basis. Toyota does not use derivatives for speculation or
trading purposes. Changes in the fair value of derivatives are recorded each period in current earnings or throughother comprehensive income, depending on whether a derivative is designated as part of a hedge transaction andthe type of hedge transaction. The ineffective portion of all hedges is recognized currently in operations.
Net income attributable to Toyota Motor Corporation per share Basic net income attributable to Toyota Motor Corporation per common share is calculated by dividing net
income attributable to Toyota Motor Corporation by the weighted-average number of shares outstanding during
the reported period. The calculation of diluted net income attributable to Toyota Motor Corporation per commonshare is similar to the calculation of basic net income attributable to Toyota Motor Corporation per share, exceptthat the weighted-average number of shares outstanding includes the additional dilution from the assumed
exercise of dilutive stock options.

F-17

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Stock-based compensation Toyota measures compensation expense for its stock-based compensation plan based on the grant-date fairvalue of the award, and accounts for the award.
Other comprehensive income Other comprehensive income refers to revenues, expenses, gains and losses that, under U.S.GAAP are
included in comprehensive income, but are excluded from net income as these amounts are recorded directly as
an adjustment to shareholders’ equity. Toyota’s other comprehensive income is primarily comprised of
unrealized gains/losses on marketable securities designated as available-for-sale, foreign currency translation
adjustments and adjustments attributed to pension liabilities associated with Toyota’s defined benefit pension
plans.
Accounting changes In July 2013, the FASB issued updated guidance on uncertain tax positions. This guidance requires anunrecognized tax benefit, or a portion of an unrecognized tax benefit, to be presented in the financial statements
as a reduction to a deferred tax asset for a net operating loss carryforward for tax purposes, a similar tax loss, or a
tax credit carryforward. Toyota adopted this guidance on April 1, 2014. The adoption of this guidance did nothave a material impact on Toyota’s consolidated financial statements.
Recent pronouncements to be adopted in future periods In May 2014, the FASB issued updated guidance on the recognition of revenue from contracts withcustomers. This guidance will supersede the current revenue recognition guidance. This guidance is effective forannual reporting periods beginning after December 15, 2016, including interim periods within that reporting
period. Management is evaluating the impact of adopting this guidance on Toyota’s consolidated financial
statements.
In February 2015, the FASB issued updated guidance that amends the analysis a reporting entity must
perform to determine whether it should consolidate certain legal entities. This guidance is effective for fiscal
years, and for interim periods within those fiscal years, beginning after December 15, 2015. Management isevaluating the impact of adopting this guidance on Toyota’s consolidated financial statements.
In April 2015, the FASB issued updated guidance that requires debt issuance costs related to a recognizeddebt liability be presented in the balance sheet as a direct deduction from the carrying amount of the related debt
liability instead of being presented as an asset. This guidance is effective for fiscal years beginning after
December 15, 2015, and interim periods within those fiscal years. Management is evaluating the impact of
adopting this guidance on Toyota’s consolidated financial statements.
In April 2015, the FASB issued updated guidance to help entities evaluate the accounting for fees paid by acustomer in a cloud computing arrangement. This guidance is effective for annual periods, including interim
periods within those annual periods, beginning after December 15, 2015. Management is evaluating the impact of
adopting this guidance on Toyota’s consolidated financial statements.
Reclassifications Certain prior year amounts have been reclassified to conform to the presentations as of and for the year
ended March 31, 2015.
F-18

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
3. Supplemental cash flow information:
Cash payments for income taxes were ¥331,007 million, ¥411,133 million and ¥1,145,808 million for theyears ended March 31, 2013, 2014 and 2015, respectively. Interest payments during the years ended March 31,
2013, 2014 and 2015 were ¥325,575 million, ¥352,590 million and ¥369,770 million, respectively.
Capital lease obligations of ¥3,749 million, ¥3,422 million and ¥3,709 million were incurred for the years
ended March 31, 2013, 2014 and 2015, respectively.
4. Acquisitions and dispositions:
During the years ended March 31, 2013, 2014 and 2015, Toyota made several acquisitions and dispositions,however the assets and liabilities acquired or transferred were not material.
5. Marketable securities and other securities investments:
Marketable securities and other securities investments include public and corporate bonds and common
stocks for which the aggregate cost, gross unrealized gains and losses and fair value are as follows:

Cost

Yen in millions
March 31, 2014
Gross
Gross
unrealized
unrealized
gains
lossesFair
value

Available-for-sale
Public and corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . 5,879,336
Common stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
619,811
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
538,306

290,964
1,377,653
34,076

5,377
268
49

6,164,923
1,997,196
572,333

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,037,453

1,702,693

5,694

8,734,452

Securities not practicable to determine fair value
Public and corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . .
Common stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

433
77,035

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

77,468Cost

Yen in millions
March 31, 2015
Gross
Gross
unrealized
unrealized
gains
lossesFair
value

Available-for-sale
Public and corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . 6,848,348
Common stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
621,750
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
387,085

337,341
2,083,164
43,649

4,738
100
12

7,180,951
2,704,814
430,722

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,857,183

2,464,154

4,850

10,316,487

Securities not practicable to determine fair value
Public and corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . .
Common stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

20,404
77,334

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

97,738

F-19

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Public and corporate bonds included in available-for-sale represent 50% of Japanese bonds, and 50% of
U.S., European and other bonds as of March 31, 2014, and 43% of Japanese bonds, and 57% of U.S., European
and other bonds as of March 31, 2015. Listed stocks on the Japanese stock markets represent 86% and 88% ofcommon stocks which are included in available-for-sale as of March 31, 2014 and 2015, respectively. Public andcorporate bonds include government bonds, and “Other” includes investment trusts.
Unrealized losses continuing over a 12 month period or more in the aggregate were not material at
March 31, 2014 and 2015.
As of March 31, 2014 and 2015, maturities of public and corporate bonds included in available-for-sale aremainly from 1 to 10 years.
Proceeds from sales of available-for-sale securities were ¥35,178 million, ¥538,894 million and¥113,348 million for the years ended March 31, 2013, 2014 and 2015, respectively. On those sales, gross realized
gains were ¥1,048 million, ¥25,099 million and ¥17,912 million and gross realized losses were ¥31 million,¥404 million and ¥161 million, respectively.
During the years ended March 31, 2013, 2014 and 2015, Toyota recognized impairment losses on availablefor-sale securities of ¥2,104 million, ¥6,197 million and ¥2,578 million, respectively, which are included in“Other income (loss), net” and other in the accompanying consolidated statements of income.
In the ordinary course of business, Toyota maintains long-term investment securities, included in“Marketable securities and other securities investments” and issued by a number of non-public companies which
are recorded at cost, as their fair values were not readily determinable. Management employs a systematic
methodology to assess the recoverability of such investments by reviewing the financial viability of theunderlying companies and the prevailing market conditions in which these companies operate to determine if
Toyota’s investment in each individual company is impaired and whether the impairment is other-thantemporary. Toyota periodically performs this impairment test for significant investments recorded at cost. If theimpairment is determined to be other-than-temporary, the carrying value of the investment is written-down by the
impaired amount and the losses are recognized currently in operations.

F-20

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
6. Finance receivables:
Finance receivables consist of the following:
Yen in millions
March 31,
2014
2015

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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10,523,364
1,071,179
2,875,650

14,470,193 16,298,284
161,956
179,905(754,539)(837,124)

Total allowance for credit losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total finance receivables, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - Current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent finance receivables, net . . . . . . . . . . . . . . . . . . . . . . . . . . . .

12,015,844
1,158,361
3,124,079(89,439)(30,585)(26,358)(109,316)(29,303)(30,053)(146,382)(168,672)

13,731,228 15,472,393(5,628,934) (6,269,862)
8,102,294

9,202,531

Finance receivables were geographically distributed as follows: in North America 57.1%, in Asia 11.4%, in
Europe 10.8%, in Japan 8.9% and in Other 11.8% as of March 31, 2014, and in North America 59.3%, in Asia
12.8%, in Europe 9.5%, in Japan 7.9% and in Other 10.5% as of March 31, 2015.
The contractual maturities of retail receivables, the future minimum lease payments on finance leases andthe contractual maturities of wholesale and other dealer loans at March 31, 2015 are summarized as follows:
Yen in millions

Years ending March 31,

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-21

RetailFinanceleasesWholesaleand other
dealer loans

3,990,339
2,947,412
2,303,402
1,548,457
792,183
434,051

305,178
225,863
171,359
94,78130,905
7,405

2,284,565
282,667
193,257
145,660
96,535
121,395

12,015,844

835,491

3,124,079

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Finance leases consist of the following:
Yen in millions
March 31,
2014
2015

Minimum lease payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Estimated unguaranteed residual values . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred origination costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - Unearned income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - Allowance for credit losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

781,736
289,443

835,491
322,870

1,071,179 1,158,361
4,592
4,791
(89,627)(98,915)(30,585)(29,303)

Finance leases, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

955,559

1,034,934

Toyota is exposed to credit risk on Toyota’s finance receivables. Credit risk is the risk of loss arising fromthe failure of customers or dealers to meet the terms of their contracts with Toyota or otherwise fail to perform asagreed. Toyota estimates allowance for credit losses by variety of credit-risk evaluation process to cover probableand estimable losses above.
The table below shows the amount of the finance receivables segregated into aging categories based on thenumber of days outstanding as of March 31, 2014 and 2015:
Yen in millions
March 31, 2014
RetailCurrent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,366,261
30-59 days past due . . . . . . . . . . . . . . . . . . . . . . . . . .
105,056
60-89 days past due . . . . . . . . . . . . . . . . . . . . . . . . . .
22,82490 days or greater past due . . . . . . . . . . . . . . . . . . . .
29,223
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10,523,364

FinanceleasesWholesale

Real estate

Working
capital1,062,194
3,396
1,490
4,099

1,434,534
8—
20739,659525
70—

700,819——15

1,071,179

1,434,562

740,254

700,834

Yen in millions
March 31, 2015
RetailCurrent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,821,070
30-59 days past due . . . . . . . . . . . . . . . . . . . . . . . . . .
129,649
60-89 days past due . . . . . . . . . . . . . . . . . . . . . . . . . .
29,55290 days or greater past due . . . . . . . . . . . . . . . . . . . .
35,573
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

12,015,844

F-22

FinanceleasesWholesale

Real estate

Working
capital1,147,488
4,179
1,985
4,709

1,540,395
2——854,79170—
26

728,689——106

1,158,361

1,540,397

854,887

728,795

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The tables below show the recorded investment for each credit quality of the finance receivable within thewholesale and other dealer loan receivables portfolio segment in the United States and other regions as ofMarch 31, 2014 and 2015:
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: Account not classified as either Credit Watch, At Risk or Default
Credit Watch: Account designated for elevated attention
At Risk: Account where there is an increased likelihood that default may exist based on qualitative andquantitative factors
Default: Account is not currently meeting contractual obligations or we have temporarily waived certain
contractual requirements

Wholesale

Yen in millions
March 31, 2014
Real estate Working capital

Performing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Credit Watch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
At Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

836,703
131,934
2,441
58

390,218
88,032
1,247—

169,027
16,233
2,556
616

1,395,948
236,199
6,244
674

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

971,136

479,497

188,432

1,639,065

Wholesale

Yen in millions
March 31, 2015
Real estate Working capital

Performing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Credit Watch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
At Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

960,542
136,537
7,230
4,340

454,451
101,2214,476
482

197,369
21,197
3,806
273

1,612,362
258,955
15,512
5,095

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,108,649

560,630

222,645

1,891,924

Total

Total

Other regions
Credit qualities of the wholesale and other dealer loan receivables portfolio segment in other regions arealso monitored based on internal risk assessments by dealers on a consistent basis as in the United States. These
accounts classified as “Credit Watch” or “At Risk” were not significant in other regions, and consequently thetables below summarize information for two categories, “Performing” and “Default”.

Wholesale

Yen in millions
March 31, 2014
Real estate Working capital

Performing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

460,946
2,480

259,056
1,701

511,855547

1,231,857
4,728

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

463,426

260,757

512,402

1,236,585

F-23

Total

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Wholesale

Yen in millions
March 31, 2015
Real estate Working capital

Performing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

428,8892,859

292,0072,250

505,675475

1,226,571
5,584

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

431,748

294,257

506,150

1,232,155

Total

The tables below summarize information about impaired finance receivables:
Recorded investment
March 31,
2014
2015

Yen in millions
Unpaid principal balance
March 31,
2014
2015

Individually evaluated allowance
March 31,
2014
2015

Impaired account balances individually evaluated for impairment with an allowance:
Wholesale . . . . . . . . . . . . . .
4,745
11,8104,745
11,810483
Real estate . . . . . . . . . . . . . .
4,476
8,136
4,476
8,136
1,421
Working capital . . . . . . . . .
2,977
4,881
2,977
4,881
2,720
Total . . . . . . . . . . . . . .

12,19824,827

12,19824,8274,624

Impaired account balances individually evaluated for impairment without an allowance:
Wholesale . . . . . . . . . . . . . .
5,217
13,644
5,217
13,644
Real estate . . . . . . . . . . . . . .
9,257
10,935
9,257
10,935Working capital . . . . . . . . .
384
312
384
312
Total . . . . . . . . . . . . . .

14,85824,891

14,85824,891

Impaired account balances aggregated and evaluated for impairment:
Retail . . . . . . . . . . . . . . . . .
34,17932,90733,66132,541
Finance leases . . . . . . . . . . .
177
118
168
104
Total . . . . . . . . . . . . . .

34,35633,02533,82932,645

Total impaired account balances:
Retail . . . . . . . . . . . . . . . . .
34,179Finance leases . . . . . . . . . . .
177
Wholesale . . . . . . . . . . . . . .
9,962
Real estate . . . . . . . . . . . . . .
13,733
Working capital . . . . . . . . .
3,361

32,907
118
25,454
19,071
5,193

33,661
168
9,962
13,733
3,361

32,541
104
25,454
19,071
5,193

Total . . . . . . . . . . . . . .

82,74360,88582,363

61,412

F-24

2,387
2,054
4,376
8,817

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Yen in millions
Average impaired
Interest income
finance receivables
recognized
For the years ended March 31,
For the years ended March 31,
2014
2015
2014
2015

Total impaired account balances:
Retail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Finance leases . . . . . . . . . . . . . . . . . . . . . . .
Wholesale . . . . . . . . . . . . . . . . . . . . . . . . . .
Real estate . . . . . . . . . . . . . . . . . . . . . . . . . .
Working capital . . . . . . . . . . . . . . . . . . . . . .

37,997175
14,464
15,201
4,591

33,722
155
13,977
14,634
3,813

2,760
6
100
501
200

2,389
4
110
439
110

Total . . . . . . . . . . . . . . . . . . . . . . . . . .

72,42866,301

3,567

3,052

The amount of finance receivables modified as a troubled debt restructuring for the year ended March 31,
2015 was not significant for all classes of finance receivables. Finance receivables modified as troubled debt
restructurings for the year ended March 31, 2015 and for which there was a payment default were not significant
for all classes of such receivables.
7. Other receivables:
Other receivables relate to arrangements with certain component manufacturers whereby Toyota procuresinventory for these component manufactures and is reimbursed for the related purchases.
8. Inventories:
Inventories consist of the following:
Yen in millions
March 31,
2014
2015

Finished goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,159,762
Raw materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
384,635Work in process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
258,133
Supplies and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
92,174
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-25

1,894,704

1,365,818
401,040
270,113
100,647
2,137,618

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
9. Vehicles and equipment on operating leases:
Vehicles and equipment on operating leases consist of the following:
Yen in millions
March 31,
2014
2015

Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - Deferred income and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3,674,969
129,029(94,438)

Less - Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - Allowance for credit losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3,709,560 5,199,986(808,764) (1,080,936)(7,220)(9,366)

Vehicles and equipment on operating leases, net . . . . . . . . . . . . . . . . . . . . . . . . .

2,893,576

5,169,524
163,195(132,733)

4,109,684

Rental income from vehicles and equipment on operating leases was ¥476,935 million, ¥586,983 millionand ¥726,515 million for the years ended March 31, 2013, 2014 and 2015, respectively. Future minimum rentals
from vehicles and equipment on operating leases are due in installments as follows:
Years ending March 31,

Yen in millions

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

728,864
461,905
200,318
50,092
11,587
1,633

Total minimum future rentals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,454,399

The future minimum rentals as shown above should not be considered indicative of future cash collections.
10. Allowance for doubtful accounts and credit losses:
The net changes in the allowance for doubtful accounts relating to trade accounts and notes receivable forthe years ended March 31, 2013, 2014 and 2015 are as follows:
Yen in millions
For the years ended March 31,
2013
2014
2015

Allowance for doubtful accounts at beginning of year . . . . . . . . . . . . . . . . . . .
Provision for doubtful accounts, net of reversal . . . . . . . . . . . . . . . . . . . . . . . .
Write-offs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

44,097
1,745
(457)
759

46,144
3,405(1,162)(869)

47,518(1,598)
(289)
4,779

Allowance for doubtful accounts at end of year . . . . . . . . . . . . . . . . . . . .

46,14447,51850,410“Other” includes the impact of currency translation adjustments for the years ended March 31, 2013, 2014
and 2015.
F-26

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
A portion of the allowance for doubtful accounts balance at March 31, 2014 and 2015 totaling¥28,738 million and ¥9,561 million, respectively, is attributed to certain non-current receivable balances which
are reported as “Other” assets in the consolidated balance sheets.
The net changes in the allowance for credit losses relating to finance receivables and vehicles andequipment on operating leases for the years ended March 31, 2013, 2014 and 2015 are as follows:
Yen in millions
For the years ended March 31,
2013
2014
2015

Allowance for credit losses at beginning of year . . . . . . . . . . . . . . . . . . . . . . . .
Provision for credit losses, net of reversal . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Charge-offs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

140,363
25,622(56,701)
14,69023,075147,049
46,313(65,359)
16,662
8,937

153,60280,567(84,310)
18,173
10,006

Allowance for credit losses at end of year . . . . . . . . . . . . . . . . . . . . . . . . .

147,049

153,602

178,038“Other” primarily includes the impact of currency translation adjustments for the years ended March 31,
2013, 2014 and 2015.
The net changes in the allowance for credit losses above relating to retail receivables portfolio segment,
finance lease receivables portfolio segment and wholesale and other dealer loan receivables portfolio segment for
the years ended March 31, 2013, 2014 and 2015 are as follows:
Yen in millions
For the year ended March 31, 2013
Wholesale andRetailFinance leases other dealer loans

Allowance for credit losses at beginning of year . . . . . . . . . . . . . . . . . .
Provision for credit losses, net of reversal . . . . . . . . . . . . . . . . . . . . . . .
Charge-offs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

77,35329,079(48,528)
12,795
13,15930,637(4,063)(2,775)590
4,539

24,238(2,006)
(110)
3
4,118

Allowance for credit losses at end of year . . . . . . . . . . . . . . . . . . .

83,85828,92826,243

Yen in millions
For the year ended March 31, 2014
Wholesale andRetailFinance leases other dealer loans

Allowance for credit losses at beginning of year . . . . . . . . . . . . . . . . . .
Provision for credit losses, net of reversal . . . . . . . . . . . . . . . . . . . . . . .
Charge-offs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

83,85842,055(55,733)
14,051
5,208

28,9281,847(2,554)587
1,777

26,243
(807)
(626)
16
1,532

Allowance for credit losses at end of year . . . . . . . . . . . . . . . . . . .

89,43930,58526,358

F-27

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Yen in millions
For the year ended March 31, 2015
Wholesale andRetailFinance leases other dealer loans

Allowance for credit losses at beginning of year . . . . . . . . . . . . . . . . . .
Provision for credit losses, net of reversal . . . . . . . . . . . . . . . . . . . . . . .
Charge-offs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

89,43970,129(71,403)
15,0086,143

30,585(858)(2,568)497
1,647

26,358
2,531
(603)
78
1,689

Allowance for credit losses at end of year . . . . . . . . . . . . . . . . . . .

109,316

29,30330,053

11. Affiliated companies and variable interest entities:
Investments in and transactions with affiliated companies Summarized financial information for affiliated companies accounted for by the equity method is shown
below:
Yen in millions
March 31,
2014
2015

Current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,813,254 11,380,649
Noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,172,524 11,890,150
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,985,778 23,270,799
Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term liabilities and noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Affiliated companies accounted for by the equity method shareholders’ equity . . . . . . .

7,120,877
5,217,723
8,647,178

7,330,762
5,965,242
9,974,795

Total liabilities and shareholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,985,778 23,270,799
Toyota’s share of affiliated companies accounted for by the equity method
shareholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,429,576

2,691,222

Number of affiliated companies accounted for by the equity method at end of period . .

54

54

Yen in millions
For the years ended March 31,
2013
2014
2015

Net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

24,242,046

28,289,687

30,163,457

Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,620,892

3,385,048

3,614,946

Net income attributable to affiliated companies accounted for by theequity method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

705,249

963,003

966,133

Equity in earnings of affiliated companies attributable to Toyota Motor
Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

231,519

318,376

308,545

F-28

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Entities comprising a significant portion of Toyota’s investment in affiliated companies and percentage ofownership are presented below:
Percentage of ownership
March 31,
2014
2015

Name of affiliated companies

Denso Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Toyota Industries Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Aisin Seiki Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Toyota Tsusho Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Toyoda Gosei Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

24.9%
24.7%
23.4%
22.0%
43.0%

24.9%
24.6%
23.3%
22.0%
43.0%

Certain affiliated companies accounted for by the equity method with carrying amounts of¥1,811,245 million and ¥2,010,249 million at March 31, 2014 and 2015, respectively, were quoted on various
established markets at an aggregate value of ¥2,320,128 million and ¥2,889,079 million, respectively. Toyota
evaluated its investments in affiliated companies, considering the length of time and the extent to which thequoted market prices have been less than the carrying amounts, the financial condition and near-term prospectsof the affiliated companies and Toyota’s ability and intent to retain those investments in the companies for aperiod of time. Toyota did not recognize any impairment loss for the years ended March 31, 2013, 2014 and2015.
Account balances and transactions with affiliated companies are presented below:
Yen in millions
March 31,
2014
2015

Trade accounts and notes receivable, and other receivables . . . . . . . . . . . . . . . . . . . . . . . .
Accounts payable and other payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

253,312599,334

266,999
635,878

Yen in millions
For the years ended March 31,
2013
2014
2015

Net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,926,854
4,020,138

1,854,708
4,289,583

1,785,238
5,065,613

Dividends from affiliated companies accounted for by the equity method for the years ended March 31,
2013, 2014 and 2015 were ¥126,977 million, ¥147,039 million and ¥174,485 million, respectively.
Toyota does not have any significant related party transactions other than transactions with affiliatedcompanies in the ordinary course of business.
Variable Interest Entities Toyota enters into securitization transactions using special-purpose entities, that are considered variableinterest entities (“VIEs”). Although the finance receivables and vehicles on operating leases related tosecuritization transactions have been legally sold to the VIEs, Toyota has both the power to direct the activitiesof the VIEs that most significantly impact the VIEs’ economic performance and the obligation to absorb losses of
the VIEs or the right to receive benefits from the VIEs that could potentially be significant to the VIEs. As aresult, Toyota is considered the primary beneficiary of the VIEs and therefore consolidates the VIEs.
F-29

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Related to securitization transactions, ¥1,439,796 million and ¥1,845,092 million retail finance receivables,¥16,447 million and ¥144,729 million vehicles on operating leases, ¥84,052 million and ¥112,004 million
restricted cash and ¥1,205,293 million and ¥1,572,185 million secured debt were included in Toyota’s
consolidated financial statements as of March 31, 2014 and 2015, respectively. The creditors of the VIEs do nothave recourse to Toyota’s general credit with the exception of debts guaranteed by Toyota. Risks to which
Toyota is exposed including credit, interest rate, and/or prepayment risks are not incremental compared with thesituation before Toyota enters into securitization transactions.
As for VIEs other than those specified above, neither the aggregate size nor Toyota’s involvements arematerial to Toyota’s consolidated financial statements.
12. Short-term borrowings and long-term debt:
Short-term borrowings at March 31, 2014 and 2015 consist of the following:
Yen in millions
March 31,
2014
2015

Loans, principally from banks, with a weighted-average interest at March 31, 2014 andMarch 31, 2015 of 2.57% and of 2.83% per annum, respectively . . . . . . . . . . . . . . . . .
Commercial paper with a weighted-average interest at March 31, 2014 and March 31,
2015 of 0.49% and of 0.41% per annum, respectively . . . . . . . . . . . . . . . . . . . . . . . . . .

1,165,580

1,167,792

3,665,240

3,880,396

4,830,820

5,048,188

As of March 31, 2015, Toyota has unused short-term lines of credit amounting to ¥2,070,086 million ofwhich ¥729,454 million related to commercial paper programs. Under these programs, Toyota is authorized toobtain short-term financing at prevailing interest rates for periods not in excess of 360 days.

F-30

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Long-term debt at March 31, 2014 and 2015 comprises the following:
Yen in millions
March 31,
2014
2015

Unsecured loans, representing obligations principally to banks, due 2014 to 2029 in2014 and due 2015 to 2029 in 2015 with interest ranging from 0.00% to39.50% per annum in 2014 and from 0.01% to 39.50% per annum in 2015 . . . . . . .
Secured loans, representing obligations principally to finance receivables
securitization due 2014 to 2030 in 2014 and due 2015 to 2030 in 2015 with interest
ranging from 0.10% to 12.00% per annum in 2014 and from 0.10% to 2.92% perannum in 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Medium-term notes of consolidated subsidiaries, due 2014 to 2047 in 2014 and due2015 to 2047 in 2015 with interest ranging from 0.10% to 9.40% per annum in2014 and from 0.13% to 9.40% per annum in 2015 . . . . . . . . . . . . . . . . . . . . . . . . . .
Unsecured notes of parent company, due 2014 to 2023 in 2014 and due 2015 to 2024
in 2015 with interest ranging from 0.19% to 3.00% per annum in 2014 and from
0.19% to 3.00% per annum in 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unsecured notes of consolidated subsidiaries, due 2014 to 2031 in 2014 and due 2015
to 2032 in 2015 with interest ranging from 0.08% to 41.79% per annum in 2014
and from 0.03% to 41.79% per annum in 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Secured notes of consolidated subsidiaries, due 2016 to 2018 in 2015 with interest
ranging from 8.40% to 9.55% per annum in 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term capital lease obligations, due 2014 to 2030 in 2014 and due 2015 to 2030
in 2015 with interest ranging from 0.50% to 14.73% per annum in 2014 and from
0.50% to 14.73% per annum in 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - Current portion due within one year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3,368,711

3,712,598

1,226,080

1,594,489

5,355,176

6,740,355

400,000

380,000

1,124,810

1,469,218—

13,58021,796

19,45911,496,573 13,929,699(2,949,663) (3,915,304)
8,546,910

10,014,395

As of March 31, 2015, approximately 48%, 12%, 8% and 32% of long-term debt are denominated in U.S.
dollars, Japanese yen, Australian dollars and other currencies, respectively.
As of March 31, 2015, property, plant and equipment with a book value of ¥192,329 million and otherassets aggregating ¥1,875,174 million were pledged as collateral mainly for certain debt obligations ofsubsidiaries. These other assets principally consist of securitized finance receivables.
The aggregate amounts of annual maturities of long-term debt during the next five years are as follows:
Years ending March 31,

2016
2017
2018
2019
2020

Yen in millions......................................................................
......................................................................
......................................................................
......................................................................
......................................................................

F-31

3,915,304
2,380,969
2,867,620
1,690,587
1,718,136

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Standard agreements with certain banks include provisions that collateral (including sums on deposit withsuch banks) or guarantees will be furnished upon the banks’ request and that any collateral furnished, pursuant tosuch agreements or otherwise, will be applicable to all present or future indebtedness to such banks. During theyear ended March 31, 2015, Toyota has not received any significant requests from these banks.
As of March 31, 2015, Toyota has unused long-term lines of credit amounting to ¥8,980,430 million.
13. Product warranties and recalls and other safety measures:
Toyota provides product warranties for certain defects mainly resulting from manufacturing based on
warranty contracts with its customers at the time of sale of products. Toyota accrues estimated warranty costs to
be incurred in the future in accordance with the warranty contracts. In addition to product warranties, Toyota
initiates recalls and other safety measures to repair or to replace parts which might be expected to fail fromproducts safety perspectives or customer satisfaction standpoints. Toyota accrues for costs of recalls and othersafety measures at the time of vehicle sale based on the amount estimated from historical experience.
Liabilities for product warranties and liabilities for recalls and other safety measures have been combined
into a single table showing an aggregate liability for quality assurances due to the fact that both are liabilities forcosts to repair or replace defects of vehicles and the amounts incurred for recalls and other safety measures may
affect the amounts incurred for product warranties and vice versa.
Liabilities for quality assurances are included in “Accrued expenses” in the consolidated balance sheets.
The net changes in liabilities for quality assurances above for the years ended March 31, 2013, 2014 and2015 consist of the following:
Yen in millions
For the years ended March 31,
2013
2014
2015

Liabilities for quality assurances at beginning of year . . . . . . . . . . . . . . . . . .
Payments made during year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Provision for quality assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changes relating to pre-existing quality assurances . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

839,834 1,003,023 1,154,021(344,279) (383,572) (509,488)
491,542
524,442
686,006(8,383)(7,248)(25,619)
24,30917,37623,996

Liabilities for quality assurances at end of year . . . . . . . . . . . . . . . . . . . . . . .

1,003,023

1,154,021

1,328,916“Other” primarily includes the impact of currency translation adjustments and the impact of consolidationand deconsolidation of certain entities due to changes in ownership interest.

F-32

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The table below shows the net changes in liabilities for recalls and other safety measures which arecomprised in liabilities for quality assurances above for the years ended March 31, 2013, 2014 and 2015.
Yen in millions
For the years ended March 31,
2013
2014
2015

Liabilities for recalls and other safety measures at beginning of year . . . .
Payments made during year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Provision for recalls and other safety measures . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

468,697(180,925)
270,883
7,751

566,406(207,652)
315,574
6,147

680,475(357,447)
421,618
10,404

Liabilities for recalls and other safety measures at end of year . . . . . . . . .

566,406

680,475755,050

14. Other payables:
Other payables are mainly related to purchases of property, plant and equipment and non-manufacturing
purchases.
15. Income taxes:
The components of income before income taxes comprise the following:
Yen in millions
For the years ended March 31,
2013
2014
2015

Income before income taxes:
Parent company and domestic subsidiaries . . . . . . . . . . . . . . . . . . . . .
Foreign subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

651,852
751,797

1,621,013
820,067

1,685,909
1,206,919

1,403,649

2,441,080

2,892,828

The provision for income taxes consists of the following:
Yen in millions
For the years ended March 31,
2013
2014
2015

Current income tax expense:
Parent company and domestic subsidiaries . . . . . . . . . . . . . . . . . . . . .
Foreign subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

178,662
213,016

634,458
189,629552,122368,234

Total current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

391,678824,087

920,356

Deferred income tax expense (benefit):
Parent company and domestic subsidiaries . . . . . . . . . . . . . . . . . . . . .
Foreign subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

140,041
19,967(122,898)
66,619(77,653)
50,766

Total deferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

160,008(56,279)(26,887)

Total provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

551,686

767,808

893,469

Toyota is subject to a number of different income taxes which, in the aggregate, indicate a statutory rate inJapan of approximately 37.6%, 37.6% and 35.2% for the years ended March 31, 2013, 2014 and 2015,
respectively. The statutory tax rates in effect for the year in which the temporary differences are expected toF-33

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
reverse are used to calculate the tax effects of temporary differences which are expected to reverse in the futureyears. Reconciliation of the differences between the statutory tax rate and the effective income tax rate is asfollows:
For the years ended March 31,
2013
2014
2015

Statutory tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Increase (reduction) in taxes resulting from:
Non-deductible expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred tax liabilities on undistributed earnings of foreignsubsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred tax liabilities on undistributed earnings of affiliatedcompanies accounted for by the equity method . . . . . . . . . . . . . . .
Valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Tax credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
The difference between the statutory tax rate in Japan and that offoreign subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unrecognized tax benefits adjustments . . . . . . . . . . . . . . . . . . . . . . . .
Revision to reduce deferred tax assets and liabilities at the fiscal
year-end due to changes in tax rates . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effective income tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

37.6%

37.6%

35.2%

0.6

2.2

1.5

1.8

1.5

1.0

4.1
1.7
(3.1)

3.0
(4.3)
(6.5)

2.5
(0.5)
(5.3)

(4.8)
0.1

(3.2)
0.0

(2.4)
3.2

0.0
1.3
39.3%

0.9
0.3
31.5%

(1.9)
(2.4)
30.9%

“Unrecognized tax benefits adjustments” for the year ended March 31, 2015 reflects a charge for thesettlement of a pre 2012 tax position in a foreign jurisdiction.
Significant components of deferred tax assets and liabilities are as follows:
Yen in millions
March 31,
2014
2015

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, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Undistributed earnings of foreign subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Undistributed earnings of affiliated companies accounted for by the equity
method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Basis difference of acquired assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Lease transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gross deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net deferred tax liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F-34

179,159
523,473
126,721164,070
51,046
213,799
307,443
1,565,711(189,894)
1,375,817

184,215573,246
126,366
259,896
42,059220,226
288,012
1,694,020(169,811)
1,524,209(608,428)(37,556)(810,192)(27,692)(663,249) (686,692)(35,261)(31,946)(828,911) (1,162,540)(39,286)(21,597)(2,212,691) (2,740,659)(836,874) (1,216,450)

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The deferred tax assets and liabilities above that comprise the net deferred tax liability are included in the
consolidated balance sheets as follows:
Yen in millions
March 31,
2014
2015

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) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(24,951)(28,708)(1,811,846) (2,298,469)

Net deferred tax liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(836,874) (1,216,450)

866,386
133,537

978,179
132,548

The factors used to assess the likelihood of realization of the deferred tax assets are the future reversal ofexisting taxable temporary differences, the future taxable income and available tax planning strategies that are
prudent and feasible. All available evidence, both positive and negative, is considered to determine whether,based on the weight of that evidence, a valuation allowance is needed for deferred tax assets which are not morelikely-than-not to be realized.
The accounting for deferred tax assets represents Toyota’s current best estimate based on all available
evidence. Unanticipated events or changes could result in re-evaluating the realizability of deferred tax assets.
Operating loss carryforwards for tax purposes as of March 31, 2015 in Japan and foreign countries were¥22,162 million and ¥758,890 million, respectively, and are available as an offset against future taxable income.
The majority of these carryforwards in Japan and foreign countries expire in years 2016 to 2024 and expire inyears 2016 to 2034, respectively. Tax credit carryforwards as of March 31, 2015 in Japan and foreign countries
were ¥24,453 million and ¥17,606 million, respectively, and the majority of these carryforwards in Japan andforeign countries expire in years 2016 to 2018 and expire in years 2016 to 2035, respectively.
The valuation allowance mainly relates to deferred tax assets of operating loss and foreign tax credit
carryforwards for tax purposes that are not expected to be realized. The net changes in the total valuation
allowance for deferred tax assets for the years ended March 31, 2013, 2014 and 2015 consist of the following:
Yen in millions
For the years ended March 31,
2013
2014
2015

Valuation allowance at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deductions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

309,268 284,835 189,894
38,28523,39034,485(70,986) (128,928) (50,247)
8,268
10,597(4,321)

Valuation allowance at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

284,835

189,894

169,811“Other” includes the impact of consolidation and deconsolidation of certain entities due to changes inownership interest and currency translation adjustments during the years ended March 31, 2013, 2014 and 2015.

F-35

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Because management intends to reinvest undistributed earnings of foreign subsidiaries to the extent not
expected to be remitted in the foreseeable future, management has made no provision for income taxes on those
undistributed earnings aggregating ¥3,174,864 million as of March 31, 2015. Toyota estimates an additional tax
provision of ¥151,989 million would be required if the full amount of those undistributed earnings were remitted.
A summary of the gross unrecognized tax benefits changes for the years ended March 31, 2013, 2014 and2015 is as follows:
Yen in millions
For the years ended March 31,
2013
2014
2015

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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

16,901 22,447 19,393
2,401
310
593
4,339
491 94,852(1,619) (1,273) (4,015)——(58)(2,776) (3,771) (98,929)
3,201
1,189
1,808
22,447

19,393

13,644

The amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate was notmaterial at March 31, 2013, 2014 and 2015, respectively. Toyota does not believe it is reasonably possible thatthe total amounts of unrecognized tax benefits will significantly increase or decrease within the next twelve
months.
Interest and penalties related to income tax liabilities are included in “Other income (loss), net”. The
amounts of interest and penalties accrued as of and recognized for the years ended March 31, 2013, 2014 and2015, were not material.
Toyota remains subject to income tax examination for the tax returns related to the years beginning on andafter April 1, 2008 and January 1, 2000, with various tax jurisdictions in Japan and foreign countries,
respectively.
16. Shareholders’ equity:
Changes in the number of shares of common stock issued have resulted from the following:
2013

For the years ended March 31,
2014
2015

Common stock issued
Balance at beginning of year . . . . . . . . . . . . . . . . . . . . . . .
Issuance during the year . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchase and retirement . . . . . . . . . . . . . . . . . . . . . . . . . . .

3,447,997,492——

3,447,997,492——

3,447,997,492—(30,000,000)

Balance at end of year . . . . . . . . . . . . . . . . . . . . . . . .

3,447,997,492

3,447,997,492

3,417,997,492

The Companies Act provides that an amount equal to 10% of distributions from surplus paid by the parent
company and its Japanese subsidiaries be appropriated as a capital reserve or a retained earnings reserve. No
further appropriations are required when the total amount of the capital reserve and the retained earnings reserve
reaches 25% of stated capital.
F-36

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The retained earnings reserve included in retained earnings as of March 31, 2014 and 2015 were¥180,177 million and ¥186,555 million, respectively. The Companies Act provides that the retained earnings
reserve of the parent company and its Japanese subsidiaries is restricted and unable to be used for dividend
payments, and is excluded from the calculation of the profit available for dividend.
The amounts of statutory retained earnings of the parent company available for dividend payments toshareholders were ¥6,890,426 million and ¥7,635,250 million as of March 31, 2014 and 2015, respectively. In
accordance with customary practice in Japan, the distributions from surplus are not accrued in the financial
statements for the corresponding period, but are recorded in the subsequent accounting period after shareholders’approval has been obtained. Retained earnings at March 31, 2015 include amounts representing year-end cash
dividends of ¥393,352 million, ¥125 per share, which were approved at the Ordinary General Shareholders’Meeting, held on June 16, 2015.
Retained earnings at March 31, 2015 include ¥1,880,835 million relating to equity in undistributed earnings
of affiliated companies accounted for by the equity method.
At the Meeting of the Board of Directors held on March 26, 2014, Toyota Motor Corporation (“TMC”)
resolved to reissue 30,000 thousand shares of treasury stock at ¥1 per share by way of third-party allotment, torepurchase up to 60,000 thousand shares of TMC’s common stock at a total purchase price of up to¥360,000 million and to retire 30,000 thousand shares of treasury stock.
The reissuance of treasury stock was subject to the approval at Ordinary General Shareholders’ Meeting
held in June 2014, and the repurchase of TMC’s common stock and retirement of treasury stock were eachsubject to the approval of the reissuance of treasury stock at such Ordinary General Shareholders’ Meeting. The
delegation to TMC’s Board of Directors of the power to decide the terms of such reissuance was approved atsuch Ordinary General Shareholders’ Meeting held on June 17, 2014.
Presented below is additional information regarding the reissuance, repurchase and retirement of treasury
stock.
Reissuance of treasury stock
Reason for reissuing treasury stock TMC resolved at the Meeting of the Board of Directors held on March 26, 2014 to establish Toyota
Mobility Foundation, a General Incorporated Foundation (the “Foundation”). The reissuance of treasury stock
was made by way of third-party allotment to a trust that was established by TMC to provide funding for theactivities of the Foundation through dividends, etc. on TMC’s common stock.
Details of matters relating to reissuance Number of shares reissued . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Price of reissuance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amount of proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

30,000,000 shares¥1 per share¥30 million

Repurchase of treasury stock
Reason for repurchasing treasury stock The repurchase was made to avoid the dilution of TMC’s shares triggered by the reissuance of treasury
stock described above, and to effect capital efficiency and agile capital policy in view of the management
environment.
F-37

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Details of matters relating to repurchase Number of shares repurchased . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total purchase price for repurchase of shares . . . . . . . . . . . . . . . . . . . . . . .

55,521,900 shares¥359,994 million

Retirement of treasury stock
Reason for retiring treasury stock The retirement was made to relieve concerns regarding the dilution of TMC’s share value due to reissuanceof treasury stock in the future.
Details of matters relating to retirement Number of shares retired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

30,000,000 shares

The amount on retirement of treasury stock and the amount of the difference between fair value and bookvalue of treasury stock on reissuance for the Foundation were treated as a reduction in additional paid-in capitaland retained earnings and the amount of the difference between amount of proceeds and fair value of treasury
stock on reissuance was included in Other income (expense). The fair value of treasury stock was measured using
a dividend discount model due to the restrictions on transfer in the reissued stock for the Foundation. As a result,treasury stock, additional paid-in capital, retained earnings and Other income (expense) decreased by¥246,807million, ¥4,624million, ¥142,753million and ¥99,400million, respectively.

F-38

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
17. Accumulated other comprehensive income:Changes in accumulated other comprehensive income (loss) are as follows:
Yen in millions
Foreigncurrencytranslation
adjustments

Unrealized
gains (losses)
on securities

Pensionliability
adjustments

Accumulated
othercomprehensive
income (loss)

Balance at March 31, 2012 . . . . . . . . . . . . . . . . . . . . . . .
Other comprehensive income (loss) before
reclassifications, net of taxes of¥(12,664) million, ¥(176,417) million,¥(6,624) million and ¥(195,705) million . . . . . . .
Reclassifications, net of taxes of ¥— million,¥(17,497) million, ¥(4,335) million and¥(21,832) million . . . . . . . . . . . . . . . . . . . . . . . . .

(1,248,118)

298,306(229,021)(1,178,833)

461,754

348,0117,207

816,972—

26,198

7,504

33,702Other comprehensive income (loss), net of tax . . . . . . . .
Less - Other comprehensive income attributable tononcontrolling interests . . . . . . . . . . . . . . . . . . . . . . . .

461,754374,209

14,711

850,674(27,116)(5,702)

4,854(27,964)

Balance at March 31, 2013 . . . . . . . . . . . . . . . . . . . . . . .
Other comprehensive income (loss) before
reclassifications, net of taxes of¥(25,139) million, ¥(255,959) million,¥(44,987) million and ¥(326,085) million . . . . . .
Reclassifications, net of taxes of ¥— million,¥5,209 million, ¥(4,682) million and¥527 million . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(813,480)

666,813(209,456)(356,123)

301,889

507,566

91,507

900,962—(8,006)

7,897

(109)

Other comprehensive income (loss), net of tax . . . . . . . .
Less - Other comprehensive income attributable tononcontrolling interests . . . . . . . . . . . . . . . . . . . . . . . .

301,889

499,560

99,404

900,853(4,947)(5,810)(5,812)(16,569)

Balance at March 31, 2014 . . . . . . . . . . . . . . . . . . . . . . .

(516,538) 1,160,563(115,864)

528,161

Other comprehensive income (loss) before
reclassifications, net of taxes of ¥(8,742) million,¥(309,767) million, ¥2,853 million and¥(315,656) million . . . . . . . . . . . . . . . . . . . . . . . .
Reclassifications, net of taxes of ¥— million,¥11,013 million, ¥(2,153) million and¥8,860 million . . . . . . . . . . . . . . . . . . . . . . . . . . . .

404,352

596,417621

1,001,390—(18,714)

3,695(15,019)

Other comprehensive income (loss), net of tax . . . . . . . .
Less - Other comprehensive income attributable tononcontrolling interests . . . . . . . . . . . . . . . . . . . . . . . .

404,352

577,703

4,316

986,371(23,904)(10,701)(2,382)(36,987)

Balance at March 31, 2015 . . . . . . . . . . . . . . . . . . . . . . .

(136,090) 1,727,565(113,930)

1,477,545

F-39

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Reclassifications for the years ended March 31, 2014 and 2015 consist of the following:
Yen in millions
For the years ended
March 31,
2014
2015

Affected line itemsin the consolidated statements of income

Unrealized gains (losses) on securities:(29) (7,727) Financing operations
5,079 (14,552) Foreign exchange gain, net(18,469) (7,446) Other income (loss), net(13,419) (29,725) Income before income taxes and equity
in earnings of affiliated companies
5,209 11,013 Provision for income taxes
204(2) Equity in earnings of affiliatedcompanies(8,006) (18,714) Net income
Pension liability adjustments:
Recognized net actuarial loss . . . . . . . . . . . . .
Amortization of prior service costs . . . . . . . .

Total reclassifications, net of tax . . . . . . . . . . . . . .

17,786(5,207)

10,194 *1(4,346) *1

12,5795,848(4,682)

Income before income taxes and equity
in earnings of affiliated companies(2,153) Provision for income taxes

7,897

3,695

Net income(109) (15,019)

Amounts of reclassifications in parentheses indicate gains in the consolidated statements of income.
*1: These components are included in the computation of net periodic pension cost. See note 19 to theconsolidated financial statements for additional information.
18. Stock-based compensation:
In June 1997, the parent company’s shareholders approved a stock option plan for board members. In June
2001, the shareholders approved an amendment of the plan to include both board members and key employees.
Each year until June 2010, since the plans’ inception, the shareholders have approved the authorization for the
grant of options for the purchase of the parent company’s common stock. Authorized shares for each year thatremain ungranted are unavailable for grant in future years. Stock options granted in and after August 2006 haveterms of 8 years and an exercise price equal to 1.025 times the closing price of Toyota’s common stock on thedate of grant. These options generally vest 2 years from the date of grant.
For the years ended March 31, 2013 and 2014, Toyota recognized stock-based compensation expenses forstock options of ¥325 million and ¥23 million, respectively, as selling, general and administrative expenses.

F-40

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following table summarizes Toyota’s stock option activity:
Yen inmillions

Yen

Number ofshares

Weightedaverage
exercise price

Weightedaverageremaining
contractual
life in years

Aggregate
intrinsic
value

Options outstanding at March 31, 2012 . . . . . . . . . . . . . . .
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Canceled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

12,530,000—(645,000)(1,036,000)

4,910
—
3,328
5,907

4.55

1,065

Options outstanding at March 31, 2013 . . . . . . . . . . . . . . .
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Canceled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10,849,000—(2,390,100)(1,128,000)

4,909
—
4,043
6,373

3.56

5,921

Options outstanding at March 31, 2014 . . . . . . . . . . . . . . .

7,330,900

4,965

2.52

8,646

Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Canceled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

—(2,603,900)(1,223,500)

—
4,834
6,200

Options outstanding at March 31, 2015 . . . . . . . . . . . . . . .

3,503,500

4,632

2.05

13,143

Options exercisable at March 31, 2013 . . . . . . . . . . . . . . . . . .
Options exercisable at March 31, 2014 . . . . . . . . . . . . . . . . . .
Options exercisable at March 31, 2015 . . . . . . . . . . . . . . . . . .

10,849,000
7,330,900
3,503,500

4,909
4,965
4,632

3.56
2.52
2.05

5,921
8,646
13,143

The total intrinsic value of options exercised for the years ended March 31, 2013, 2014 and 2015 was¥364 million, ¥4,793 million and ¥5,313 million, respectively.
Cash received from the exercise of stock options for the years ended March 31, 2013, 2014 and 2015 was¥2,147 million ¥9,663 million and ¥12,501 million, respectively.
The following table summarizes information for options outstanding and options exercisable at March 31,
2015:

Exercise
price
range
Yen

Number ofsharesOutstanding
Weightedaverage
exercise
price
Yen

Exercisable

3,183 – 5,000
5,001 – 7,278

2,770,300
733,200

3,931
7,278

2.50
0.33

2,770,300
733,200

3,931
7,278

3,183 – 7,278

3,503,500

4,632

2.05

3,503,500

4,632

F-41

Weightedaverageremaining
life
Years

Number ofshares

Weightedaverage
exercise
price
YenTOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
19. Employee benefit plans:
Pension and severance plans Upon terminations of employment, employees of the parent company and subsidiaries in Japan are entitled,under the retirement plans of each company, to lump-sum indemnities or pension payments, based on current
rates of pay and lengths of service or the number of “points” mainly determined by those. Under normal
circumstances, the minimum payment prior to retirement age is an amount based on voluntary retirement.
Employees receive additional benefits on involuntary retirement, including retirement at the age limit.
Effective October 1, 2004, the parent company amended its retirement plan to introduce a “point” based
retirement benefit plan. Under the new plan, employees are entitled to lump-sum or pension payments
determined based on accumulated “points” vested in each year of service.
There are three types of “points” that vest in each year of service consisting of “service period points” which
are attributed to the length of service, “job title points” which are attributed to the job title of each employee, and“performance points” which are attributed to the annual performance evaluation of each employee. Under normal
circumstances, the minimum payment prior to retirement age is an amount reflecting an adjustment rate applied
to represent voluntary retirement. Employees receive additional benefits upon involuntary retirement, including
retirement at the age limit.
Effective October 1, 2005, the parent company partly amended its retirement plan and introduced the quasi
cash-balance plan under which benefits are determined based on the variable-interest crediting rate rather than
the fixed-interest crediting rate as was in the pre-amended plan.
The parent company and most subsidiaries in Japan have contributory funded defined benefit pension plans,
which are pursuant to the Corporate Defined Benefit Pension Plan Law (CDBPPL). The contributions to theplans are funded with several financial institutions in accordance with the applicable laws and regulations. These
pension plan assets consist principally of common stocks, government bonds and insurance contracts.
Most foreign subsidiaries have pension plans or severance indemnity plans covering substantially all of theiremployees under which the cost of benefits are currently invested or accrued. The benefits for these plans are
based primarily on lengths of service and current rates of pay.
Toyota uses a March 31 measurement date for its benefit plans.

F-42

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Information regarding Toyota’s defined benefit plans is as follows:
Yen in millions
March 31,
Japanese plans
Foreign plans
2014
2015
2014
2015

Change in benefit obligation
Benefit obligation at beginning of year . . . . . . . . . . . . . . . . . . .
Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Plan participants’ contributions . . . . . . . . . . . . . . . . . . . . . . . . .
Plan amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net actuarial (gain) loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Acquisition and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefit 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 . . . . . . . . . . . . . . . . . . . . . . . . .
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fair value of plan assets at end of year . . . . . . . . . . . . . . .
Funded status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,594,411 1,657,520 633,160 705,583
64,54973,25636,90841,147
24,51821,74632,15337,993
856
871
297
575
(427)
(381)
96
3,217
35,306
51,198 (30,012) 116,787—(18,523) 48,388
91,097(61,693)(64,462) (15,407) (19,469)
1,657,520 1,721,225 705,583 976,930
1,090,258 1,244,466 479,239 580,982
133,964
212,908
56,30059,800—(11,341) 42,694
74,171
56,38638,917
14,801
14,660
856
871
297
575
(36,998)(38,019) (12,349) (16,660)
1,244,466 1,447,802 580,982 713,528
413,054
273,423 124,601 263,402

Amounts recognized in the consolidated balance sheets as of March 31, 2014 and 2015 are comprised of thefollowing:
Yen in millions
March 31,
Japanese plans
Foreign plans
2014
2015
2014
2015

Accrued expenses (Accrued pension and severance costs) . . . . . . . .
Accrued pension and severance costs . . . . . . . . . . . . . . . . . . . . . . . .
Investments and other assets - Other (Prepaid pension andseverance costs) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net amount recognized . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-43

25,088573,301

26,906595,598

2,509
194,317

2,411
284,695(185,335)
413,054(349,081) (72,225) (23,704)
273,423 124,601 263,402

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Amounts recognized in accumulated other comprehensive income (loss) as of March 31, 2014 and 2015 arecomprised of the following:
Yen in millions
March 31,
Japanese plans
Foreign plans
2014
2015
2014
2015

Net actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (248,751) (110,948) (46,278) (133,594)
Prior service costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
48,22143,879(1,659)(4,499)Net transition obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
————Net amount recognized . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (200,530)(67,069) (47,937) (138,093)

The accumulated benefit obligation for all defined benefit pension plans was ¥1,593,424 million and¥1,647,345 million in Japanese plans, ¥617,042 million and ¥874,629 million in Foreign plans at March 31, 2014
and 2015, respectively.
The projected benefit obligation, accumulated benefit obligation and fair value of plan assets for which theaccumulated benefit obligations exceed plan assets are as follows:
Yen in millions
March 31,
Japanese plans
Foreign plans
2014
2015
2014
2015

Projected benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accumulated benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fair value of plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

792,445732,695
204,343

838,224805,107
217,738

175,238
153,254
19,136

341,416
324,160
65,533Components of the net periodic pension cost are as follows:
Yen in millions
For the years ended March 31,
Japanese plans
Foreign plans
2013
2014
2015
2013
2014

2015

Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,261 64,549 73,256 27,943 36,908 41,147
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,804 24,518 21,746 24,300 32,153 37,993
Expected return on plan assets . . . . . . . . . . . . . . . . . (22,352) (26,768) (31,255) (23,177) (34,059) (40,784)
Amortization of prior service costs . . . . . . . . . . . . . .
(8,033) (5,566) (4,723)
369
359
377
Recognized net actuarial loss . . . . . . . . . . . . . . . . . . 16,619 12,562
7,302
2,884
5,224
2,892
Amortization of net transition obligation . . . . . . . . .
—
—
—
—
—
—
Net periodic pension cost . . . . . . . . . . . . . . . . .

74,299F-44

69,29566,32632,31940,585

41,625TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Other changes in plan assets and benefit obligations recognized in other comprehensive income (loss) are as
follows:
Yen in millions
For the years ended March 31,
Japanese plans
Foreign plans
2013
2014
2015
2013
2014
2015

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) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

32,122 71,890 130,455 (15,804) 52,253 (97,772)
16,619 12,562
7,302
2,884
5,224
2,892
3,462
427
381
43
(96) (3,217)(8,033) (5,566) (4,723)
369
359
377
—
—
—
—
—
—
(173)
—
46
(8,162) (7,605)
7,564
43,99779,313

133,461(20,670) 50,135(90,156)“Other” includes the impact of consolidation and deconsolidation of certain entities due to changes inownership interest and currency translation adjustments during the years ended March 31, 2013, 2014 and 2015.
The estimated prior service costs and net actuarial loss that will be amortized from accumulated othercomprehensive income (loss) into net periodic pension cost during the year ending March 31, 2016 are¥(4,700) million and ¥5,700 million in Japanese plans, ¥400 million and ¥6,300 million in Foreign plans,
respectively.
Weighted-average assumptions used to determine benefit obligations as of March 31, 2014 and 2015 are as
follows:
March 31,
Japanese plans
Foreign plans
2014
2015
2014
2015

Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Rate of compensation increase . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1.4%
2.1%

1.1%
2.5%

4.8%
4.5%

4.0%
4.4%

As of March 31, 2014 and 2015, the parent company and certain subsidiaries in Japan employ “point” based
retirement benefit plans and do not use the rates of compensation increase to determine benefit obligations.
Weighted-average assumptions used to determine net periodic pension cost for the years ended March 31,
2013, 2014 and 2015 are as follows:

2013

Discount rate . . . . . . . . . . . . . . . . . . . . . .
Expected return on plan assets . . . . . . . . .
Rate of compensation increase . . . . . . . . .

For the years ended March 31,
Japanese plans
Foreign plans
2014
2015
2013
2014

2.0%
2.5%
2.3%

1.7%
2.6%
2.2%

1.4%
2.5%
2.1%

5.0%
7.0%
4.5%

4.5%
6.9%
4.6%

2015

4.8%
6.7%
4.5%

During the years ended March 31, 2013, 2014 and 2015, the parent company and certain subsidiaries inJapan employ “point” based retirement benefit plans and do not use the rates of compensation increase todetermine net periodic pension cost.
F-45

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The expected rate of return on plan assets is determined after considering several applicable factors
including, the composition of plan assets held, assumed risks of asset management, historical results of the
returns on plan assets, Toyota’s principal policy for plan asset management, and forecasted market conditions.
Toyota’s policy and objective for plan asset management is to maximize returns on plan assets to meet
future benefit payment requirements under risks which Toyota considers permissible. Asset allocations under theplan asset management are determined based on plan asset management policies of each plan which areestablished to achieve the optimized asset compositions in terms of the long-term overall plan asset management.
In Japanese plans, excepting equity securities contributed by Toyota, approximately 50% of the plan assets isinvested in equity securities, approximately 30% is invested in debt securities, and the rest of them is invested ininsurance contracts and other products. In Foreign plans, excepting equity securities contributed by Toyota,
approximately 60% of the plan assets is invested in equity securities, approximately 30% is invested in debt
securities, and the rest of them is invested in other products. When actual allocations are not in line with target
allocations, Toyota rebalances its investments in accordance with the policies. Prior to making individual
investments, Toyota performs in-depth assessments of corresponding factors including category of products,
industry type, currencies and liquidity of each potential investment under consideration to mitigate
concentrations of risks such as market risk and foreign currency exchange rate risk. To assess performance of theinvestments, Toyota establishes bench mark return rates for each individual investment, combines these
individual bench mark rates based on the asset composition ratios within each asset category, and compares the
combined rates with the corresponding actual return rates on each asset category.
The following table summarizes the fair value of classes of plan assets as of March 31, 2014 and 2015. Seenote 26 to the consolidated financial statements for three levels of input which are used to measure fair value.
Japanese plans

Level 1

Yen in millions
March 31, 2014
Level 2
Level 3

Total

511,828——
185,599——

511,828
185,599

511,828

185,599—

697,427

90,071———
229,42124,028——322

90,071
229,421
24,35090,071

253,449322

343,842

Insurance contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

—18,838132,8103,789—
47,760132,81070,387

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

620,737

575,647

48,082

1,244,466

Equity securities
Common stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commingled funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt securities
Government bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commingled funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-46

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Level 1

Yen in millions
March 31, 2015
Level 2
Level 3

Total

603,293——
163,543——

603,293
163,543

603,293

163,543—766,836

91,348———247,261
23,267——
233

91,348247,261
23,50091,348

270,528233

362,109

Insurance contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

—23,549175,068
70,133—50,107

175,068
143,789

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

718,190679,272

50,3401,447,802

Level 1

Yen in millions
March 31, 2014
Level 2
Level 3

Total

221,988——
125,840——

221,988
125,840

221,988

125,840—

347,828

54,086—3,004—
45,88744,964———54,08645,88747,96857,09090,851—

147,941

Insurance contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

—31,053—6,294—
47,866—
85,213

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

310,131

222,985

47,866580,982

Equity securities
Common stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commingled funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt securities
Government bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commingled funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Foreign plans

Equity securities
Common stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commingled funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt securities
Government bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commingled funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F-47

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Level 1

Yen in millions
March 31, 2015
Level 2
Level 3

244,542——
177,115——

244,542
177,115

244,542

177,115—421,657

67,534—
3,691—
71,71252,501———

67,53471,71256,192

71,225

124,213—

195,438

Insurance contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

—16,839—12,764—
66,830—96,433

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

332,606

314,092

66,830713,528

Equity securities
Common stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commingled funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt securities
Government bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commingled funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Total

The following is description of the assets, information about the valuation techniques used to measure fairvalue, key inputs and significant assumptions:
Quoted market prices for identical securities are used to measure fair value of common stocks. Common
stocks include 71% of Japanese stocks and 29% of foreign stocks as of March 31, 2014, and 77% of Japanesestocks and 23% of foreign stocks as of March 31, 2015 in Japanese plans. Common stocks include mainly
foreign stocks as of March 31, 2014 and 2015 in Foreign plans.
Quoted market prices for identical securities are used to measure fair value of government bonds.
Government bonds include 44% of Japanese government bonds and 56% of foreign government bonds as ofMarch 31, 2014, and 36% of Japanese government bonds and 64% of foreign government bonds as of March 31,
2015 in Japanese plans. Government bonds include mainly foreign government bonds as of March 31, 2014 and2015 in Foreign plans.
Commingled funds are beneficial interests of collective trust. The fair values of commingled funds aremeasured using the net asset value (“NAV”) provided by the administrator of the fund, and are categorized by theability to redeem investments at the measurement day.
The fair values of insurance contracts are measured using contracted amount with accrued interest.
“Other” consists of cash equivalents, other private placement investment funds and other assets. The fairvalues of other private placement investment funds are measured using the NAV provided by the administrator of
the fund, and are categorized by the ability to redeem investments at the measurement day.

F-48

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following tables summarize the changes in Level 3 plan assets measured at fair value for the years
ended March 31, 2013, 2014 and 2015:
Japanese plans

2013
Debt
securities Other

Yen in millions
For the years ended March 31,
2014
2015
Debt
Debt
Total securities Other Total securities Other

Total

Balance at beginning of year . . . . . . . . . . 591 40,065 40,656 441 41,535 41,976
Actual return on plan assets . . . . . . .
3
438
441
2 3,583 3,585
Purchases, sales and settlements . . . (153) 1,032
879 (121) 2,642 2,521
Other . . . . . . . . . . . . . . . . . . . . . . . . . —
—
—
—
—
—

322 47,760 48,082
2
1,169 1,171(91) 1,178 1,087———

Balance at end of year . . . . . . . . . . . . . . .

233

441 41,535 41,976

322 47,760 48,082

50,107 50,340

Foreign plans
Yen in millions
For the years ended March 31,
2013
2014
2015
Other
Other
Other

Balance at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31,377 40,607 47,866
Actual return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,472
791
4,699
Purchases, sales and settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,599
1,987
7,698
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4,159
4,481
6,567
Balance at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

40,60747,866

66,830Toyota expects to contribute ¥37,836 million in Japanese plans and ¥13,452 million in Foreign plans to its
pension plans in the year ending March 31, 2016.
The following pension benefit payments, which reflect expected future service, as appropriate, are expected
to be paid:
Yen in millions
Japanese plans Foreign plans

Years ending March 31,

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
from 2021 to 2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

69,60669,70970,611
77,29678,321
416,805
782,348

12,977
13,896
14,947
16,375
17,604
108,976
184,775

Postretirement benefits other than pensions and postemployment benefits Toyota’s U.S. subsidiaries provide certain health care and life insurance benefits to eligible retired
employees. In addition, Toyota provides benefits to certain former or inactive employees after employment, but
F-49

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
before retirement. These benefits are provided through various insurance companies, health care providers andothers. The costs of these benefits are recognized over the period the employee provides credited service toToyota. Toyota’s obligations under these arrangements are not material.
20. Derivative financial instruments:
Toyota employs derivative financial instruments, including foreign exchange forward contracts, foreign
currency options, interest rate swaps, interest rate currency swap agreements and interest rate options to manage
its exposure to fluctuations in interest rates and foreign currency exchange rates. Toyota does not use derivatives
for speculation or trading.
Fair value hedges Toyota enters into interest rate swaps and interest rate currency swap agreements mainly to convert its
fixed-rate debt to variable-rate debt. Toyota uses interest rate swap agreements in managing interest rate risk
exposure. Interest rate swap agreements are executed as either an integral part of specific debt transactions or ona portfolio basis. Toyota uses interest rate currency swap agreements to hedge exposure to currency exchange
rate fluctuations on principal and interest payments for borrowings denominated in foreign currencies. Notes andloans payable issued in foreign currencies are hedged by concurrently executing interest rate currency swap
agreements, which involve the exchange of foreign currency principal and interest obligations for each functional
currency obligations at agreed-upon currency exchange and interest rates.
For the years ended March 31, 2013, 2014 and 2015, the ineffective portion of Toyota’s fair value hedge
relationships was not material. For fair value hedging relationships, the components of each derivative’s gain orloss are included in the assessment of hedge effectiveness.
Undesignated derivative financial instruments Toyota uses foreign exchange forward contracts, foreign currency options, interest rate swaps, interest ratecurrency swap agreements, and interest rate options, to manage its exposure to foreign currency exchange rate
fluctuations and interest rate fluctuations from an economic perspective, and for which Toyota is unable to or has
elected not to apply hedge accounting.

F-50

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Fair value and gains or losses on derivative financial instruments The following table summarizes the fair values of derivative financial instruments as of March 31, 2014 and2015:
Yen in millions
March 31,
2014
2015

Derivative assets
Derivative financial instruments designated as hedging instruments
Interest rate and currency swap agreements
Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investments and other assets - Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,254
36,57237,826

527
2,880
3,407

Undesignated derivative financial instruments
Interest rate and currency swap agreements
Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investments and other assets - Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

23,182
159,644
182,826

57,915
242,404
300,319

Foreign exchange forward and option contracts
Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investments and other assets - Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7,052
—
7,052

35,594—35,594

Total derivative assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Counterparty netting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Collateral received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Carrying value of derivative assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

227,704 339,320(85,331) (117,794)(78,554) (76,891)
63,819 144,635

Derivative liabilities
Derivative financial instruments designated as hedging instruments
Interest rate and currency swap agreements
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(1,442)—(1,442)

Undesignated derivative financial instruments
Interest rate and currency swap agreements
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign exchange forward and option contracts
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total derivative liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Counterparty netting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Collateral posted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Carrying value of derivative liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F-51(4,793)(401)(5,194)(32,569) (94,801)(132,161) (253,428)(164,730) (348,229)(9,468)(5)(9,473)(7,307)(1)(7,308)(175,645) (360,731)
85,331 117,794
61,680 213,937(28,634) (29,000)

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following table summarizes the notional amounts of derivative financial instruments as of March 31,
2014 and 2015:
Yen in millions
March 31,2014
Designated Undesignatedderivative
derivative
financialfinancial
instruments
instruments

2015
Designated Undesignatedderivative
derivative
financialfinancial
instruments
instruments

Interest rate and currency swap agreements . . . . . . . . . . . . .
Foreign exchange forward and option contracts . . . . . . . . . .

151,704—

15,135,193
1,965,611

85,561—

18,634,479
2,625,106

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

151,704

17,100,804

85,561

21,259,585

The following table summarizes the gains and losses on derivative financial instruments and hedged items
reported in the consolidated statements of income for the years ended March 31, 2013, 2014 and 2015:
Yen in millions
For the years ended March 31,
2013
2014
2015
Gains or
Gains or
Gains or(losses) on(losses) on(losses) on
derivative
Gains orderivative
Gains orderivative
Gains orfinancial(losses) on
financial(losses) on
financial(losses) on
instruments hedged items instruments hedged items instruments hedged items

Derivative financial instruments
designated as hedging instruments
Interest rate and currency swap
agreements
Cost of financing operations . . .

(23,965)

24,738

Undesignated derivative financial
instruments
Interest rate and currency swap
agreements
Cost of financing operations . . . (24,204)
Foreign exchange gain (loss),
net . . . . . . . . . . . . . . . . . . . . .
1,617
Foreign exchange forward andoption contracts
Cost of financing operations . . .
(4,572)Foreign exchange gain (loss),
net . . . . . . . . . . . . . . . . . . . . . (49,239)(2,719)3,106(15,488)199(57,015)(2,862)

6,459

20,33331,738(930)(4,108)15,595

Undesignated derivative financial instruments are used to manage economic risks of fluctuations in foreign
currency exchange rates and interest rates of certain receivables and payables. Those economic risks are offset bychanges in the fair value of undesignated derivative financial instruments.
Cash flows from transactions of derivative financial instruments are included in cash flows from operating
activities in the consolidated statements of cash flows.
F-52

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Credit risk related contingent features Toyota enters into International Swaps and Derivatives Association Master Agreements with counterparties.
These Master Agreements contain a provision requiring either Toyota or the counterparty to settle the contract or
to post assets to the other party in the event of a ratings downgrade below a specified threshold.
The aggregate fair value amount of derivative financial instruments that contain credit risk related
contingent features that are in a net liability position after being offset by cash collateral as of March 31, 2015 is¥13,994 million. The aggregate fair value amount of assets that are already posted as cash collateral as ofMarch 31, 2015 is ¥203,568 million. If the ratings of Toyota decline below specified thresholds, the maximum
amount of assets to be posted or for which Toyota could be required to settle the contracts is ¥13,994 million asof March 31, 2015.
21. Other financial instruments:
Toyota has certain financial instruments, including financial assets and liabilities which arose in the normal
course of business. These financial instruments are executed with creditworthy financial institutions, andvirtually all foreign currency contracts are denominated in U.S. dollars, euros and other currencies of major
developed countries. Financial instruments involve, to varying degrees, market risk as instruments are subject toprice fluctuations, and elements of credit risk in the event a counterparty should default. In the unlikely event thecounterparties fail to meet the contractual terms of a foreign currency or an interest rate instrument, Toyota’s risk
is limited to the fair value of the instrument. Although Toyota may be exposed to losses in the event of nonperformance by counterparties on financial instruments, it does not anticipate significant losses due to the natureof its counterparties. Counterparties to Toyota’s financial instruments represent, in general, international
financial institutions. Additionally, Toyota does not have a significant exposure to any individual counterparty.
Toyota believes that the overall credit risk related to its financial instruments is not significant.
The following table summarizes the estimated fair values of Toyota’s financial instruments, excluding
marketable securities, other securities investments, investments and other assets in affiliated companies andderivative financial instruments. See note 26 to the consolidated financial statements for three levels of input
which are used to measure fair value.

Assets (Liabilities)
Cash and cash equivalents . . . . . . .
Time deposits . . . . . . . . . . . . . . . . .
Total finance receivables, net . . . . .
Other receivables . . . . . . . . . . . . . .
Short-term borrowings . . . . . . . . . .
Long-term debt including thecurrent portion . . . . . . . . . . . . . .

Carrying amount

Level 1

2,041,170
180,207
12,775,669
351,182(4,830,820)

1,639,624————(11,474,777)

—

F-53

Yen in millions
March 31, 2014
Estimated fair value
Level 2
Level 3

401,546—
180,207——
13,058,756—
351,182(4,830,820)
—

Total

2,041,170
180,207
13,058,756
351,182(4,830,820)(10,410,754) (1,204,668) (11,615,422)

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Assets (Liabilities)
Cash and cash equivalents . . . . . . .
Time deposits . . . . . . . . . . . . . . . . .
Total finance receivables, net . . . . .
Other receivables . . . . . . . . . . . . . .
Short-term borrowings . . . . . . . . . .
Long-term debt including thecurrent portion . . . . . . . . . . . . . .

Carrying amount

Level 1

2,284,557
149,321
14,437,459
420,708(5,048,188)

1,936,070————(13,910,240)—

Yen in millions
March 31, 2015
Estimated fair value
Level 2
Level 3

348,487—
149,321——
14,656,825—
420,708(5,044,376)(3,812)

Total

2,284,557
149,321
14,656,825
420,708(5,048,188)(12,589,871) (1,568,144) (14,158,015)

Cash and cash equivalents and time deposits In the normal course of business, substantially all cash and cash equivalents and time deposits are highly
liquid and are carried at amounts which approximate fair value due to its short duration. Cash equivalents andtime deposits include negotiable certificate of deposit measured at fair value on a recurring basis. Where money
market funds produce a daily net asset value in an active market, this value is used to determine the fair value ofthe fund investment, and the investment is classified in Level 1. All other types of cash and cash equivalents andtime deposits are classified in Level 2.
Finance receivables, net The fair values of finance receivables are estimated by discounting expected cash flows to present value
using internal assumptions, including prepayment speeds, expected credit losses and collateral value. Certain
impaired finance receivables are measured at fair value on a nonrecurring basis based on collateral values.
As unobservable inputs are utilized, finance receivables are classified in Level 3.
Other receivables Other receivables are short-term receivables. These receivables are carried at amounts which approximate
fair value, and the difference between the carrying amount and the fair value is not material. These receivables
are classified in Level 3.
Short-term borrowings and long-term debt The fair values of short-term borrowings and long-term debt including the current portion, except for
secured loans provided by securitization transactions using special-purpose entities, are estimated based on the
discounted amounts of future cash flows using Toyota’s current borrowing rates for similar liabilities. As these
inputs are observable, these debts are classified in Level 2.
The fair values of the secured loans provided by securitization transactions are estimated based on current
market rates and credit spreads for debt with similar maturities. Internal assumptions including prepayment
speeds and expected credit losses are used to estimate the timing of cash flows to be paid on the underlying
securitized assets. As these valuations utilize unobservable inputs, the secured loans are classified in Level 3. Seenote 12 to the consolidated financial statements for information regarding the secured loans.
F-54

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
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:
Yen in millions
March 31,
2014
2015

Class of property
Building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,828 15,872
Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,770 30,764
Less - Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (24,985) (27,647)
21,613 18,989
Amortization expenses under capital leases for the years ended March 31, 2013, 2014 and 2015 were
¥5,265 million, ¥5,151 million and ¥4,348 million, respectively.
Future minimum lease payments under capital leases together with the present value of the net minimum
lease payments as of March 31, 2015 are as follows:
Years ending March 31,

Yen in millions

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total minimum lease payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - Amount representing interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Present value of net minimum lease payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - Current obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term capital lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4,558
3,442
2,585
2,258
1,757
10,49825,098(5,639)19,459(3,743)
15,716

Rental expenses under operating leases for the years ended March 31, 2013, 2014 and 2015 were¥90,081 million, ¥94,613 million and ¥98,479 million, respectively.
The minimum rental payments required under operating leases relating primarily to land, buildings andequipment having initial or remaining non-cancelable lease terms in excess of one year at March 31, 2015 are as
follows:
Years ending March 31,

Yen in millions

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total minimum future rentals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F-55

14,765
12,343
10,5407,361
5,461
25,90476,374

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
23. Other commitments and contingencies, concentrations and factors that may affect future operations:
Commitments
Commitments outstanding as of March 31, 2015 for the purchase of property, plant and equipment, otherassets and services totaled ¥325,555 million.
Guarantees
Toyota enters into contracts with Toyota dealers to guarantee customers’ payments of their installment
payables that arise from installment contracts between customers and Toyota dealers, as and when requested by
Toyota dealers. Guarantee periods are set to match maturity of installment payments, and as of March 31, 2015,
range from 1 month to 35 years; however, they are generally shorter than the useful lives of products sold.
Toyota is required to execute its guarantee primarily when customers are unable to make required payments.
The maximum potential amount of future payments as of March 31, 2015 is ¥2,238,185 million. Liabilities
for guarantees totaling ¥6,531 million have been provided as of March 31, 2015. Under these guarantee
contracts, Toyota is entitled to recover any amount paid by Toyota from the customers whose original obligations
Toyota has guaranteed.
Legal proceedings
From time-to-time, Toyota issues vehicle recalls and takes other safety measures including safety campaigns
relating to its vehicles. In 2009 and 2010, Toyota issued safety campaigns related to the risk of floor mat
entrapment of accelerator pedals and vehicle recalls related to slow-to-return or sticky accelerator pedals.
Following some of these recalls and other safety measures, a large number of putative class actions andindividual lawsuits were brought against Toyota, alleging that certain Toyota, Lexus and Scion vehicles
contained defects that led to unintended acceleration. The class actions and individual lawsuits related toeconomic loss were resolved by a settlement which was approved by the United States District Court for theCentral District of California in July 2013, and the settlement of those claims is final.
There were also several government investigations related to unintended acceleration. The last of these to beresolved was the investigation initiated by the U.S. Attorney for the Southern District of New York in February
2010. In March 2014, Toyota announced that it entered into a deferred prosecution agreement (“DPA”) with the
U.S. Attorney’s Office to resolve its investigation. The DPA provided for a $1.2 billion payment to the
U.S. government, and Toyota recorded a $1.2 billion charge against earnings in fiscal 2014. Pursuant to the DPA,
an independent monitor was appointed to review and assess policies and procedures relating to Toyota’s safety
communications process, its process for sharing vehicle accident information internally and its process for
preparing and sharing certain technical reports.
In 2010, there was a recall related to the software program that controls the antilock braking system incertain models including the Prius, which led to putative class action lawsuits on behalf of owners of recalled
vehicles and owners of vehicles which were not recalled. These cases were consolidated into two actions, one in
the United States District Court for the Central District of California and one in the Los Angeles County Superior
Court. In January 2013, the United States District Court for the Central District of California denied theplaintiff’s motion for class certification and granted summary judgment in Toyota’s favor resolving the claims
related to the recalled vehicles, and in July 2013, the United States District Court for the Central District ofCalifornia denied the plaintiff’s motion for class certification and granted summary judgment in Toyota’s favorregarding the claims related to the non-recalled vehicles. Proceedings involving the recalled vehicles in bothcourts have concluded. The ruling of the United States District Court for the Central District of California related
to the non-recalled vehicles has been appealed.
F-56

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Product liability personal injury claims related to the floor mat entrapment of accelerator pedals and slowto-return or sticky accelerator pedal cases are pending in several consolidated cases in federal and state courts, aswell as in individual cases in various other states. The judges in the consolidated federal action and theconsolidated California state action have approved an Intensive Settlement Process (“ISP”) for such claims inthose actions. Under the ISP, all individual claims within the consolidated actions are stayed pending completionof a process to assess whether they can be resolved on terms acceptable to the parties. Cases not resolved after
completion of the ISP will then proceed to discovery and toward trial. Toyota has offered the ISP process toplaintiffs in other consolidated actions and in individual cases, as well.
Toyota has been named as a defendant in 27 economic loss class action lawsuits, which have been
consolidated for pretrial purposes in the United States District Court for the Southern District of Florida, arisingout of allegations that Takata airbags installed in Toyota vehicles are defective. These lawsuits are at a very earlystage.
Toyota also has various other legal actions, other governmental proceedings and other claims pending
against it, including other product liability claims in the United States.
Beyond the amounts accrued with respect to all aforementioned matters, Toyota is unable to estimate a
range of reasonably possible loss, if any, for the pending legal matters because (i) many of the proceedings are inevidence gathering stages, (ii) significant factual issues need to be resolved, (iii) the legal theory or nature of theclaims is unclear, (iv) the outcome of future motions or appeals is unknown and/or (v) the outcomes of othermatters of these types vary widely and do not appear sufficiently similar to offer meaningful guidance. Basedupon information currently available to Toyota, however, Toyota believes that its losses from these matters, ifany, beyond the amounts accrued, would not have a material adverse effect on Toyota’s financial position, resultsof operations or cash flows.
Toyota purchases materials that are equivalent to approximately 10% of material costs from a supplier
which is an affiliated company.
The parent company has a concentration of labor supply in employees working under collective bargaining
agreements and a substantial portion of these employees are working under the agreement that will expire on
December 31, 2017.
24. Segment data:
The operating segments reported below are the segments of Toyota for which separate financial information
is available and for which operating income/loss amounts are evaluated regularly by executive management indeciding how to allocate resources and in assessing performance.
The major portions of Toyota’s operations on a worldwide basis are derived from the Automotive andFinancial Services business segments. The Automotive segment designs, manufactures and distributes sedans,
minivans, compact cars, sport-utility vehicles, trucks and related parts and accessories. The Financial Services
segment consists primarily of financing, and vehicle and equipment leasing operations to assist in themerchandising of the parent company and its affiliated companies products as well as other products. The All
Other segment includes the design, manufacturing and sales of housing, telecommunications and otherbusinesses.

F-57

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following tables present certain information regarding Toyota’s industry or geographic segments andoverseas revenues by destination as of and for the years ended March 31, 2013, 2014 and 2015.
Segment operating results and assets As of and for the year ended March 31, 2013:
Yen in millions

Automotive

Financial
Services

All Other

Inter-segment
Elimination/
UnallocatedAmountNet revenues
Sales to external customers . . . . . . . . . .
Inter-segment sales and transfers . . . . . .

20,378,762
40,3381,150,042
20,628535,388531,073—(592,039)

22,064,192—

Total . . . . . . . . . . . . . . . . . . . . . . . .
Operating expenses . . . . . . . . . . . . . . . . . . . .

20,419,100
19,474,396

1,170,670
854,850

1,066,461
1,012,845(592,039)(598,787)

22,064,192
20,743,304

Operating income . . . . . . . . . . . . . . . . . . . . . .

944,704

315,820

53,616

6,748

1,320,888

Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment in equity method investees . . . . .
Depreciation expenses . . . . . . . . . . . . . . . . . .
Capital expenditure . . . . . . . . . . . . . . . . . . . .

13,179,741
2,033,040
745,880
937,695

16,231,473
4,925
336,528
1,005,326

1,310,115
6,968
22,701
29,286

4,761,988
57,651—
1,845

35,483,317
2,102,584
1,105,109
1,974,152

Consolidated

Consolidated

As of and for the year ended March 31, 2014:
Yen in millions

Automotive

Financial
Services

All Other

Inter-segment
Elimination/
UnallocatedAmountNet revenues
Sales to external customers . . . . . . . . . .
Inter-segment sales and transfers . . . . . .

23,733,855
47,5491,379,267
41,780578,789
572,491—(661,820)

25,691,911—

Total . . . . . . . . . . . . . . . . . . . . . . . .
Operating expenses . . . . . . . . . . . . . . . . . . . .

23,781,404
21,842,626

1,421,047
1,126,156

1,151,280
1,087,010(661,820)(655,993)

25,691,911
23,399,799

Operating income . . . . . . . . . . . . . . . . . . . . . .

1,938,778

294,891

64,270(5,827)

2,292,112

Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment in equity method investees . . . . .
Depreciation expenses . . . . . . . . . . . . . . . . . .
Capital expenditure . . . . . . . . . . . . . . . . . . . .

14,275,376
2,343,217
789,266
1,044,510

18,943,587
7,129
437,896
1,624,944

1,597,297
9,418
23,69139,9306,621,213
69,812—(30,693)

41,437,473
2,429,576
1,250,853
2,678,691

F-58

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
As of and for the year ended March 31, 2015:
Yen in millions

Automotive

Financial
Services

All Other

Inter-segment
Elimination/
UnallocatedAmountNet revenues
Sales to external customers . . . . . . . . . .
Inter-segment sales and transfers . . . . . .

25,006,224
55,905

1,621,685
39,464

606,612649,179—(744,548)

27,234,521—

Total . . . . . . . . . . . . . . . . . . . . . . . .
Operating expenses . . . . . . . . . . . . . . . . . . . .

25,062,129
22,736,819

1,661,149
1,299,316

1,255,791
1,190,141(744,548)(742,319)

27,234,521
24,483,957

Operating income . . . . . . . . . . . . . . . . . . . . . .

2,325,310

361,833

65,650(2,229)2,750,564

Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment in equity method investees . . . . .
Depreciation expenses . . . . . . . . . . . . . . . . . .
Capital expenditure . . . . . . . . . . . . . . . . . . . .

15,897,022
2,588,127
819,280
1,262,670

22,378,941
8,801
564,6192,086,481

1,889,433
10,00025,17639,5037,564,434
84,294—(31,086)

47,729,830
2,691,222
1,409,075
3,357,568

Consolidated

Geographic Information As of and for the year ended March 31, 2013:
Yen in millions

Japan

Net revenues
Sales to externalcustomers . . . . . . . .
Inter-segment sales
and transfers . . . . .

7,910,456
4,910,562

Total . . . . . . . . . 12,821,018
Operating expenses . . . . . . 12,244,683
Operating income . . . . . . .

576,335

North
America

Europe

Asia

Other

6,167,821 2,003,113 4,058,629 1,924,173
116,604

80,000326,847

Inter-segment
Elimination/
UnallocatedAmountConsolidated—

170,092 (5,604,105)

22,064,192—

6,284,425 2,083,113 4,385,476 2,094,265 (5,604,105) 22,064,192
6,062,500 2,056,651 4,009,421 1,960,521 (5,590,472) 20,743,304
221,925

26,462

133,744(13,633) 1,320,888

Assets . . . . . . . . . . . . . . . . 12,296,731 11,841,471 2,199,256 3,305,319 2,616,164
Long-lived assets . . . . . . . . 2,929,346 2,633,067 288,288 590,021 410,517

3,224,376 35,483,317—
6,851,239

F-59

376,055

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
As of and for the year ended March 31, 2014:
Yen in millions

Japan

Net revenues
Sales to externalcustomers . . . . . . . .
Inter-segment sales
and transfers . . . . .

8,532,875
5,764,595

Total . . . . . . . . . 14,297,470
Operating expenses . . . . . . 12,787,305
Operating income . . . . . . .

1,510,165

North
America

Europe

Asia

Other

Inter-segment
Elimination/
UnallocatedAmountConsolidated

7,938,615 2,614,070 4,475,382 2,130,969
178,484

110,889402,290—

205,672 (6,661,930)

25,691,911—

8,117,099 2,724,959 4,877,672 2,336,641 (6,661,930) 25,691,911
7,791,047 2,666,731 4,481,935 2,294,073 (6,621,292) 23,399,799
326,052

58,228395,737

42,568(40,638) 2,292,112

Assets . . . . . . . . . . . . . . . . 13,231,184 13,720,958 2,576,806 4,013,429 2,731,695
Long-lived assets . . . . . . . . 2,945,247 3,276,273 318,872 725,924 374,982

5,163,401 41,437,473—
7,641,298

As of and for the year ended March 31, 2015:
Yen in millions

Japan

Net revenues
Sales to externalcustomers . . . . . . . .
Inter-segment sales
and transfers . . . . .

8,338,881
6,064,986

Total . . . . . . . . . 14,403,867
Operating expenses . . . . . . 12,832,391
Operating income . . . . . . .

1,571,476

North
America

Europe

Asia

Other

Inter-segment
Elimination/
UnallocatedAmountConsolidated

9,430,450 2,690,803 4,531,178 2,243,209
247,146

157,491

450,062—

206,029 (7,125,714)

27,234,521—

9,677,596 2,848,294 4,981,240 2,449,238 (7,125,714) 27,234,521
9,093,077 2,767,176 4,559,458 2,337,729 (7,105,874) 24,483,957
584,519

81,118421,782

111,509(19,840) 2,750,564

Assets . . . . . . . . . . . . . . . . 14,466,432 16,961,700 2,640,054 4,753,850 2,903,474
Long-lived assets . . . . . . . . 3,062,463 4,632,536 301,736 874,207 424,777

6,004,320 47,729,830—
9,295,719“Other” consists of Central and South America, Oceania, Africa and the Middle East.
Revenues are attributed to geographies based on the country location of the parent company or thesubsidiary that transacted the sale with the external customer.
There are no any individually material countries with respect to revenues, and long-lived assets included inother foreign countries.
Unallocated amounts included in assets represent assets held for corporate purposes, which mainly consistof cash and cash equivalents and marketable securities. Such corporate assets were ¥5,599,970 million,¥7,659,617 million and ¥8,742,168 million, as of March 31, 2013, 2014 and 2015, respectively.
F-60

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Transfers between industry or geographic segments are made at amounts which Toyota’s management
believes approximate arm’s-length transactions. In measuring the reportable segments’ income or losses,
operating income consists of revenue less operating expenses.
Overseas revenues by destination The following information shows revenues that are attributed to countries based on location of customers,
excluding customers in Japan. In addition to the disclosure requirements under U.S.GAAP, Toyota discloses thisinformation in order to provide financial statements users with valuable information.
Yen in millions
For the years ended March 31,
2013
2014
2015

North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6,790,453
1,901,118
3,940,175
3,929,775

7,919,832
2,495,829
4,252,632
4,616,944“Other” consists of Central and South America, Oceania, Africa and the Middle East, etc.

F-61

9,405,305
2,555,368
4,231,077
4,947,169

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Certain financial statements data on non-financial services and financial services businesses The financial data below presents separately Toyota’s non-financial services and financial services
businesses.
Balance sheets Yen in millions
March 31,
2014
2015

Assets
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 . . . . . . . . . . . . . . . . . . . . . . .

1,411,860
1,770,142

1,680,994
2,251,581

2,102,495
1,894,536
1,689,497

2,178,984
2,137,021
1,898,558

Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8,868,530

10,147,138

Investments and other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9,524,349
4,886,194

10,765,747
5,346,553

Total Non-Financial Services Businesses assets . . . . . . . . . . . . . . .

23,279,073

26,259,438

Financial Services BusinessCurrent assets
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Marketable securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Finance receivables, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . . . .

629,310
276,735
5,628,934
903,022603,563530,518
6,269,862
1,007,249

Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7,438,001

8,411,192

Noncurrent finance receivables, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investments and other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8,102,294
648,188
2,755,104

9,202,531
816,052
3,949,166

Total Financial Services Business assets . . . . . . . . . . . . . . . . . . . .

18,943,587

22,378,941

Eliminations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(785,187)(908,549)

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

41,437,473

47,729,830

Assets in the non-financial services include unallocated corporate assets.

F-62

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Yen in millions
March 31,
2014
2015

Liabilities
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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

587,809131,215
2,180,190
2,218,495
583,115
1,283,730

567,566
116,496
2,372,354
2,567,998
338,680
1,437,114

Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6,984,554

7,400,208

Long-term liabilities
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued pension and severance costs . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

526,498
756,229
1,506,806

564,746866,930
1,872,881

Total long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,789,533

3,304,557

Total Non-Financial Services Businesses liabilities . . . . . . . . . . . .

9,774,087

10,704,765

Financial Services BusinessCurrent liabilities
Short-term borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current portion of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4,610,449
2,834,445
45,687
108,953
11,714685,278

4,849,826
3,830,413
45,195
116,868
10,106
802,666

Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8,296,526

9,655,074

Long-term liabilities
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued pension and severance costs . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8,084,565
11,389840,218

9,526,991
13,363
1,091,616

Total long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8,936,172

10,631,970

Total Financial Services Business liabilities . . . . . . . . . . . . . . . . . .

17,232,698

20,287,044

Eliminations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(788,299)(909,308)

Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

26,218,486

30,082,501

Total Toyota Motor Corporation shareholders’ equity . . . . . . . . . . . . . . . . . .

14,469,148

16,788,131

Noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

749,839

859,198

Total shareholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

15,218,987

17,647,329

Total liabilities and shareholders’ equity . . . . . . . . . . . . . . . . . . . .

41,437,473

47,729,830

F-63

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Statements of income Yen in millions
For the years ended March 31,
2013
2014
2015

Non-Financial Services Businesses
Net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

20,943,634

24,343,613

25,643,508

Costs and expenses
Cost of revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Selling, general and administrative . . . . . . . . . . . . . . . . . . . . . .

18,034,256
1,899,997

20,004,553
2,334,404

20,933,168
2,319,262

Total costs and expenses . . . . . . . . . . . . . . . . . . . . . . . . . .

19,934,253

22,338,957

23,252,430

Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,009,381

2,004,656

2,391,078

Other income (expense), net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

79,837140,067

136,797

Income before income taxes and equity in earnings of affiliatedcompanies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,089,218

2,144,723

2,527,875

Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity in earnings of affiliated companies . . . . . . . . . . . . . . . . . . . .

436,223230,078

669,173
316,612763,445306,749

Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

883,073

1,792,162

2,071,179

Less - Net income attributable to noncontrolling interests . . . . . . . .

(119,359)(164,709)(130,172)

Net income attributable to Toyota Motor Corporation- Non-Financial Services Businesses . . . . . . . . . . . . . . . . . . . . . .

763,714

1,627,453

1,941,007Financial Services BusinessNet revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,170,670

1,421,047

1,661,149

Costs and expenses
Cost of revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Selling, general and administrative . . . . . . . . . . . . . . . . . . . . . .

633,306
221,544840,905
285,251

955,380
343,936

Total costs and expenses . . . . . . . . . . . . . . . . . . . . . . . . . .

854,850

1,126,156

1,299,316

Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

315,820294,891

361,833

Other income (expense), net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(970)

1,451

3,190

Income before income taxes and equity in earnings of affiliatedcompanies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

314,850

296,342

365,023

Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity in earnings of affiliated companies . . . . . . . . . . . . . . . . . . . .

116,033
1,441

98,5891,764

130,049
1,796

Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

200,258

199,517

236,770

Less - Net income attributable to noncontrolling interests . . . . . . . .

(1,961)(3,819)(4,417)

Net income attributable to Toyota Motor Corporation- Financial Services Business . . . . . . . . . . . . . . . . . . . . . . . . . . . .

198,297

195,698

232,353

Eliminations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

152

(32)

(22)

Net income attributable to Toyota Motor Corporation . . . . . . . . . . .

962,163

1,823,119

2,173,338

F-64

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Statements of cash flows Yen in millions
Yen in millions
For the year ended March 31, 2013
For the year ended March 31, 2014
Non-Financial Financial
Non-Financial Financial
Services
Services
Services
Services
Businesses
Business Consolidated Businesses
Business Consolidated
Cash flows 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, lesspayments . . . . . . . . . . . . . . . . . . . . . . . . . . .
Losses on disposal of fixed assets . . . . . . . . .
Unrealized losses on available-for-salesecurities, net . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . .
Equity in earnings of affiliated companies . . .
Changes in operating assets and liabilities,
and other . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash provided by operating
activities . . . . . . . . . . . . . . . . . . . . . . .
Cash flows from investing activities
Additions to finance receivables . . . . . . . . . . . . . . .
Collection of and proceeds from sales of financereceivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Additions to fixed assets excluding equipment
leased to others . . . . . . . . . . . . . . . . . . . . . . . . . .
Additions to equipment leased to others . . . . . . . . .
Proceeds from sales of fixed assets excluding
equipment leased to others . . . . . . . . . . . . . . . . .
Proceeds from sales of equipment leased toothers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchases of marketable securities and security
investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from sales of and maturity of marketablesecurities and security investments . . . . . . . . . . .
Payment for additional investments in affiliatedcompanies, net of cash acquired . . . . . . . . . . . . .
Changes in investments and other assets, andother . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash used in investing activities . . . .
Cash flows from financing activities
Proceeds from issuance of long-term debt . . . . . . .
Payments of long-term debt . . . . . . . . . . . . . . . . . .
Increase (decrease) in short-term borrowings . . . . .
Dividends paid to Toyota Motor Corporation
shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends paid to noncontrolling interests . . . . . . .
Reissuance (repurchase) of treasury stock . . . . . . .

883,073

200,258

1,083,482

1,792,162

199,517

1,991,648

768,581336,528

1,105,109

812,957

437,896

1,250,853

1,745

25,62227,367

3,405

46,31349,718(23,514)32,005

3,085
216(20,429)
32,221

21,842
27,925(1,188)732

20,65428,6572,104
89,834(230,078)—
70,743(1,441)

2,104
160,008(231,519)

560(108,318)(316,612)

5,636
51,995(1,764)

6,197(56,279)(318,376)

472,51432,066292,973

1,010,360(269,875)

672,963

1,996,264

667,077

2,451,316

3,244,281

469,2623,646,035—(16,877,678) (10,004,928)—(20,598,521) (11,953,064)—

15,784,681—

19,612,456 11,025,353(956,232)(97,515)(13,789)(970,021)(1,611,155) (1,708,670)(839,756)(129,070)

9,102,856(14,805)(854,561)(990,521) (1,119,591)

38,051

1,140

39,191

38,311880

39,191

68,571

464,870

533,441

35,995

708,344744,339(2,980,821)(431,602) (3,412,423)(4,227,802)(510,476) (4,738,278)

2,285,566

383,525

2,669,091

2,813,373

505,954

3,319,327

16,216—

16,216

6,603

—

6,603

(77,848)(4,607)(101,028)

3,396(125,353)(1,524,037)

17,206(1,758,238) (3,027,312)(2,512,620)(1,910,914) (4,336,248)

182,114(328,380)(162,782)

3,089,484 3,191,223(2,415,566) (2,682,136)
388,416
201,261

121,723(169,233)
21,8083,780,228 3,890,310(2,831,116) (2,988,923)
465,731467,976(190,008)(45,640)
2,542

—
—
—

(190,008)(45,640)2,542(396,030)(63,065)
9,212

—
—
—

(396,030)(63,065)
9,212

Net cash provided by (used in) financing
activities . . . . . . . . . . . . . . . . . . . . . . .

(542,154)

1,062,334

477,242(475,585)

1,414,843

919,480

Effect of exchange rate changes on cash and cash
equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

72,70065,151

137,851

48,37545,231

93,606

Net increase in cash and cash equivalents . . . . . . . . . . .
Cash and cash equivalents at beginning of year . . . . . . .

2,773
1,104,636

36,324
574,564

39,097
1,679,200

304,451
1,107,409

18,422610,888322,873
1,718,297

Cash and cash equivalents at end of year . . . . . . . . . . . .

1,107,409

610,888

1,718,297

1,411,860

629,310

2,041,170

F-65

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Yen in millions
For the year ended March 31, 2015
Non-Financial
Financial
Services
Services
Businesses
Business
Consolidated
Cash flows 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 fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unrealized losses on available-for-sale securities, net . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity in earnings of affiliated companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changes in operating assets and liabilities, and other . . . . . . . . . . . . . . . . . . . . . . .

2,071,179

236,770

2,307,904

844,456(1,598)(5,263)31,601
2,565(114,122)(306,749)
356,269

564,619
80,5672,102
24
1387,260(1,796)(191,791)

1,409,075
78,969(3,161)
31,625
2,578(26,887)(308,545)
194,195

2,878,338

777,7683,685,753——(1,133,102)(137,985)
40,03240,878(2,530,591)(22,325,159)
21,668,847(13,216)(2,073,265)
1,515
762,545(663,703)(13,126,596)
12,450,388(1,146,318)(2,211,250)
41,547803,423(3,194,294)

2,198,799—(114,094)

484,202—(9,669)2,683,001—(113,391)

Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(1,636,063)(2,167,903)(3,813,490)

Cash flows from financing activities
Proceeds from issuance of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Payments of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Increase (decrease) in short-term borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends paid to Toyota Motor Corporation shareholders . . . . . . . . . . . . . . . . . . . . . .
Dividends paid to noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Reissuance (repurchase) of treasury stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

119,449(100,627)(47,026)(554,933)(69,295)(347,784)

4,960,157(3,373,842)(259,931)———

5,029,018(3,462,237)(288,724)(554,933)(69,295)(347,784)

Net cash provided by (used in) financing activities . . . . . . . . . . . . . . . . . . . . .

(1,000,216)

1,326,384

306,045

Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash flows from investing activities
Additions to finance receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Collection of and proceeds from sales of finance receivables . . . . . . . . . . . . . . . . . . . . .
Additions to fixed assets excluding equipment leased to others . . . . . . . . . . . . . . . . . . .
Additions to equipment leased to others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from sales of fixed 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 affiliated companies, net of cash acquired . . . . .
Changes in investments and other assets, and other . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Effect of exchange rate changes on cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . .

27,07538,00465,079Net increase (decrease) in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash and cash equivalents at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

269,134
1,411,860(25,747)
629,310

243,387
2,041,170

Cash and cash equivalents at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,680,994

603,5632,284,557

F-66

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
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, 2013, 2014 and 2015 are as follows:

For the year ended March 31, 2013
Basic net income attributable to Toyota Motor Corporation percommon share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of dilutive securities
Assumed exercise of dilutive stock options . . . . . . . . . . . . . .
Diluted net income attributable to Toyota Motor Corporation percommon share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
For the year ended March 31, 2014
Basic net income attributable to Toyota Motor Corporation percommon share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of dilutive securities
Assumed exercise of dilutive stock options . . . . . . . . . . . . . .
Diluted net income attributable to Toyota Motor Corporation percommon share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
For the year ended March 31, 2015
Basic net income attributable to Toyota Motor Corporation percommon share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of dilutive securities
Assumed exercise of dilutive stock options . . . . . . . . . . . . . .
Diluted net income attributable to Toyota Motor Corporation percommon share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Yen inmillions

Thousandsof shares

Net income
attributable to
Toyota Motor
Corporation

Weightedaverage
sharesYen
Net income
attributable to
Toyota Motor
Corporation
per share

962,163

3,166,909

303.82(32)

246

962,131

3,167,155

303.78

1,823,119

3,168,989

575.30

(85)

1,922

1,823,034

3,170,911

574.92

2,173,338

3,158,851

688.02

(42)

1,578

2,173,296

3,160,429

687.66

Stock options that were not included in the computation of diluted net income attributable to Toyota Motor
Corporation per share for the years ended March 31, 2013, 2014 and 2015 were 8,682 thousand shares,
2,415 thousand shares and 733 thousand shares, respectively, because the options’ exercise prices were greaterthan the average market price per common share during the period.
In addition to the disclosure requirements under U.S.GAAP, Toyota discloses the information below inorder to provide financial statements users with valuable information.

F-67

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following table shows Toyota Motor Corporation shareholders’ equity per share as of March 31, 2014
and 2015. 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 andoutstanding, excluding treasury stock at the end of the corresponding period.
Yen inmillions

As of March 31, 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
As of March 31, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Toyota Motor
Corporation
Shareholders’equityThousandsof shares
Shares issued
andoutstandingat the end of
the year(excluding
treasurystock)

Toyota Motor
Corporation
Shareholders’equityper share

14,469,148
16,788,131

3,169,766
3,146,814

4,564.74
5,334.96

Yen

26. Fair value measurements:
In accordance with U.S.GAAP, Toyota classifies fair value into three levels of input as follows which areused to measure it.
Level 1:

Quoted prices in active markets for identical assets or liabilities

Level 2:

Quoted prices for similar assets or liabilities in active markets; quoted prices for identical orsimilar assets or liabilities in markets that are not active; inputs other than quoted prices that are
observable for the valuation of assets or liabilities

Level 3:

Valuation of assets or liabilities using unobservable inputs which reflect the reporting entity’s
assumptions

The following table summarizes the fair values of the assets and liabilities measured at fair value on arecurring basis as of March 31, 2014 and 2015. Transfers between levels of the fair value are recognized at theend of their respective reporting periods:

Level 1

Yen in millions
March 31, 2014
Level 2
Level 3

Total

AssetsCash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Marketable securities and other securities investments
Public and corporate bonds . . . . . . . . . . . . . . . . . . . . . .
Common stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Derivative financial instruments . . . . . . . . . . . . . . . . . . . . . .

311,582

401,546—

713,128

5,234,856
1,997,196
54,383—920,975—
517,950
220,160

9,092
—
—
7,544

6,164,923
1,997,196
572,333
227,704

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7,598,017

2,060,631

16,636

9,675,284

Liabilities
Derivative financial instruments . . . . . . . . . . . . . . . . . . . . . .

—(175,645)—(175,645)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

—(175,645)—(175,645)

F-68

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Level 1

Yen in millions
March 31, 2015
Level 2
Level 3

Total

AssetsCash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Marketable securities and other securities investments
Public and corporate bonds . . . . . . . . . . . . . . . . . . . . . .
Common stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Derivative financial instruments . . . . . . . . . . . . . . . . . . . . . .

145,923

348,487—

494,4106,129,824
2,704,814
61,538—1,038,810—
369,184
338,310

12,317——1,010

7,180,951
2,704,814
430,722339,320

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9,042,099

2,094,791

13,327

11,150,217

Liabilities
Derivative financial instruments . . . . . . . . . . . . . . . . . . . . . .

—(360,731)—(360,731)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

—(360,731)—(360,731)

The following is description of the assets and liabilities measured at fair value, information about thevaluation techniques used to measure fair value, key inputs and significant assumptions:
Cash equivalents Cash equivalents include money market funds and other investments with original maturities of threemonths or less. Cash equivalents classified in Level 2 include negotiable certificate of deposit with original
maturities of three months or less. These are measured at fair value using primarily observable interest rates in
the market.
Marketable securities and other securities investments Marketable securities and other securities investments include public and corporate bonds, common stocks
and other investments. Public and corporate bonds include government bonds and represent 50% of Japanesebonds, and 50% of U.S., European and other bonds as of March 31, 2014, and 43% of Japanese bonds, and 57%
of U.S., European and other bonds as of March 31, 2015. Listed stocks on the Japanese stock markets represent
86% and 88% of common stocks as of March 31, 2014 and 2015, respectively. Toyota uses primarily quoted
market prices for identical assets to measure fair value of these securities. “Other” includes investment trusts.
Generally, Toyota uses quoted market prices for similar assets or quoted non-active market prices for identicalassets to measure fair value of these securities. These assets are classified in Level 2.
Derivative financial instruments See note 20 to the consolidated financial statements about derivative financial instruments. Toyota primarily
estimates the fair value of derivative financial instruments using industry-standard valuation models that require
observable inputs including interest rates and foreign exchange rates, and the contractual terms. The usage ofthese models does not require significant judgment to be applied. These derivative financial instruments areclassified in Level 2. In other certain cases when market data is not available, key inputs to the fair value
measurement include quotes from counterparties, and other market data. Toyota assesses the reasonableness ofchanges of the quotes using observable market data. These derivative financial instruments are classified in Level
3. Toyota’s derivative fair value measurements consider assumptions about counterparty and Toyota’s own nonperformance risk, using such as credit default probabilities.
F-69

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following table summarizes the changes in Level 3 assets and liabilities measured at fair value on arecurring basis for the periods ended March 31, 2013, 2014 and 2015:
Yen in millions
For the year ended March 31, 2013Marketablesecurities andDerivative
other securities
financialinvestments
instruments
Total

Balance at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total gains (losses)
Included in income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Included in other comprehensive income (loss) . . . . . . . . . . . . . . .
Purchases and issuances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,684

4,739

6,423

24
58
3,607
(1,563)
3,079

2,118
—
—
(2,343)
613

2,142
58
3,607
(3,906)
3,692

Balance at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6,889

5,127

12,016

Yen in millions
For the year ended March 31, 2014
Marketablesecurities andDerivative
other securities
financialinvestments
instruments
Total

Balance at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total gains (losses)
Included in income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Included in other comprehensive income (loss) . . . . . . . . . . . . . . .
Purchases and issuances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6,889

5,127

12,016

(28)
(228)
2,575
(1,555)
1,439

3,460
—
—
(1,579)
536

3,432
(228)
2,575
(3,134)
1,975

Balance at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9,092

7,544

16,636

Yen in millions
For the year ended March 31, 2015
Marketablesecurities andDerivative
other securities
financialinvestments
instruments
Total

Balance at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total gains (losses)
Included in income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Included in other comprehensive income (loss) . . . . . . . . . . . . . . .
Purchases and issuances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9,092

7,544

16,636

(33)
227
4,055
(2,914)
1,890(5,953)——(1,169)588(5,986)227
4,055(4,083)
2,478

Balance at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

12,3171,010

13,327

F-70

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)“Included in income (loss)” in marketable securities and other securities investments and derivative
financial instruments are included in “Other income (loss), net” and “Cost of financing operations” in theaccompanying consolidated statements of income, respectively.
In the reconciliation table above, derivative financial instruments are presented net of assets and liabilities.
“Other” includes the currency translation adjustments for the years ended March 31, 2013, 2014 and 2015.
As of March 31, 2015, the Level 3 assets and liabilities measured at fair value on a recurring basis are notsignificant.
Certain assets and liabilities are measured at fair value on a nonrecurring basis. During the years ended
March 31, 2014 and 2015, Toyota measured certain finance receivables at fair value of ¥22,432 million and¥40,901 million based on the collateral value, resulting in gain of ¥220 million and loss of ¥2,790 million,
respectively. This fair value measurement on a nonrecurring basis is classified in Level 3. See note 21 to theconsolidated financial statements for the fair value measurement. These Level 3 financial assets are notsignificant.
27. Restructuring charges and asset impairments:
In February 2014, TMC and Toyota Motor Corporation Australia Ltd., its production and sales subsidiary inAustralia, decided to end their vehicle and engine production in Australia by the end of 2017. In fiscal 2014,
Toyota recorded costs and expenses of ¥83,073 million relating to the end of production in Australia in theautomotive segment. These costs and expenses consist primarily of long-lived assets impairment charges of¥47,190 million and other restructuring charges of ¥35,883 million. In fiscal 2015, Toyota recorded additionalcharges which were not material. Toyota expects to incur additional charges each year from fiscal 2016 throughthe year 2017 which are not material to Toyota.
28. Significant subsequent events:
Issuance of Class Shares At the Meeting of the Board of Directors on April 28, 2015, TMC resolved to submit to shareholders, at
TMC’s Ordinary General Meeting of Shareholders held on June 16, 2015 (the “Ordinary General Meeting of
Shareholders”), agenda to partially amend its articles of incorporation pertaining to the establishment of the First
Series Model AA Class Shares (the “First Series Model AA Class Shares”) through the Fifth Series of Model AA
Class Shares (individually and collectively, “Model AA Class Shares”), and to delegate to the Board of Directors
the power to decide matters pertaining to the offering of the First Series Model AA Class Shares. At the Meetingof the Board of Directors, TMC also resolved to issue the First Series Model AA Class Shares through a public
offering, subject to the above agenda being approved at the Ordinary General Meeting of Shareholders. Since theabove agenda was approved at the Ordinary General Meeting of Shareholders, the Board of Directors resolved
the offering terms of the First Series Model AA Class Shares pursuant to the above delegation.
To avoid the dilution of its common shares (“Common Shares”) as a result of the issuance of the First Series
Model AA Class Shares, TMC at the Meeting of the Board of Directors resolved to repurchase the Common
Shares.

F-71

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Presented below is additional information regarding the issuance of First Series Model AA Class Shares andrepurchase of common share in response to issuance of the First Series Model AA Class Shares.
(1) Issuance of the First Series Model AA Class Shares
Reason for issuing Model AA Class Shares Fundings for research and development for next-generation innovation, including the development of fuelbattery vehicles, research on infrastructure and development of computerized and sophisticated intelligencemobility technology.
Details of Model AA Class Shares Name of shares to be offered forsubscription . . . . . . . . . . . . . . . . . . . . . .

Model AA Class Shares

Total number of authorized shares . . . . . .

150,000,000 shares (aggregate number of First Series ModelAA Class Shares through Fifth Series Model AA Class
Shares, maximum)

Voting rights . . . . . . . . . . . . . . . . . . . . . . .

Model AA Class Shares shall have voting rights. The
number of shares constituting one unit (tangen) of shares of
TMC shall be 100.

Transfer restrictions . . . . . . . . . . . . . . . . .

Model AA Class Shares shall have transfer restrictions.

F-72

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Details of offering terms for the First Series Model AA Class Shares Expected issuance date (Payment date) . .

July 24, 2015

Method of offering . . . . . . . . . . . . . . . . . .

Public offering in Japan

Number of shares to be issued . . . . . . . . .

TMC has already resolved that the number of shares to beissued is up to a maximum of 50 million shares and aminimum of 30 million shares. The specific number ofshares to be issued has not yet been determined and will be
determined on any date from July 2, 2015 to July 7, 2015
(the “Issue Price Determination Date”).

Issue Price . . . . . . . . . . . . . . . . . . . . . . . . .

For determination of the Issue Price, an approach similar tothe book-building approach specified in Article 25 of theRules Regarding Underwriting of Securities prescribed by
the Japan Securities Dealers Association will apply, and theIssue Price will then be determined in comprehensive
consideration of demand based on the provisional range (*),
the price level of the Common Shares to which the value ofthe First Series Model AA Class Shares are expected to besignificantly linked, the risk of price volatility, etc.
* The provisional range for the Issue Price shall becalculated by multiplying the closing price of regular tradingof Common Shares on the Tokyo Stock Exchange on theIssue Price Determination Date (the closing price on theprevious day, in the event there is no closing price on theIssue Price Determination Date) by any number through1.26 to 1.30. Any fractions of less than one yen shall be
disregarded.

Dividends . . . . . . . . . . . . . . . . . . . . . . . . .

Dividends per First Series Model AA Class Share shall be
0.5% of the Issue Price regarding the fiscal year of TMC in
which the issuance date of the First Series Model AA Class
Shares falls. From and after the second fiscal year, thedividends shall incrementally increase by 0.5% annually
until the fifth fiscal year. From and after the fifth fiscal year,
the dividends shall be 2.5% of the Issue Price.

Shareholder’s right . . . . . . . . . . . . . . . . . .

After a date falling approximately five years following thedate of issuance, shareholders of the First Series Model AA
Class Shares shall have conversion right into Common
Shares and cash put options.

TMC’s right . . . . . . . . . . . . . . . . . . . . . . .

After a date falling approximately five years following thedate of issuance, TMC shall have cash call options.

The First Series Model AA Class Shares will not be treated as shareholders’ equity because the shareholdersof the First Series Model AA Class Shares will have cash put options and hence, the First Series Model AA Class
Shares will be reported as a separate line item between liabilities and shareholders’ equity.

F-73

TOYOTA MOTOR CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)(2) Repurchase of share in response to the issuance of the First Series Model AA Class Shares
At the Meeting of the Board of Directors held on June 16, 2015, TMC resolved to repurchase the Common
Shares pursuant to Article 156 of the Companies Act as applied to Article 165, Paragraph 3 of the Companies
Act, as set forth below.
Reason for repurchasing shares To avoid the dilution of the Common Shares as a result of the issuance of the First Series Model AA Class
Shares.
Details of matters relating to repurchase Kind of stock to be repurchased . . . . . . . . . . . . . . . . .

Common stock of TMC

Number of shares to be repurchased . . . . . . . . . . . . .

50,000,000 shares (maximum)

Total purchase price for repurchase of shares . . . . . .

¥600,000 million (maximum)

Method of acquisition . . . . . . . . . . . . . . . . . . . . . . . .

Purchase in the market

Period of repurchase . . . . . . . . . . . . . . . . . . . . . . . . . .

From July 27, 2015 to March 31, 2016

Repurchase of share At the Meeting of the Board of Directors held on May 8, 2015, TMC resolved to repurchase the Common
Shares pursuant to Article 156 of the Companies Act as applied to Article 165, Paragraph 3 of the Companies
Act, as set forth below.
Reason for repurchasing shares To return capital to shareholders in addition to promoting capital efficiency and agile capital policy in viewof the business environment.
Details of matters relating to repurchase Kind of stock to be repurchased . . . . . . . . . . . . . . . . .

Common stock of TMC

Number of shares to be repurchased . . . . . . . . . . . . .

40,000,000 shares (maximum)

Total purchase price for repurchase of shares . . . . . .

¥300,000 million (maximum)

Method of acquisition . . . . . . . . . . . . . . . . . . . . . . . .

Purchase in the market

Period of repurchase . . . . . . . . . . . . . . . . . . . . . . . . . .

After the issuance of the First Series Model AA
Class Shares, until March 31, 2016

F-74

ITEM 19. EXHIBITS
Index to Exhibits
1.1

Amended and Restated Articles of Incorporation of the Registrant (English translation)

1.2

Amended and Restated Regulations of the Board of Directors of the Registrant (English
translation)

1.3

Amended and Restated Regulations of the Audit & Supervisory Board of the Registrant (English
translation)

2.1

Amended and Restated Share Handling Regulations of the Registrant (English translation)

2.2

Form of Deposit Agreement among the Registrant, The Bank of New York (predecessor of The
Bank of New York Mellon), as depositary, and the owners and beneficial owners from time totime of American Depositary Receipts, including the form of American Depositary Receipt(incorporated by reference to Exhibit 1 to Toyota’s Registration Statement on Form F-6, filedwith the SEC on November 7, 2006 (file no. 333-138477))

2.3

Form of ADR (included in Exhibit 2.2)

8.1

List of Principal Subsidiaries (See “Organizational Structure” in “Item 4. Information on the
Company”)

11.1

Code of Ethics of the Registrant applicable to its members of the board of directors and managing
officers, including its principal executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions (English translation)

12.1

Certifications of the Registrant’s Chairman of the Board of Directors and Executive Vice
President, Member of the Board pursuant to Section 302 of the Sarbanes-Oxley Act

13.1

Certifications of the Registrant’s Chairman of the Board of Directors and Executive Vice
President, Member of the Board pursuant to Section 906 of the Sarbanes-Oxley Act

15.1

Consent of Independent Registered Public Accounting Firm

101.INSXBRL Instance Document

101.SCHXBRL Taxonomy Extension Schema

101.CALXBRL Taxonomy Extension Calculation Linkbase

101.DEFXBRL Taxonomy Extension Definition Linkbase

101.LABXBRL Taxonomy Extension Label Linkbase

101.PREXBRL Taxonomy Extension Presentation Linkbase

134

SIGNATURES
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has
duly caused and authorized the undersigned to sign this annual report on its behalf.
TOYOTA MOTOR CORPORATION
By:
Name:
Title:

Date: June 24, 2015/s/

TETSUYA OTAKE
Tetsuya Otake
Managing Officer

Exhibit 1.1(English Translation)

ARTICLES OF INCORPORATIONTOYOTA MOTOR CORPORATIONARTICLES OF INCORPORATION OF TOYOTA MOTOR CORPORATION(As amended on June 16, 2015)
CHAPTER I. GENERAL PROVISIONS
Article 1. (Trade Name)
The name of the Corporation shall be “Toyota Jidosha Kabushiki Kaisha” to be expressed in English as“TOYOTA MOTOR CORPORATION”.
Article 2. (Purpose)
The purpose of the Corporation shall be to engage in the following businesses:(1) the manufacture, sale, leasing and repair of motor vehicles, industrial vehicles, ships, aircraft, othertransportation machinery and apparatus, spacecraft and space machinery and apparatus, and parts
thereof;(2) the manufacture, sale, leasing and repair of industrial machinery and apparatus and other generalmachinery and apparatus, and parts thereof;(3) the manufacture, sale, leasing and repair of electrical machinery and apparatus, and parts thereof;(4) the manufacture, sale, leasing and repair of measuring machinery and apparatus, and medical
machinery and apparatus, and parts thereof;(5) the manufacture and sale of ceramics and products of synthetic resins, and materials thereof;(6) the manufacture, sale and repair of construction materials and equipment, furnishings and fixtures forresidential buildings;(7) the planning, designing, supervision, execution and undertaking of construction works, civilengineering works, land development, urban development and regional development;(8) the sale, purchase, leasing, brokerage and management of real estate;(9) the service of information processing, information communications and information supply, and thedevelopment, sale and leasing of software;(10) the design and development of product sales systems that utilize networks such as the Internet; sale,leasing, maintenance of computers included within such systems, and sales of products by utilizing
such systems;(11) the inland transportation, marine transportation, air transportation, stevedoring, warehousing andtourism businesses;(12) the printing, publishing, advertising and publicity, general leasing, security and workers dispatch
businesses;(13) the credit card operations, purchase and sale of securities, investment consulting, investment trust
operation, and other financial services;(14) the operation and management of such facilities as parking lots, showrooms, educational facilities,
medical care facilities, sports facilities, marinas, airfields, food and drink stands and restaurants,
lodging facilities, retail stores and others;(15) the non-life insurance agency business and life insurance agency business;(16) the production and processing by using biotechnology of agricultural products including trees, and thesale of such products;(17) the sale of goods related to each of the preceding items and mineral oil;

(18) the conducting of engineering, consulting, invention and research relating to each of the preceding
items and the utilization of such invention and research; and(19) any businesses incidental to or related to any of the preceding items.
Article 3. (Location of Principal Office)The principal office of the Corporation shall be located in Toyota City, Aichi Prefecture, Japan.
Article 4. (Public Notices)
Public notices of the Corporation shall be given electronically; provided, however, that in the case that anelectronic public notice is impracticable due to an accident or any other unavoidable reason, public notices of the
Corporation shall be given in the newspaper “The Nihon Keizai Shimbun”.
CHAPTER II. SHARESArticle 5. (Total Number of Authorized Shares, etc)
The total number of shares which the Corporation is authorized to issue shall be ten billion(10,000,000,000), and the total number of authorized shares in each class of class shares shall be as set forth
below; provided, however, that the aggregate number of shares authorized to be issued with respect to First
Series Model AA Class Shares through Fifth Series Model AA Class Shares shall not exceed one hundred fifty
million (150,000,000).
Common Shares:
ten billion (10,000,000,000) sharesFirst Series Model AA Class Shares:
fifty million (50,000,000) shares
Second Series Model AA Class Shares:
fifty million (50,000,000) shares
Third Series Model AA Class Shares:
fifty million (50,000,000) shares
Fourth Series Model AA Class Shares:
fifty million (50,000,000) shares
Fifth Series Model AA Class Shares:
fifty million (50,000,000) shares
Article 6. (Number of Shares Constituting One Unit (tangen) and Rights to Shares
Constituting Less than One Unit (tangen) )1.

The number of shares constituting one unit (tangen) of shares of the Corporation shall be one hundred(100) with respect to Common Shares and each class of Model AA Class Shares.

2.

The shareholders of the Corporation are not entitled to exercise any rights to shares constituting lessthan one unit (tangen) of shares held by the shareholders, other than the following:(1) the rights provided for in each Item of Article 189, Paragraph 2 of the Companies Act(Kaisha-hou); and(2) the rights provided for in Article 166, Paragraph 1 of the Companies Act, in respect of the rightprovided for in Article 18 of the Articles of Incorporation.

Article 7. (Acquisition of Own Shares)
The Corporation may acquire its own shares by a resolution of the Board of Directors in accordance with theprovisions of Article 165, Paragraph 2 of the Companies Act.
Article 8. (Absence of seller put options when the Corporation acquires Model AA Class Shares)
If the Corporation decides to acquire some or all of the Model AA Class Shares held by any holder of ModelAA Class Shares (“Model AA Class Shareholder”) under an agreement with such Model AA Class Shareholder
pursuant to a resolution of the general meeting of shareholders, and further decides to notify such Model AA
Class Shareholder of matters prescribed in any item of Article 157, Paragraph 1 of the Companies Act, theprovisions of Article 160, Paragraphs 2 and 3 of such act shall not apply.
Article 9. (Transfer Agent)
1.

The Corporation shall have a transfer agent (Kabunushimeibo-Kanrinin).

2.

The transfer agent and the location of its office shall be designated by a resolution of the Board of Directors,
and public notice thereof shall be given.

The register of shareholders and the register of stock acquisition rights shall be kept at the office of thetransfer agent. The entry or recording into the register of shareholders and the register of stock acquisition rights,
the purchase of shares constituting less than one unit (tangen) and any other matters related to the shares andstock acquisition rights shall be handled by the transfer agent and not by the Corporation.
Article 10. (Share Handling Regulations)
The procedures for and fees for the entry or recording into the register of shareholders and the register ofstock acquisition rights, purchasing shares constituting less than one unit (tangen) and any other matters relating
to the handling of shares and stock acquisition rights shall be subject to the Share Handling Regulations
established by the Board of Directors.
Article 11. (Record Date)
1.

The Corporation shall deem any shareholder entered or recorded in the final register of shareholders as ofMarch 31 in such year to be a shareholder entitled to exercise its rights at the ordinary general meeting ofshareholders for that business year.

2.

The preceding paragraph shall apply mutatis mutandis to class meetings, where the relevant class meeting is
to be held on the same date as an ordinary general meeting of shareholders.

3.

In addition to the case provided for in the preceding two (2) paragraphs, the Corporation may, after giving
prior public notice, fix a date as the record date, where it deems it necessary to do so.
CHAPTER III. MODEL AA CLASS SHARESArticle 12. (AA Dividends)
1.

In the event that the Corporation pays dividends from surplus as provided for in Article 46, Paragraph 1 ofthese Articles, it shall pay in cash year-end dividends from surplus in the amount specified below (“AADividends”) to Model AA Class Shareholders or registered pledgees of Model AA Class Shares (“AARegistered Pledgees”) entered or recorded in the final register of shareholders as of the record date for thedividends, in preference to holders of Common Shares (“Common Shareholders”) or registered pledgees ofCommon Shares (“Common Share Registered Pledgees”), respectively; provided that if AA Interim
Dividends, as provided for in Article 13 of these Articles, have been paid during the fiscal year in which therecord date falls, the amount of the AA Interim Dividends so paid shall be deducted from such AA
Dividends.

First Series Model AA Class Shares through Fifth Series Model AA Class Shares: An amount per ModelAA Class Share calculated by multiplying the amount per relevant Model AA Class Share paid to the
Corporation as consideration by a rate to be determined by the Board of Directors prior to the issuance ofeach Model AA Class Share (subject to a maximum of 5%).
2.

If the amount of the dividends from surplus paid in cash to Model AA Class Shareholders or AA Registered
Pledgees is less than the prescribed amount of AA Dividends in any fiscal year, the amount of the shortfall
per Model AA Class Share (“Cumulative Unpaid Dividends”) shall be carried forward and accumulated in
the following fiscal year and thereafter. With respect to the Cumulative Unpaid Dividends, dividends fromsurplus shall be paid in cash to Model AA Class Shareholders or AA Registered Pledgees until suchpayment reaches the amount of the Cumulative Unpaid Dividends per Model AA Class Share, in preference
to the payment of dividends from surplus as provided in the preceding paragraph or Article 13 of these
Articles.

3.

No distribution of dividends from surplus shall be made to any Model AA Class Shareholder or AA
Registered Pledgee in excess of the amount of AA Dividends, except for a distribution from surplus in theprocess of a corporate split (kyushu-bunkatsu) by the Corporation pursuant to Article 758, Item 8 (ii) or
Article 760, Item 7 (ii) of the Companies Act, or a distribution from surplus in the process of a corporate
split (shinsetsu-bunkatsu) by the Corporation pursuant to Article 763, Paragraph 1, Item 12 (ii) or
Article765 Paragraph 1, Item 8 (ii) of such act, in which case, the distribution from surplus shall be made to
all Model AA Class Shareholders or AA Registered Pledgees simultaneously and in the same proportion asthat made to any Common Shareholders or Common Share Registered Pledgees.

Article 13. (AA Interim Dividends)
In the event that the Corporation pays dividends from surplus as provided in Article 46, Paragraph 2 of these
Articles, the Corporation shall pay an amount equivalent to one-half of the prescribed amount of AA Dividends
in cash as interim dividends (“AA Interim Dividends”) per Model AA Class Share to Model AA Class
Shareholders or AA Registered Pledgees entered or recorded in the final register of shareholders as of the record
date with respect to such AA Interim Dividends, in preference to Common Shareholders or Common Share
Registered Pledgees.
Article 14. (Distribution of residual assets)
1.

In the event of a distribution by the Corporation of its residual assets, the Corporation shall pay the amountset forth below in cash to Model AA Class Shareholders or AA Registered Pledgees, in preference toCommon Shareholders or Common Share Registered Pledgees, respectively.
First Series Model AA Class Shares through Fifth Series Model AA Class Shares: An amount per ModelAA Class Share determined by resolution of the board of directors or an amount calculated under a formuladetermined by resolution of the board of directors, in either case based on the amount per relevant ModelAA Class Share paid to the Corporation as consideration (“Base Price”).

2.

No distribution of residual assets shall be made to Model AA Class Shareholders or AA Registered Pledgees
other than as provided in the preceding item.

Article 15. (Voting rights)
Model AA Class Shareholders shall have voting rights exercisable at general meetings of shareholders of the
Corporation.
Article 16. (Consolidation of shares, stock split or gratis allotment of shares)
1.

The Corporation shall effect any consolidation of shares or stock split simultaneously and in the same
proportion with respect to Common Shares and Model AA Class Shares.

2.

If the Corporation grants its shareholders rights to receive any allotment of shares offered for subscription or
stock acquisition rights offered for subscription, the Corporation shall grant Common Shareholders rights toreceive Common Shares or stock acquisition rights for Common Shares and shall grant Model AA Class
Shareholders rights to receive Model AA Class Shares of the Series held by such shareholders or stockacquisition rights for such Model AA Class Shares, as the case may be, simultaneously and in the same
proportion.
3.

If the Corporation makes a gratis allotment to its shareholders of shares or stock acquisition rights, theCorporation shall make the gratis allotment to Common Shareholders of Common Shares or stockacquisition rights for Common Shares, and shall make the gratis allotment to Model AA Class Shareholders
of Model AA Class Shares of the Series held by such shareholders or stock acquisition rights for such
Model AA Class Shares, as the case may be, simultaneously and in the same proportion.

Article 17. (Shareholder’s conversion right into Common Shares)
Model AA Class Shareholders may, at certain times specified therefor in resolutions of the board of
directors to be adopted upon issuance of First Series Model AA Class Shares through Fifth Series Model AA
Class Shares, demand that the Corporation acquire some or all of the relevant Model AA Class Shares held bysuch Model AA Class Shareholders in exchange for Common Shares, in numbers determined by formulaspecified in such resolutions. Any fractions of less than one share among Common Shares to be delivered in
exchange for such Model AA Class Shares shall be disregarded, in which case payment of money, as provided in
Article 167, Paragraph 3 of the Companies Act, shall not be made.
Article 18. (Shareholder’s cash put option)
Model AA Class Shareholders may, at certain times specified as put option periods in resolutions of theboard of directors to be adopted upon issuance of First Series Model AA Class Shares through Fifth Series ModelAA Class Shares, demand that the Corporation acquire some or all of the relevant Model AA Class Shares inexchange for cash in an amount equivalent to the Base Price. If the demand for acquisition exceeds the amountavailable for distribution as of the date of demand for such acquisition, as specified in Article 461, Paragraph 2 of
the Companies Act, Model AA Class Shares to be acquired by the Corporation shall be determined by resolutionof its board of directors, and the cash put option in respect of Model AA Class Shares not so acquired shall bedeemed not to have been exercised.
Article 19. (Corporation’s cash call option)
After the lapse of the period specified in resolutions of the board of directors to be adopted upon issuance ofFirst Series Model AA Class Shares through Fifth Series Model AA Class Shares following the issue of therelevant Model AA Class Shares, at an acquisition date separately determined by resolution of the board of
directors of the Corporation, the Corporation may acquire all of the relevant Series of Model AA Class Shares inexchange for cash in an amount equivalent to the Base Price.
Article 20. (Priority)
Each Model AA Class Share shall rank pari passu with every other Model AA Class Share in respect of the
AA Dividends, the AA Interim Dividends, the distributions from surplus provided for in the exceptions to
Article 12, Paragraph 3, and the distribution of residual assets.
Article 21. (Restrictions on transfer)1.

Acquisition of Model AA Class Shares by means of transfer will require the approval of the board of
directors of the Corporation.

2.

In the event that a tender offer as provided in Article 27-2, Paragraph 6 of the Financial Instruments andExchange Act is commenced for Model AA Class Shares and any Model AA Class Shareholder tenders its
Model AA Class Shares, upon the delivery of Model AA Class Shares or other transfer upon settlement, theBoard of Directors shall be deemed to have given approval as set forth in the preceding paragraph.

Article 22. (Prescription Period)
The provisions of Article 46, Paragraph 4 and Article 47 of these Articles shall apply mutatis mutandis tothe payment of AA Dividends and AA Interim Dividends.

CHAPTER IV. GENERAL MEETINGS OF SHAREHOLDERS
Article 23. (Ordinary General Meetings and Extraordinary General Meetings of Shareholders)1.

The ordinary general meeting of shareholders of the Corporation shall be convened in June of each year.
Extraordinary general meetings of shareholders may be called whenever necessary.

2.

Each general meeting of shareholders may be convened at the place where the principal office of the
Corporation is located, or at a place adjacent thereto, or in Nagoya City.

Article 24. (Resolutions)1.

All resolutions of a general meeting of shareholders shall be adopted by a majority of the votes of theshareholders present at the meeting who are entitled to vote, unless otherwise provided by laws andregulations or these Articles of Incorporation of the Corporation.

2.

Special resolutions as specified by Article 309, Paragraph 2 of the Companies Act shall be adopted by notless than two-thirds (2/3) of the votes of the shareholders present at the meeting who hold shares
representing in aggregate not less than one-third (1/3) of the voting rights of all shareholders who areentitled to vote.

Article 25. (Chairman of General Meeting)
1.

The Chairman of the Board or the President of the Corporation shall preside as chairman at a general
meeting of shareholders.

2.

In the event that the positions of both the Chairman of the Board and the President are vacant or that both ofthem are prevented from so presiding as chairman, another Director of the Corporation shall preside in theirplace according to the order of precedence previously established by the Board of Directors.

Article 26. (Exercise of Voting Rights by Proxy)1.

A shareholder may exercise its voting rights by proxy, provided, however, that the proxy shall be ashareholder of the Corporation who is entitled to exercise its own voting rights.

2.

In cases where the preceding paragraph applies, the shareholder or its proxy shall file with the Corporation adocument establishing the proxy’s power of representation for each general meeting of shareholders.

3.

The Corporation may refuse a shareholder having two (2) or more proxies attend a general meeting ofshareholders.

Article 27. (Deemed Delivery of Reference Documents, etc. for General Meeting of Shareholders)Upon convening a general meeting of shareholders, the Corporation may deem that the information which is
required to be described or indicated in reference documents for the general meeting of shareholders, business
reports, financial statements and consolidated financial statements shall be provided to the shareholders, in theevent that it is disclosed, pursuant to laws and regulations, through the method by which shareholders may
receive such information through an electronic means.
Articles 28. (Resolutions at class meetings)
1.

The provisions of Articles 25, 26 and 27 of these Articles shall apply mutatis mutandis to class meetings.

2.

The provisions of Article 24, Paragraph 1 of these Articles shall apply mutatis mutandis to the resolutions ofclass meetings made pursuant to Article 324, Paragraph 1 of the Companies Act.

3.

The provisions of Article 24, Paragraph 2 of these Articles shall apply mutatis mutandis to the resolutions ofclass meetings made pursuant to Article 324, Paragraph 2 of the Companies Act.

4.

No resolution of a class meeting of Model AA Class Shareholders shall be required in respect of any act
prescribed in any item of Article 322, Paragraph 1 of the Companies Act, unless otherwise specificallyprovided by law or regulation.

5.

No resolution of a class meeting of Model AA Class Shareholders shall be required under the provisions ofArticle 199, Paragraph 4 or Article 238, Paragraph 4 of the Companies Act.

CHAPTER V. MEMBERS OF THE BOARD OF DIRECTORS AND BOARD OF DIRECTORS
Article 29. (Number of Directors)
The Corporation shall have no more than twenty (20) Directors.
Article 30. (Election of Directors)
1.

Directors shall be elected by a resolution of a general meeting of shareholders.

2.

A resolution for the election of Directors shall be adopted by a majority vote of the shareholders present at
the meeting who hold shares representing in aggregate not less than one-third (1/3) of the voting rights of all
the shareholders who are entitled to vote.

3.

The election of Directors shall not be made by cumulative voting.

Article 31. (Term of Office of Directors)
1.

The term of office of Directors shall expire at the closing of the ordinary general meeting of shareholders tobe held for the last business year of the Corporation ending within one (1) year after their election.

2.

The term of office of any Director elected in order to increase the number of Directors or to fill a vacancy
shall be the balance of the term of office of the other Directors who hold office at the time of his/herelection.

Article 32. (Board of Directors)
1.

The Corporation shall have a Board of Directors.

2.

Notice of a meeting of the Board of Directors shall be dispatched to each Director and each Audit &Supervisory Board Member at least three (3) days before the date of the meeting. In case of urgency,
however, such period may be shortened.

3.

With respect to matters to be resolved by the Board of Directors, the Corporation shall deem that suchmatters were approved by a resolution of the Board of Directors when all the Directors express theiragreement in writing or by electronic records. Provided, however, that this provision shall not apply when
any Audit & Supervisory Board Member expresses his/her objection to such matters.

4.

In addition to the preceding two (2) paragraphs, the management of the Board of Directors shall be subject
to the Regulations of the Board of Directors established by the Board of Directors.

Article 33. (Representative Directors and Executive Directors)
1.

The Board of Directors shall designate one or more Representative Directors by its resolution.

2.

The Board of Directors may appoint one Chairman of the Board, one President and one or more Vice
Chairmen of the Board and Executive Vice Presidents by its resolution.

Article 34. (Honorary Chairmen and Senior Advisors)
The Board of Directors may appoint Honorary Chairmen and Senior Advisors by its resolution.
Article 35. (Exemption from Liability of Directors)
In accordance with the provisions of Article 426, Paragraph 1 of the Companies Act, the Corporation may,by a resolution of the Board of Directors, exempt Directors (including former Directors) from liabilities provided
for in Article 423, Paragraph 1 of the Companies Act within the limits stipulated by laws and regulations.
Article 36. (Limited Liability Agreement with members of the Board of Directors)
In accordance with the provisions of Article 427, Paragraph 1 of the Companies Act, the Corporation may
enter into an agreement with Members of the Board of Directors (excluding Executive Members of the Board of
Directors, etc.) limiting liabilities provided for in Article 423, Paragraph 1 of the Companies Act; provided,
however, that the limit of the liability under the agreement shall be the minimum amount of liability stipulated bylaws and regulations.
CHAPTER VI. AUDIT & SUPERVISORY BOARD MEMBERS AND
AUDIT & SUPERVISORY BOARD
Article 37. (Establishment of Audit & Supervisory Board Members and Number of Audit & Supervisory
Board Members)
The Corporation shall have no more than seven (7) Audit & Supervisory Board Members.
Article 38. (Election of Audit & Supervisory Board Members)
1.

Audit & Supervisory Board Members shall be elected by a resolution of a general meeting of shareholders.

2.

A resolution for the election of Audit & Supervisory Board Members shall be adopted by a majority vote of
the shareholders present at the meeting who hold shares representing in aggregate not less than one-third(1/3) of the voting rights of all the shareholders who are entitled to vote.

Article 39. (Term of Office of Audit & Supervisory Board Members)
1.

The term of office of Audit & Supervisory Board Members shall expire at the closing of the ordinary
general meeting of shareholders to be held for the last business year of the Corporation ending within four(4) years after their election.

2.

The term of office of any Audit & Supervisory Board Member elected to fill a vacancy shall be the balanceof the term of office of the Audit & Supervisory Board Member whom he/she succeeds.

Article 40. (Audit & Supervisory Board)
1.

The Corporation shall have an Audit & Supervisory Board.

2.

Notice of a meeting of the Audit & Supervisory Board shall be dispatched to each Audit & Supervisory
Board Members at least three (3) days before the date of the meeting. In case of urgency, however, such
period may be shortened.

3.

In addition to the provisions of the preceding paragraph, the management of the Audit & Supervisory Board
shall be subject to the Regulations of the Audit & Supervisory Board established by the Audit &Supervisory Board.

Article 41. (Full-time Audit & Supervisory Board Member)
The Audit & Supervisory Board shall, by its resolution, select one or more full-time Audit & Supervisory
Board Members.

Article 42. (Exemption from Liability of Audit & Supervisory Board Members)
In accordance with the provisions of Article 426, Paragraph 1 of the Companies Act, the Corporation may,by a resolution of the Board of Directors, exempt Audit & Supervisory Board Members (including former
Audit & Supervisory Board Members) from liabilities provided for in Article 423, Paragraph 1 of the Companies
Act within the limits stipulated by laws and regulations.

Article 43. (Limited Liability Agreement with Audit & Supervisory Board Members)
In accordance with the provisions of Article 427, Paragraph 1 of the Companies Act, the Corporation may
enter into an agreement with Audit & Supervisory Board Members limiting liabilities provided for in Article 423,
Paragraph 1 of the Companies Act; provided, however, that the limit of the liability under the agreement shall be
the minimum amount of liability stipulated by laws and regulations.

CHAPTER VII. ACCOUNTING AUDITOR
Article 44. (Accounting Auditor)
The Corporation shall have an Accounting Auditor(kaikeikansa-nin).

CHAPTER VIII. ACCOUNTS
Article 45. (Business Year)The business year of the Corporation shall be one (1) year from April 1 of each year until March 31 of thefollowing year.

Article 46. (Dividends from Surplus, etc.)
1.

Dividends from Surplus of the Corporation shall be paid to the shareholders or registered share pledgees
entered or recorded in the final register of shareholders as of March 31 of each year.

2.

The Corporation may, by a resolution of the Board of Directors, distribute dividends from surplus asprovided for in Article 454, Paragraph 5 of the Companies Act to the shareholders or registered sharepledgees entered or recorded in the final register of shareholders as of September 30 of each year.

3.

In addition to the preceding two (2) paragraphs, the Corporation may, by a resolution of the Board of
Directors, decide on matters provided for in each Item of Article 459, Paragraph 1 of the Companies Act.

4.

No interest shall be paid on unpaid dividends from surplus.

Article 47. (Dispensation from Payment of Dividends from Surplus, etc.)
In the case where the dividends from surplus are paid by cash, the Corporation shall not be obliged to pay
any dividends from surplus after three (3) years have expired from the date of tender thereof.

Exhibit 1.2(TRANSLATION)REGULATIONS OF
THE BOARD OF DIRECTORSOFTOYOTA MOTOR CORPORATION
Established: February 27, 1952
As last amended on June 17, 2015
(Aa004-18)
Article 1. (Regulations of the Board of Directors)
Except as provided for in laws, ordinances or the Articles of Incorporation, matters relating to the Board of
Directors of Toyota Motor Corporation (the “Company”) shall be governed by the provisions of theseRegulations.
Article 2. (Purpose and Composition)
1.

The Board of Directors shall be composed of all the Members of the Board of Directors and shall makedecisions on the execution of business, supervise the execution of the duties of Members of the Board of
Directors, and designate and dismiss the Representative Directors.

2.

Audit & Supervisory Board Members shall be present and, whenever necessary, give their opinions at a
meeting of the Board of Directors.

3.

Senior Managing Officers and Managing Officers shall be present only to the extent required to give
explanation for matters to be resolved and to be reported in case of such attendance permitted by Board of
Directors related to the matters to be resolved and reported. However, Senior Managing Officers andManaging Officers are not able to participate in resolutions.

Article 3. (Person to Convene Meeting and Notice of Meeting)1.

A meeting of the Board of Directors shall be convened by the Chairman of the Board of Directors or the
President, Member of the Board of Directors. In the event that the positions of both the Chairman of theBoard of Directors and the President, Member of the Board of Directors are vacant or that both of them areprevented from convening, such meeting shall be convened by the Vice Chairman of the Board of Directors,
the Executive Vice President, Member of the Board of Directors or other Members of the Board of Directors
in that order and according to their rank, if there are multiple persons holding the same position.

2.

Notice of convening a meeting of the Board of Directors shall be dispatched to each Member of the Boardof Directors and each Audit & Supervisory Board Member at least three (3) days before the date of themeeting. In the case of urgency, however, such period may be shortened.

3.

A meeting of the Board of Directors may be held without following the convening procedure, if consented
to by all the Members of the Board of Directors and the Audit & Supervisory Board Members.

Article 4. (Chairmanship and Method of Adopting Resolutions)
1.

The Chairman of the Board of Directors or the President, Member of the Board of Directors shall preside aschairman at a meeting of the Board of Directors. In the event that the positions of both the Chairman of theBoard of Directors and the President, Member of the Board of Directors are vacant or that both of them areprevented from so presiding as chairman, the Vice Chairman of the Board of Directors, the Executive Vice
President, Member of the Board of Directors or other Member of the Board of Directors shall preside aschairman in that order and according to their rank in the case that there are multiple persons holding thesame position.

2.

Resolutions of the Board of Directors shall be adopted at meetings at which a majority of the Members of
the Board of Directors who are entitled to vote shall be present by a majority of the Members of the Boardof Directors so present.

3.

With respect to matters to be resolved by the Board of Directors, the Company shall deem that such matterswere approved by a resolution of the Board of Directors when all the Members of the Board of Directors
express their agreement in writing or by electronic records. Provided, however, that this provision shall not
apply when any Audit & Supervisory Board Member expresses his/her objection to such matters.

4.

With respect to matters to be reported to the Board of Directors, Members of the Board of Directors,
Audit & Supervisory Board Members or Accounting Auditors shall not be required to report such matters to
the Board of Directors when such matters are notified to all the Members of the Board of Directors andAudit & Supervisory Board Members.

Article 5. (Matters to be Resolved)
The following matters shall be subject to the resolution of the Board of Directors:(1) Matters provided for in the Companies Act or other laws or ordinances;(2) Matters provided for in the Articles of Incorporation;(3) Matters delegated to the Board of Directors by resolution of a general meeting of shareholders; and(4) Other important managerial matters.
Article 6. (Matters to Be Reported)
Members of the Board of Directors shall report to the Board of Directors on the following matters:(1) State of execution of business and such other matters as are provided for in the Companies Act or other laws
or ordinances; and(2) Such other matters as the Board of Directors may deem necessary.
Article 7. (Meetings and Minutes)
1.

A meeting of the Board of Directors shall be held in Japanese, minutes shall be prepared each time ameeting of the Board of Directors is held and such minutes shall be kept on file at the head office for ten
years.

2.

Minutes shall set forth matters provided for in the laws or ordinances and the Members of the Board of
Directors and Audit & Supervisory Board Members present shall sign or affix their names and seals thereto.

3.

Minutes shall be prepared in Japanese.

Article 8. (TMC Executives’ Meeting)
1.

The Board of Directors shall establish TMC Executives’ meeting in which important matters are discussed
in order to enhance efficiency and effectiveness of decision-making on management and execution of thebusiness of the Company.

2.

Matters related to the establishment, changes in functions, and abolishment of TMC Executives’ meetingshall be submitted to the Board of Directors.
Supplementary Provisions

Article 1. (Effective Date)
These Regulations shall become effective as of June 17, 2015.
Article 2. (Amendment to Regulations)
Any amendment to these Regulations shall be made by a resolution of the Board of Directors.

MATTERS TO BE SUBMITTED TO THE BOARD OF DIRECTORS
General Rules of the “Matters To Be Submitted To The Board of Directors” (this “List”)
1.

Pursuant to Article 5(1), (2) and (3) of the Regulations of the Board of Directors, matters and items
defined in I-1, 2 and 3 of this List shall, without fail, be submitted to the Board of Directors.

2.

In addition, pursuant to Article 5(4) of the Regulations of the Board of Directors, for matters and items
defined in I-4 of this List, materiality must be appropriately judged and matters must be submitted
accordingly to the Board of Directors.

3.

Materiality shall be determined by Chief Officers, Deputy Chief Officers (and Executives responsiblefor individual Divisions for those under the direct control) taking into consideration “submission
standards,” “special rules,” “definitions” and “explanations” in this List. If the amount of transaction
does not meet the submission standards at first, but there occurs a possibility that it may exceed suchstandards later on, such transaction shall be submitted to the Board of Directors at the time suchpossibility arises.

4.

Pursuant to Article 6 of the Regulations of the Board of Directors, matters and items defined in II ofthis List shall be reported to the Board of Directors without delay.

Standard for re-submission
If material changes are made to a matter previously submitted to the Board of Directors (such as 20% ormore of increase in the amount approved by the Board of Directors), such matter shall be re-submitted to theBoard of Directors.

I.

Matters to be Resolved:
1.

Matters provided for in the Companies Act or other laws or ordinances:Classifications

Items

Relevant Articles
of Applicable Law

Shares; stockacquisitionrights:Fixing the record date

Article 124

Acquisition of the Company’s own shares held by its subsidiaries

Article 163

Cancellation of the Company’s own shares

Article 178

Share-splits

Article 183

Free Allotment of shares

Article 186

Reduction of the number of shares constituting one unit (tangen) of shares orabolishment of the provisions which define such number

Article 195

Auction of shares held by shareholders whose whereabouts are unknown

Article 197

Issuance of new shares

Article 201

Disposition of the Company’s own shares

Article 201

Approval of undertaking a contract for the total number of shares ofsubscription or similar ones with transfer restrictions

Articles 205 and244

Issuance of stock acquisition rights

Article 240

Approval of transferring stock acquisition rights with transfer restrictions

Article 265

Acquisition of stock acquisition rights with acquisition clause

Articles 273 and274

Cancellation of stock acquisition rights

Article 276

Free Allotment of stock acquisition rights

Article 278

Convening of a general meeting of shareholders

Article 298

Designation and dismissal of Representative Directors

Article 362

Approval of Members of the Board of Directors’ competing transactions

Article 365

Generalmeetings ofshareholders:
Board ofDirectors;
Members of
the Board of
Directors:

Approval of Members of the Board of Directors’ transactions for their own Article 365
account

Accounts:

Approval of Members of the Board of Directors’ transactions involving
conflict of interests

Article 365

Approval of financial statements, business reports and the accompanying
detailed statements

Article 436

Approval of extraordinary financial statements

Article 441

Approval of consolidated financial statements

Article 444

Reduction in the amount of capital (with conditions)

Article 447

Reduction in the amount of reserves (with conditions)

Article 448

Classifications

Items

Relevant Articles
of Applicable Law

Bonds:

Offering of bonds

Article 362

Issuance of bonds with stock acquisition rights

Article 240

Disposition and acquisition of important property

Article 362

Borrowing of a large amount of money

Article 362

Appointment and removal of managers and other important employees

Article 362

Establishment, alteration and abolishment of branch offices and otherimportant organizations

Article 362

Development of a system to ensure the appropriateness of business
operations of the Company and business group consisting of the parent
company and subsidiaries

Article 362

Other important business execution

Article 362

Others:2.

Matters provided for in the Articles of Incorporation:

Classifications

Items

Relevant Articlesof the Articles ofIncorporation

Shares:Acquisition of Company’s own shares

Articles 7 and 46

Acquisition of shares with acquisition clause

Article 19

Selection of registration agent and its location of business

Article 9

Amendment to the Share Handling Regulations

Article 10

Approval of transferring shares with transfer restrictions

Article 21

The order in which to assume chairmanship of a general meeting ofshareholders

Article 25

Appointment and removal of Members of the Board of Directors withspecific titles

Article 33

Amendment to the Regulations of the Board of Directors

Article 32

Exemption of Members of the Board of Director from their liabilities

Article 35

Audit &
Supervisory
Board
Members:

Exemption of Audit & Supervisory Board Members from their liabilities

Article 42

Accounts:

Distribution of interim dividends from surplus

Article 46

Reduction in the amount of reserves

Article 46

Other disposition of surplus

Article 46

Distribution of dividends from surplus

Article 46

Appointment of Honorary Chairman and Senior Advisor

Article 34

Generalmeeting ofshareholders:
Board ofDirectors;
Members of
the Board of
Directors:

Others:3.

Matters delegated to the Board of Directors by resolution of a general meeting of shareholders:Classifications

Items

Shares:Acquisition of Company’s own shares
Issuance of new shares or stock acquisition rights on favorable conditions

Others:4.

Other matters delegated to the Board of Directors
Other important managerial matters:

Classifications

Items

Management: Corporate policies
Important business alliances and important joint ventures
Launching of new projects
Short-form and simplified corporate splits
Short-form and simplified share exchanges
Simplified acquisition of an entire business of another company
Approval of interim and quarterly accounts
Approval of consolidated accounts (including interim and quarterly accounts)
Institution of important legal actions and defending and responding to important disputes
Establishment, changes in functions, and abolishment of TMC Executives’ meeting
Other important matters
Personnel
affairs;organization:

Members of the Board of Directors, Senior Managing Officers, Managing Officers, andExecutive General Managers’ (jyomu riji) assumption of offices in other companies (in the caseof new offices in listed companies only)
Members of the Board of Directors, Senior Managing Officers, and Managing Officers’
assumption of offices in important associations (in the case of new offices only)
Assignment of Members of the Board of Directors, Senior Managing Officers, and Managing
Officers to take charge of group, field, plant, technical center and any other organizations similar
thereto (Excluding changes in the same organization)
Treatment and discipline relating to Members of the Board of Directors, Senior Managing
Officers, and Managing Officers
Appointment and removal of Senior Managing Officers and Managing Officers
Appointment and removal of Senior Technical Executive (gikan) and Advisor (komon)
Approval of Senior Managing Officers and Managing Officers’ competing transactions
Approval of Senior Managing Officers and Managing Officers’ transactions for their own
account
Approval of Senior Managing Officers and Managing Officers’ transactions involving conflict ofinterests
Changes in important working conditions
Other important matters

Classifications

Items

Production;
Sales;
Technology
development: Long-term or annual production, shipment or sales plans
Long-term or annual equipment plans
Licensing, acquisition or transfer of important intellectual property rights
Other important mattersGroupmanagement: Incorporation, dissolution, acquisition and transfer of subsidiaries
Important group managerial matters
Other important matters
Others:Other important managerial matters

II. Matters to be reported:
Items

Relevant Articles of Applicable Law

State of execution of businessCompanies Act
Article 363

Important facts about a competing transaction

Article 365

Important facts about any Member of the Board of Director’stransactions for his/her own accounts

Article 365

Important facts about any transactions involving conflict ofinterests

Article 365

Members of the Board of Directors, Senior Managing Officers,
Managing Officers and Executive General Managers’ (jyomu riji)
retirement from offices in other companies (Listed companies only)
Members of the Board of Directors, Senior Managing Officers, andManaging Officers’ retirement from offices in important
associations
Audit & Supervisory Board Members’ assumption (in the case of
new offices only) and retirement from offices in other companies(Listed companies only)
Audit & Supervisory Board Members’ assumption (in the case of
new offices only) and retirement from offices in important
associations
Monthly production/shipment/sales results
Important matters, such as incorporation of subsidiaries by a joint
venture company
Management status of a system to ensure the appropriateness ofbusiness operations of the Company and business group consistingof the parent company and subsidiaries
Other important matters

Article 362

1. Out of “I. Matters to be Resolved” of the “Matters to be Submitted to the Board of Directors”, the mattersdescribed in “Others” in “1. Matters provided for in the Companies Act or other laws or ordinances” shall be
submitted to the Board of Directors in accordance with the standards contained in this Appendix 1.
Appendix 1
Items

Standard(1) Disposition and acquisition of important property:
1purchase and disposition of land (excluding
land for business use)

5,000,000,000 Yen*1 or more per transaction2acquisition and transfer of leaseholds

5,000,000,000 Yen*2 or more per transaction

3

investments (excluding fund management
investments)

5,000,000,000 Yen*3 or more per transaction

4

capital expenditure (excluding model change
and renewal of aging assets)

30,000,000,000 Yen*4 or more per transaction

5loans (excluding renewal of bills and notes,
and loans as part of financial business)

5,000,000,000 Yen*5 or more per transaction, or loans
outstanding of 5,000,000,000 Yen*5 or more percompany6discharge of debts

200,000,000 Yen or more per transaction

7

donations (excluding those via Japan
Automobile Manufacturers Association, Inc.)

200,000,000 Yen or more per transaction(2) Borrowings of large amounts of money:
1borrowing

5,000,000,000 Yen or more per transaction

2

guarantee of obligations

5,000,000,000 Yen*6 or more per transaction, or
outstanding guarantee of obligation of 5,000,000,000
Yen*6 or more per company(3) Appointment and removal of managers and otherimportant employees

Assignment of Executive General Manager (jyomuriji) and any other personnel similar thereto to takecharge of group, field, plant, technical center and anyother organizations similar thereto (excludingtransfers within the same organization)
Appointment of operating officers at membershipcompanies (limited liability company, etc.) andlimited liability partnerships, and removal of
operating officers at such companies*7(4) Establishment, alteration and abolishment of branch
offices and other important organizations

Establishment, alteration and abolishment of group,
field, plant, technical center and any other similarorganizations(*1) Purchase and disposition of land
In the case where any of the acquisition price, book value, or transaction price is 5,000,000,000 Yen or more
per transaction, a submission shall be required.
(*2) Definition of “leaseholds”“Leasehold” is a right which is obtained by a temporary payment of concession money as a setup fee forleasehold, when leasing land for the purpose of owning buildings (excluding parking space, etc.).

(*3) Special rules regarding “investment”(I)

Even if the amount is below 5,000,000,000 Yen, if the conditions match either of the following, asubmission shall be required.
(i)

Investment made to subsidiaries which were insolvent as of the end of the most recent closing dateof accounts or those anticipated to become insolvent during their current fiscal period.

(ii) Investment made to companies other than the subsidiaries.
(II) Notwithstanding (I) above, such submission may be omitted by the decision(s) of the Executive Vice
President(s) whose main duties are in relation to the division in charge of the case concerned and to theaccounting areas, in the case where the amount of investment is below 2,000,000,000 Yen.
(III) After the investment is made, if such investment comes to fall under (i) or (ii) in (I) above, whether or
not to submit such matter to the Board of Directors shall be decided by the Executive Vice President(s)as defined in (II) above.
(*4) Capital expenditure
1

Explanation of “capital expenditure”
The main coverage of this item shall be those such as the construction of new factories, productionlines, buildings and sales bases, among others, which change the structure of business and may
possibly pose new management risks.

2Special rules regarding “capital expenditure”(I)

Even if the amount is below 30,000,000,000 Yen, if new factories are constructed, a submission shallbe required.

(II) In making a submission, attention shall be made to show a project overall picture such as vehicles andunit components.
(*5) Special rules regarding “loans”(I)

Even if the amount is below 5,000,000,000 Yen, if the conditions match any of the following, asubmission shall be required.
(i)

Loans made available to companies which were insolvent as at the end of the most recent closing
date of accounts or those anticipated to become insolvent during their current fiscal period(whether or not such finance is directed to the subsidiaries).

(ii) Loans made available to companies (excluding the subsidiaries) which have their head officelocated in countries or areas having a country risk rating below A.
(iii) Unsecured loans made available to companies other than the subsidiaries.
(II) Notwithstanding (I) above, such submission may be omitted by the decision(s) of the Executive Vice
President(s) whose main duties are in relation to the division in charge of the case concerned and to theaccounting areas, in the case where amounts of loans and loans outstanding are below
2,000,000,000 Yen.
(III) After the loan is made available, if such loan comes to fall under (i), (ii) or (iii) in (I) above, whether or
not to submit such matter to the Board of Directors shall be decided by the Executive Vice President(s)as defined in (II) above.
(*6) Special rules regarding “guarantee of obligations”(I)

Even if the amount is below 5,000,000,000 Yen, if the conditions match either of the following, asubmission shall be required.
(i)

Guarantee of obligation made to subsidiaries which were insolvent as at the end of the most recent
closing date of accounts or those anticipated to become insolvent during their current fiscal
period.

(ii) Guarantee of obligation made to companies other than the subsidiaries.

(II) Notwithstanding (I) above, such submission may be omitted by the decision(s) of the Executive Vice
President(s) whose main duties are in relation to the division in charge of the case concerned and to theaccounting areas, in the case where amounts of guarantee of obligation and outstanding guarantee ofobligation are below 2,000,000,000 Yen.
(III) After the guarantee of obligation is made, if such guarantee comes to fall under (i) or (ii) in (I) above,
whether or not to submit such matter to the Board of Directors shall be decided by the Executive Vice
President(s) as defined in (II) above.
(*7) Special rules regarding “membership companies (limited liability company, etc.) and limited liability
partnerships”(I)

An overall business plan must be submitted when a membership company (LLC, etc.) and LLP isestablished or investment is newly made.

(II) If material changes are made to a business plan previously submitted to a meeting of the Board of
Directors, such matters shall be re-submitted to a meeting of the Board of Directors.
2. Out of “I. Matters to be Resolved” of the “Matters to be Submitted to the Board of Directors”, the mattersrelating to “Management” in “4. Other important managerial matters” shall be submitted to the Board of
Directors in accordance with the standards contained in this Appendix 2.
Appendix 2
Items

Standard(1) Important business alliances and important joint
ventures:12

definition of “business alliance” and “joint
venture”(1) “Business alliance”

Used when businesses such as sales tie-up,
continuous provision of products, acceptance/
entrustment of production, joint production, joint
development, or technology licensing, etc. arecommenced or terminated, or material changes withrespect to these businesses are made.

(2) “Joint venture”

Used when Toyota Motor Corporation (“TMC”) anda business partner or its subsidiary make joint
investment to establish or acquire a joint venturecompany and have such joint venture company
conduct businesses for the purposes of the subject
joint venture.

materiality standards for “important businessalliances and important joint ventures” *1(1) Monetary standard

In case TMC plans to spend 5,000,000,000 Yen or
more in total for loan and investment, capital
expenditures, etc. at the beginning of the plan.

(2) Qualitative standard

In case the subject business alliance or joint venture(including with a dominant competitor) may
materially affect TMC’s management in terms ofsales, profits, etc.

ItemsStandard(2) Launching of new projects:
1

definition of “launching of new projects”

Used when TMC launches a business not relating to
its existing business areas (such as automobiles,
industrial vehicles, housing, information andtelecommunication, boats and ships, airplanes,
biotechnology or financial businesses.)
Other than launch of business by TMC itself, launchof business through business alliance or through its
subsidiary or joint venture company (excluding
companies in which TMC invests without being
required to include such companies’ operating results
in its consolidated financial statements pursuant to
the Financial Instruments and Exchange Act) shallalso be considered as “launching of new projects.”(3) Institution of important legal actions and defending
and responding to important disputes *2
1

Monetary standard

In case that value of subjects (including rights andobligations) that are subject to legal action (in a
response to legal action, reasonable amount for
settlement) is 2,000,000,000 Yen or more.

2

Qualitative standard

In case of legal actions such as filing of legal action
with respect to important intellectual property rights
or dispute with a public entity with respect toenvironmental issues, which may materially affect
TMC’s management, business, rights or brand image,etc.

(*1) Materiality standards for “important business alliances and important joint ventures”
If a business alliance or joint venture falls under either the “Monetary standard” or “Qualitative standard”, itshall be submitted to the Board of Directors.
(*2) Materiality standards for “institution of important legal actions and defending against and responding toimportant disputes”
If a case falls under either “Monetary standard” or “Qualitative standard”, it shall be submitted to the Boardof Directors.

3. Out of “I. Matters to be Resolved” of the “Matters to be Submitted to the Board of Directors”, the mattersrelating to “Personnel affairs, organization” in “4. Other important managerial matters” shall be submitted to theBoard of Directors in accordance with the standards contained in this Appendix 3.
Appendix 3
Items

Standard(1) Members of the Board of Directors, Senior
Managing Officers, and Managing Officers’
assumption of offices in important associations (incase of new offices only)

In case that Members of the Board of Directors, Audit& Supervisory Board Members, Senior Managing
Officers, or Managing Officers of TMC assume orresign from a position such as chairman, board
chairman, committee chairman, etc. of Japan Business
Federation, The Japan Chamber of Commerce andIndustry, Japan Association of Corporate Executives,
Japan Automobile Manufacturer Association, Counselof government authorities or other important
associations comparable to these associations(2) Changes in important working conditions:

In case that certain actions such as changes inworking conditions with respect to employment
which may materially affect TMC’s management andemployees

4. Out of “I. Matters to be Resolved” of the “Matters to be Submitted to the Board of Directors”, the mattersrelating to “Production; Sales; Technology development” in “4. Other important managerial matters” shall be
submitted to the Board of Directors in accordance with the standards contained in this Appendix 4.
Appendix 4
Materiality standard for “licensing, acquisition or transfer of important intellectual property rights”
Certain actions such as licensing of intellectual property rights relating to TMC’s essential technologies ortransfer of TMC’s trademark, which may materially affect TMC’s management, such licensing, transfer or
acquisition shall be deemed material.

5. Out of “I. Matters to be Resolved” of the “Matters to be Submitted to the Board of Directors”, the mattersrelating to “Group Management” in “4. Other important managerial matters” shall be submitted to the Board of
Directors in accordance with the standards contained in this Appendix 5.
Appendix 5
Items

Standard(1) Incorporation, dissolution, acquisition and transferof subsidiaries:
1

2

definition of “incorporation, dissolution,acquisition and transfer of subsidiaries”(1) “Subsidiary”

A joint stock company of which TMC holds amajority of its voting rights, or other companies
judged to be a subsidiary of TMC pursuant to
Article 3 of the Implementation Rules of theCompanies Act. (including a membership company
such as a limited liability company, a partnership,
any other business entities similar thereto)(2) “Incorporation”

Used when a subsidiary is established.

(3) “Dissolution”

Used when a subsidiary is dissolved.

(4) “Acquisition”

Used when a subsidiary is obtained through, forexample, acquisition of shares (excluding cases
which fall under incorporation).

(5) “Transfer”

Used when a company loses its status as a subsidiaryof TMC through, for example, TMC’s sale of sharesof the subsidiary (excluding cases which fall under
dissolution).

submission standard of “incorporation,
dissolution, acquisition and transfer ofsubsidiaries”(1) Directly held subsidiary*1

Matters to be resolved(2) Principal subsidiary, not falling under (1)above*2

Matters to be resolved(3) Subsidiary with capital of 2,000,000,000 Matters to be reported
Yen or more, not falling under (1) or (2)above(4) Subsidiary, not falling under (1)-(3)above

Submission not necessary in principle(2) Important group managerial matters*3
1

Monetary standard

In case a wholly owned subsidiary*i conducts
Items 1~5 of “Disposition and acquisition ofimportant property” as defined above, amounts,
quantities, special rules, definitions and explanationsof the same Items shall apply.

ItemsStandard

However, such submission may be omitted, in thecase where submission of a matter is a formality, thematter virtually requires no managerial decision(transfer of land/equipment conducted between
wholly owned subsidiaries etc.) and the matter isjudged not to have TMC’s group managerialmateriality.
2

Qualitative standard

If in case of “Disposition and acquisition ofimportant property”*ii, “Borrowing of a large amountof money”*iii, business alliance, joint venture or
reorganization of business, etc., conducted bysubsidiary of TMC, which may materially affect
TMC’s group management and reputation*iv.

(*1) “Directly held subsidiary” shall mean a subsidiary of which TMC directly holds a majority of the total
voting rights.
(*2) Examples of “principal subsidiary” are as follows:(i)

Subsidiary engaged in a new business(ii) Subsidiary with a substantial amount of capital (5,000,000,000 Yen or more)(iii) Subsidiary established as a result of a business alliance or joint venture with a dominant competitor(iv) Subsidiary which was insolvent as of the end of the most recent closing date of accounts or that is
anticipated to become insolvent during its current fiscal period (this shall apply only to acquisition)(v) Other managerially important subsidiary(*3) If a matter falls under either “Monetary standard” or “Qualitative standard”, it shall be submitted to theBoard of Directors.
(*i)“Wholly owned subsidiary” shall mean a subsidiary of which TMC directly or indirectly holds all of thetotal voting rights.

(*ii) In conducting Items 1~7 of “Disposition and acquisition of important property” as defined above,materiality shall be determined with reference to amount, quantity, special rules, definition and explanation
defined in the same Items.
(*iii) In conducting Items 1~2 of “Borrowing of a large amount of money” as defined above, materiality shall be
determined with reference to amount, quantity and special rules defined in the same Items.
(*iv) With respect to other items, materiality shall be determined with reference to TMC’s submission standardsof matters to be submitted to the Board of Directors.

Exhibit 1.3(TRANSLATION)REGULATIONS OF
THE AUDIT & SUPERVISORY BOARDOF
TOYOTA MOTOR CORPORATION
Established: September 27, 1994
As last amended on August 29, 2011
Article 1. (Regulations of the Audit & Supervisory Board)
Except as provided for by laws, ordinances or the Articles of Incorporation, the matters relating to the
Audit & Supervisory Board of the Corporation shall be governed by the provisions of these Regulations.
Article 2. (Composition)
The Audit & Supervisory Board shall be composed of all the Audit & Supervisory Board Members.
Article 3. (Person Authorized to Convene the Meeting and Notice of the Meeting)1.

A meeting of the Audit & Supervisory Board shall be convened by the Audit & Supervisory Board Member
who has been determined in advance by a resolution at the meeting of the Audit & Supervisory Board;
provided, however, that the other Audit & Supervisory Board Members shall not be prevented fromconvening the meeting thereof.

2.

In order to convene a meeting of the Audit & Supervisory Board, such Audit & Supervisory Board Member
referred to in the preceding paragraph shall dispatch a notice thereof to each Audit & Supervisory Board
Member at least three (3) days before the date of the meeting, provided that, in the case of urgency, such
period may be shortened.

3.

Notwithstanding the provision of the preceding paragraph, the meeting of the Audit & Supervisory Board
may be held without the convening procedure, if so consented to by all the Audit & Supervisory Board
Members.

Article 4. (Chairmanship and Method of Resolution)
1.

The chairmanship of the meeting of the Audit & Supervisory Board shall be assumed by the Audit &Supervisory Board Member who has been determined in advance by a resolution at the meeting of the
Audit & Supervisory Board.

2.

The resolutions of the Audit & Supervisory Board shall be adopted at its meeting by a majority of the
Audit & Supervisory Board Members.

3.

The following matters may be unanimously resolved at the meeting of the Audit & Supervisory Board
instead of the consent of all the Audit & Supervisory Board Members:(1) Dismissal of the Accounting Auditor(s) in accordance with Article 340 of the Companies Act;
(2) Consent to a submission, by Member(s) of the Board of Directors, of the agenda at the General
Meeting of Shareholders or the meeting of the Board of Directors concerning the exemption ofMember(s) of the Board of Directors from their liabilities (including any amendment to the Articles ofIncorporation for such purpose) in accordance with Articles 425 to 427 of the Companies Act; and(3) Consent to the participation of the Corporation in litigations as to the pursuit of liabilities of theMember(s) of the Board of Directors, etc. in order to support the Member(s) of the Board of Directors
in such litigations in accordance with Paragraph 2 of Article 849 of the Companies Act.

Article 5. (Matters to be Resolved)
1.

The following matters shall be subject to the resolution at the meeting of the Audit & Supervisory Board:(1) Matters so provided for by laws or ordinances;(2) Matters so provided for in the Articles of Incorporation; and(3) Other important matters pertaining to the execution of their duties by the Audit & Supervisory Board
Members.

Article 6. (Matters to be Reported)
1.

The Audit & Supervisory Board Members shall make reports at the meeting of the Audit & Supervisory
Board on the following matters:(1) Matters so provided for by laws or ordinances; and(2) Other matters the Audit & Supervisory Board may deem necessary.

2.

The Member(s) of the Board of Directors and/or the Accounting Auditor(s) shall report matters so provided
for by laws or ordinances to the Audit & Supervisory Board.

3.

Notwithstanding the provisions of the preceding two (2) paragraphs, in case that the Audit & Supervisory
Board Member(s), the Member(s) of the Board of Directors or the Accounting Auditor(s) notifies all the
Audit & Supervisory Board Members of the matter(s), such matter(s) shall not be required to be reported at
the meeting of the Audit & Supervisory Board.

Article 7. (Audit Report)
1.

Pursuant to laws or ordinances, the Audit & Supervisory Board shall make an audit report upon deliberation
based on the audit reports prepared by each Audit & Supervisory Board Member.

2.

Any Audit & Supervisory Board Member may make note of his/her opinion in the audit report prepared by
the Audit & Supervisory Board if the details of his/her audit report differ from those of the Audit &Supervisory Board referred to in the preceding paragraph.

Article 8. (Minutes)
1.

Pursuant to laws or ordinances, the minutes shall be prepared each time a meeting of the Audit &Supervisory Board is held.

2.

With regards to the matters not required to be reported at the meeting of the Audit & Supervisory Board
pursuant to Paragraph 3 of Article 6 hereof, such Audit & Supervisory Board Member as separately
determined shall prepare the minutes thereon in accordance with laws or ordinances.

Supplementary Provisions
Article 1. (Effective Date)
These Regulations shall become effective as of August 29, 2011.
Article 2. (Amendment to these Regulations)
Any amendment to these Regulations shall be made by a resolution of the Audit & Supervisory Board.

MATTERS TO BE SUBMITTED TO
THE AUDIT & SUPERVISORY BOARD
Note:

1.

The Act: the Companies Act
The Enforcement Regulations: the Enforcement Regulations of the Companies Act
The Accounting Regulations: the Corporation Accounting Regulations

Matters to be resolved (Matters in relation to Article 5 of the Regulations of the Audit & Supervisory Board)(1) Matters provided for in laws or ordinances
Items

Relevant Articles of Applicable Law(1) Principles and execution plan of auditing

Article 390 (2)(c) of the Act(2) Request for reports on the execution of theduties of the Audit & Supervisory Board
Member(s) to the Audit & Supervisory Board

Article 390 (4) of the Act(3) Consent to the following actions taken by
Members of the Board of Directors(i)

Submitting proposed resolution concerning
the appointment of an Audit & Supervisory
Board Member or a substitute Audit &Supervisory Board Member to a general
meeting of shareholders

Articles 343 (1) and (3), and 329 (2) of the Act(ii) Submitting proposed resolution concerning
the appointment of an Accounting Auditor
to a general meeting of shareholders

Article 344 (1)(a) of the Act(iii) Making the dismissal of an Accounting
Auditor the agenda of a general meeting ofshareholders

Article 344 (1)(b) of the Act(iv) Making the non-reappointment of an
Accounting Auditor the agenda of a general
meeting of shareholders

Article 344 (1)(c) of the Act(v) Deciding the remuneration, etc. of an
Accounting Auditor or a person who is
temporarily acting as an Accounting
Auditor

Article 399 (1) and (2) of the Act(4) Request for Members of the Board of Directors
to take the following actions(i)

Making the appointment of an Audit &Supervisory Board Member or a substitute
Audit & Supervisory Board Member theagenda of a general meeting ofshareholders

Article 343 (2) and (3) of the Act(ii) Submitting proposed resolution concerning
the appointment of an Audit & Supervisory
Board Member or a substitute Audit &Supervisory Board Member to a general
meeting of shareholders

Article 343 (2) and (3) of the Act

ItemsRelevant Articles of Applicable Law(iii) Submitting proposed resolution concerning
the appointment of an Accounting Auditor
to a general meeting of shareholders

Article 344 (2)(a) of the Act(iv) Making the appointment or the dismissal ofan Accounting Auditor the agenda of ageneral meeting of shareholders

Article 344 (2)(b) of the Act(v) Making the non-reappointment of an
Accounting Auditor the agenda of a general
meeting of shareholders

Article 344 (2)(c) of the Act(5) Election of an Audit & Supervisory Board
Member to be in charge of reporting thedismissals of any Accounting Auditors to a
general meeting of shareholders

Article 340 (3) and (4) of the Act(6) Appointment and dismissal of any person who is
to temporarily act as an Accounting Auditor

Article 346 (4), (5) and (6) of the Act(7) Election and dismissal of a full-time Audit &Supervisory Board Member

Article 390 (2)(b) of the Act(8) Election and dismissal of a Specific Audit &Supervisory
Board
Member(Tokuteikansayaku)

Article 132 (5)(b)(i) of the Enforcement
Regulations, Article 130 (5)(b)(i) of the
Accounting Regulations(2) Matters provided for in the Articles of Incorporation
Items(1) Amendment to the Regulations of the Audit &Supervisory Board

Relevant Articles of the Articles of Incorporation

Article 26 (3) of the Articles of Incorporation(3) Other important matters pertaining to execution of the duties of Audit & Supervisory Board Member
Items(1) Election of a Chairman at the meeting of the Audit & Supervisory Board(2) Election of a person authorized to convene the meeting of the Audit & Supervisory Board(3) Election of the Audit & Supervisory Board Member to be in charge of giving prior consent to thechanges of the organization and personnel matters in the Audit & Supervisory Board Office(4) Prior approval of auditing services and non-audit services pursuant to Section 202 of SarbanesOxley Act(5) Election of the Audit & Supervisory Board Member to be in charge of giving approval on theamendment with respect to auditing services and non-audit services pursuant to Section 202 of
Sarbanes-Oxley Act(6) Other significant matters with respect to the execution of the duties of the Audit & Supervisory
Board Member

2.

Matters to be reported (Matters in relation to Article 6 of the Regulations of the Audit & Supervisory Board)(1) Matters provided for by laws or ordinances
Items

Relevant Articles of Applicable Law(1) Matters to be reported by Audit & Supervisory
Board Members• Execution of the duties of Audit &Supervisory Board Members

Article 390 (4) of the Act(2) Matters to be reported by Members of the Boardof Directors• Any facts which may cause serious damage
to the Corporation

Article 357 (1) and (2) of the Act(3) Matters to be reported by Accounting Auditors• Unjust acts or material facts in violation oflaws, ordinances or the Articles ofIncorporation in relation to the execution of
the duties of Members of the Board of
Directors

Article 397 (1) and (3) of the Act(2) Other matters deemed necessary by the Audit & Supervisory Board

Exhibit 2.1(TRANSLATION)SHARE HANDLING REGULATIONSOFTOYOTA MOTOR CORPORATION
Established: November 28, 1951
As last amended on June 16, 2015
CHAPTER I.
GENERAL PROVISIONS
Article 1. (Purpose)
1.

Matters relating to the handling of shares and stock acquisition rights (including the procedures relating to
the exercise of shareholders’ rights) of Toyota Motor Corporation (the “Company”) under the Articles ofIncorporation of the Company, shall be governed by provisions of these share handling regulations (these“Regulations”), in addition to the provisions set forth by Japan Securities Depositary Center, Inc.
(“JASDEC”), the book-entry transfer institution, and account management institutions such as securities
companies and trust banks (each referred to as the “Securities Company”).

2.

Matters relating to the handling of special accounts opened in accordance with agreements executed
between the Company and a trust bank designated by the Company, and the fees in connection with suchspecial accounts shall be governed by these Regulations, in addition to the provisions set forth by the trustbank.

Article 2. (Transfer Agent and its Handling Office)The transfer agent (the “Transfer Agent”) of the Company and its handling office shall be as follows:
Transfer Agent:
Mitsubishi UFJ Trust and Banking Corporation
4-5, Marunouchi 1-chome, Chiyoda-ku, Tokyo
Handling office:Mitsubishi UFJ Trust and Banking Corporation,
Corporate Agency Division
4-5, Marunouchi 1-chome, Chiyoda-ku, Tokyo
Article 3. (Request or Notification)
1.

Any request or notification with respect to the matters provided for in these Regulations shall be made in a
written format designated by the Company. However, the foregoing shall not apply if such request or
notification is submitted through the Securities Company and JASDEC, or as provided for in Article 32,
Paragraph 1.

2.

Should any request or notification as set forth in the preceding paragraph be submitted by the shareholder
through the Securities Company and JASDEC, or through the Securities Company, it may be deemed thatsuch request or notification has been made by such shareholder.

3.

The Company may request the person who submitted the request or notification as stipulated in Paragraph 1of this article to the Company, to submit materials certifying that the person is a shareholder of theCompany or an agent of a shareholder of the Company.

4.

In the event that the Company requests a person to submit materials as described in the preceding paragraph,
the Company shall not process such request or notification unless such material is submitted.

Article 4. (Agent)
Should the procedure mentioned in Paragraph 1 of the preceding article be taken by an agent, such agent shallsubmit a documentation evidencing his/her power of representation. In addition, if the consent of curator or
assistant is required for the procedure mentioned in Paragraph 1 of the preceding article, the shareholder shallsubmit a documentation evidencing such consent.
Article 5. (Certification Document and Guarantor)
If the Company deems it necessary in connection with the procedure mentioned in Article 3, Paragraph 1, theCompany may require, in addition to those provided for in these Regulations, such certification document or suchguarantor as the Company may deem appropriate.

CHAPTER II.
ENTRY OR RECORDING, ETC. IN THE REGISTER OF SHAREHOLDERS
Article 6. (Entry or Recording in the Register of Shareholders)
1.

The Company shall enter or record items in the register of shareholders (the “Register of Shareholders”) in
accordance with the general shareholders notification (sou kabunushi tsuchi) received from JASDEC.

2.

If the Company receives notification regarding changes in address or other matters indicated in the Registerof Shareholders of a person who is entered or recorded in the Register of Shareholders (the “Shareholder”),
the Company shall revise the Register of Shareholders in accordance with such notification.

3.

In addition to Paragraphs 1 and 2 of this article, the Company shall enter or record, in the Register of
Shareholders, the issuance of new shares and such other matters provided for in laws and regulations.

Article 7. (Letters, Symbols, etc. to be Used in the Register of Shareholders)
Entries in the Register of Shareholders shall be made using the letters and symbols specified by JASDEC.

CHAPTER III.
NOTIFICATION OF VARIOUS MATTERS
Article 8. (Notification of Shareholder’s Name/Corporate Name and Address, etc.)
1.

A Shareholder shall file a notification of name/corporate name and address; provided, however, that if anyof the following items is applicable to the Shareholder, notification of the matters specified in such item
shall be filed:(1) If the Shareholder has a statutory agent such as a person in parental authority or guardian, the name/corporate name and address of such statutory agent.
(2) If the Shareholder is a corporation, the corporate name and address of the judicial person, and the title
and name of its representative.
(3) If the shares are jointly owned, the name/corporate name and address of a representative of the joint
owners.
(4) If the Shareholder resides outside of Japan, in addition to the name/corporate name and address of the
Shareholder, the address in Japan at which such Shareholder shall receive notices or, if the Shareholder
appoints a standing proxy in Japan, the name/corporate name and address of such standing proxy.

2.

A Shareholder shall file a notification of amendment, if there is any amendment to the matters mentioned in
Paragraph 1 of this article.

3.

The notifications or notifications of amendment described in Paragraphs 1 and 2 of this article shall be filed
through the Securities Company and JASDEC. However, this shall not apply to the cases stipulated in
Article 6, Paragraph 3.

Article 9. (Other Notifications)1.

In addition to notifications set forth in the preceding article, a Shareholder submitting any notification to theCompany shall do so through the Securities Company and JASDEC, or through the Securities Company,
unless otherwise designated by the Company. However, this shall not apply to the cases stipulated in
Article 6, Paragraph 3.

2.

Notifications which cannot be received or handled by the Securities Company shall be submitted to theTransfer Agent.

Article 10. (Application to Registered Pledgees)
The provisions in this Chapter shall be applied mutatis mutandis to registered pledgees of shares.

CHAPTER IV.
PURCHASE OF COMMON SHARES CONSTITUTING LESS THAN ONE UNIT
Article 11. (Request for Purchase of Shares)
In the event that a shareholder requests the Company for the purchase of common shares constituting less than
one unit, such shareholder shall submit the request through the Securities Company and JASDEC in accordancewith the provisions set forth by JASDEC.
Article 12. (Determination of Purchase Price)
If a purchase request is made for common shares constituting less than one unit, the purchase price of such sharesshall be the amount obtained by multiplying the number of common shares requested to be purchased by theamount equivalent to the closing price of the common shares of the Company on the Tokyo Stock Exchange on
the date on which the purchase request is received at the Handling Office of the Transfer Agent (“Date ofRequest”); provided, however, that if there is no sale and purchase transaction on the Tokyo Stock Exchange on
the Date of Request or if the Date of Request falls on a holiday of the Tokyo Stock Exchange, the amountequivalent to the price at which the common shares of the Company are first traded on the trading day
immediately following such date and thereafter shall be used.
Article 13. (Payment of Purchase Price)
Unless otherwise specified by the Company, the purchase price under the preceding article shall be paid by theCompany to the applicant on the fourth business day of the Transfer Agent from the date immediately following
the date on which the purchase price is determined and the purchase request is received at the Handling Office of
the Transfer Agent.
Article 14. (Transfer of Shares Purchased)
The common shares constituting less than one unit for which the request for purchase is made shall be transferredto the transfer account of the Company on the date on which procedures for the payment of the purchase price as
set forth in the preceding article have been completed.

CHAPTER V.
ENTRY OR RECORDING, ETC. IN REGISTER OF STOCK ACQUISITION RIGHTS
Article 15. (Entry or Recording, etc. in Register of Stock Acquisition Rights)
1.

Any request for (i) entry or recording in the register of the stock acquisition rights (the “Register of theStock Acquisition Rights”), (ii) registration, transfer or cancellation of the right of the pledge in connection
with the stock acquisition rights and (iii) representation or cancellation of the trust assets, shall be made to
the Transfer Agent.

2.

In addition to the provisions set forth in the preceding paragraph, the handling of stock acquisition rights
may be governed separately.

Article 16. (Matters and Methods of Notifications Required to the Holder of Stock Acquisition Rights)
The provisions in Articles 8 and 9 of these Regulations regarding matters and methods of notifications required
shall be applied mutatis mutandis to the holders of the stock acquisition rights that are entered or recorded in theRegister of the Stock Acquisition Rights; provided, however, unless as otherwise governed pursuant toParagraph 2 of the preceding article, such notifications shall be made to the Transfer Agent.

CHAPTER VI.
MODEL AA CLASS SHARESArticle 17. (Exceptions for Model AA Class Shares)
1.

With respect to matters concerning the Model AA Class Shares, notwithstanding any other provisions
hereof, the provisions of this Chapter shall prevail and apply.

2.

All request or notification procedures, or any other handling, concerning the Model AA Class Shares shallbe made to the Transfer Agent, unless otherwise provided for in this Chapter.

Article 18. (Approval Procedures for Transfer)
Approval procedures for transfer of the Model AA Class Shares shall be processed through the Transfer Agent.
Article 19. (Entry or Recording in Register of Shareholders of Model AA Class Shares)
1.

In case of a request for entry or recording in the Register of Shareholders of the Model AA Class Shares(hereinafter referred to as the “Registration of Transfer”), a holder of Model AA Class Shares who wasentered or recorded in the Register of Shareholders (the “Model AA Class Shareholder”) and a person who
acquired the Model AA Class Shares shall jointly submit a request by prescribed written form with thenames and seals of both.

2.

In case a request for the Registration of Transfer is made with respect to the Model AA Class Sharesacquired due to inheritance, merger or any other event other than assignment, a written request therefor shallbe submitted together with a document evidencing the cause for such acquisition.

Article 20. (Notifications of Holders, Etc. of Model AA Class Shares)
1.

The Model AA Class Shareholders and the registered pledgees of the Model AA Class Shares, or theirstatutory agents, in addition to the notification set forth in Article 8 hereof, shall notify the Company of theirseal impressions; provided, however, that foreigners may substitute their specimen signatures for seal
impressions.

2.

In case of a change in the matters notified pursuant to the preceding paragraph, such change shall be
notified.

3.

All requests, notifications or any other exercises of shareholders’ rights concerning the Model AA Class
Shares to the Company shall be made in the form prescribed by the Company, bearing the seal impressions
notified pursuant to the provisions of Paragraph 1 of this article.

Article 21. (Request for Purchase of Model AA Class Shares)
In the event that a shareholder requests the Company for the purchase of Model AA Class Shares constituting
less than one unit, such shareholder shall submit the request through the Transfer Agent by prescribed written
form, etc.
Article 22. (Determination of Purchase Price)1.

If a purchase request is made for Model AA Class Shares constituting less than one unit, the purchase priceof such shares shall be the amount prescribed through discussions between the Company and theshareholder of Model AA Class Shares constituting less than one unit who made the demand.

2.

During the discussion mentioned in the preceding paragraph, the Company in principle shall make an offer
to buy such shares for its market value calculated by the securities company which subscribed for suchshares as of the date on which the purchase request is received.

3.

In the case described in Paragraph 1 of this article, the Company or the shareholder of Model AA Class
Shares constituting less than one unit who made the demand pursuant to the provisions of the precedingarticle may file a petition for the court to determine the purchase price within twenty days from the day
when such demand is made.

4.

Notwithstanding the provisions of Paragraph 1 of this article, if petition is filed pursuant to the preceding
paragraph within the period provided for in that paragraph, the amount determined by the court in response
to such petition shall be the purchase price of such Model AA Class Shares constituting less than one unit.

5.

Notwithstanding the provisions of Paragraph 1 of this article, in the case described in that paragraph, if nopetition is filed under Paragraph 3 of this article within the period provided for in that paragraph (except incases where the discussions under Paragraph 1 of this article are successfully concluded within such period),the purchase price of the Model AA Class Shares constituting less than one unit shall be the amountobtained by multiplying the amount of the net assets per share by the number of the Model AA Class Sharesconstituting less than one unit related to the demand pursuant to the provisions of the preceding article.

Article 23. (Payment of Purchase Price)
Unless otherwise specified by the Company, the purchase price under the preceding article shall be paid by theCompany to the applicant within six business days of the Transfer Agent from the date immediately following
the date on which the purchase price is determined.
Article 24. (Registration of Transfer in Case of Special Procedures Required by Laws and Regulations)
If any special procedure is required by laws and regulations in connection with transfer of the Model AA Class
Shares, a document evidencing the completion of such procedure shall be submitted together with a written
request for the transfer.
Article 25. (Registration of Pledges, Transfer or Cancellation Thereof)
In case of a request for the registration of pledges on the Model AA Class Shares, or transfer or cancellation
thereof, a written request therefor with the names and seals of both the pledgor and the pledgee affixed thereto
shall be submitted.

Article 26. (Recordation of Shares Held in Trust or Cancellation Thereof)
In case of a request for the recordation of the Model AA Class Shares held in trust or cancellation thereof, awritten request therefor shall be submitted either by the trustor or the trustee.
Article 27. (Method for Request for Conversion of Model AA Class Shares)
1.

In case of a request to the Company for acquisition of First Series through Fifth Series Model AA Class
Shares in exchange for common shares of the Company in the number as calculated by the formula set forthin Article 17 of the Articles of Incorporation, such request shall be made in the prescribed form, and atransfer account (other than a special account) which has been opened for himself/herself for the purpose of
the transfer of such common shares shall be designated.

2.

The request provided for in the preceding paragraph may not be cancelled after such request is received at
the Handling Office of the Transfer Agent.

3.

The delivery of the common shares set forth in Paragraph 1 of this article shall be made by a notification of
new record or an application for the transfer of such common shares to the transfer account designatedpursuant to the provisions of such paragraph.

Article 28. (Method for Request for Acquisition of Model AA Class Shares)
In case of a request to the Company for acquisition of First Series through Fifth Series Model AA Class Shares inexchange for cash in an amount as calculated by the formula set forth in Article 18 of the Articles ofIncorporation, such request shall be made in the prescribed form.
Article 29. (Effect of Request for Conversion and Acquisition of Model AA Class Shares)
The requests set forth in the preceding two articles shall come into effect when each request is received at the
Handling Office of the Transfer Agent set forth in Article 2.
Article 30. (Notice or Public Notice of Adjustment of Base Price and Number of Common Shares delivered toModel AA Class Shareholders)
In case the Base Price provided for in Article 14 of the Articles of Incorporation and number of common shares
to be acquired by Model AA Class Shareholders in exchange for one Model AA Class Share provided for in
Article 17 of the Articles of Incorporation shall be adjusted, details of such adjustment and the number of thecommon shares to be delivered in exchange for acquisition of Model AA Class Shares shall be notified or
notified publicly to the Model AA Class Shareholders by the day preceding the day on which such adjusted BasePrice or number of common shares shall be applied (hereinafter referred to as the “Adjustment Date”); provided,
however, that in case the Company is not able to give notices or public notices of such change to the ModelAA Class Shareholders by the day preceding the Adjustment Date, the Company shall give notices or public
notices of such change to the Model AA Class Shareholders promptly after the Adjustment Date.
Article 31. (Procedures for Acquisition pursuant to Provisions of Acquisition of Model AA Class Shares)
In case of acquisition of Model AA Class Shares set forth in Article 19 of the Articles of Incorporation, theCompany shall give notices or public notices of the amount of cash to be delivered to the Model AA Class
Shareholders in exchange for the acquisition of one share of such Model AA Class Shares and any othernecessary matters to the Model AA Class Shareholders.

CHAPTER VII.
PROCEDURES FOR EXERCISE OF MINORITY SHAREHOLDERS’ RIGHTS, ETC.
Article 32. (Procedures for Exercise of Minority Shareholders’ Rights, etc.)
1.

Where minority shareholders’ rights and other rights as provided for in Article 147, Paragraph 4 of the Law
Concerning Book-entry Transfer of Corporate Bonds, Stocks, etc. (the “Transfer Law”) are exercised
directly to the Company, the exercising shareholder shall submit the request in writing bearing the name andseal of the shareholder, with an acceptance form (uketsuke hyou) of an Individual Shareholder Notice(kobetsu kabunushi tsuchi) (a notification set forth in Article 154, Paragraph 3 of the Transfer Law)
delivered by the Securities Company attached. Non-Japanese citizens may provide a signature as a substitutefor the name and seal.

2.

Notwithstanding the provisions of the preceding paragraph, in case of exercise of the minority shareholders’rights, etc. by the Model AA Class Shareholders, the request for the Individual Shareholder Notice (kobetsu
kabunushi tsuchi) shall not be required.

3.

The provisions in Article 3, Paragraphs 3 and 4, Articles 4 and 5 shall be applied to the exercise of minority
shareholders’ rights and other rights as described in Paragraphs 1 and 2 of this article.

CHAPTER VIII.
FEES
Article 33. (Fees)
The fees for the handling of shares shall be free of charge; provided, however, that the fees payable byshareholders to the Securities Company or JASDEC shall be borne by the Shareholders.

SUPPLEMENTARY PROVISIONS
Article 1. (Amendment to Regulations)
Any amendment to these Regulations shall be made by a resolution of the meetings of the Board of Directors of
the Company.
Article 2. (Effective Date)
These Regulations, as amended, shall become effective as of June 16, 2015.
(End of Document)Exhibit 11.1
The Code of Ethics for Members of the Board of Directors, Senior Managing
Officers and Managing Officers
Article 1. (Purpose)
This document comprises a code of ethics (the “Code”) for members of the board of directors, senior
managing officers and managing officers (the “Officers”) of Toyota Motor Corporation (the “Company”) thatsets forth the basic rules that, in addition to those outlined in “Guiding Principles at Toyota,” “Toyota Code of
Conduct” and other guidelines and internal regulations of the Company, each Officer shall comply with in theperformance of their professional management duties.
Article 2. (Objective)
This Code seeks to ensure honest and ethical conduct by all Officers, as well as their compliance withapplicable laws and regulations.
Article 3. (Scope of Application)
This Code shall be applicable to all Officers.
Article 4. (Disclosure of this Code of Ethics)
This Code shall be appropriately disclosed in accordance with applicable laws and regulations.
Article 5. (Honest and Ethical Conduct)
1.

Each Officer shall act honestly and ethically in the course of any business activity of the Company.

2.

No Officer may engage in or otherwise enter into any act or transaction that gives rise to an actual or
potential conflict of interest between such Officer and the Company without first reporting such matterto the Board of Directors and obtaining prior approval therefrom in accordance with the applicableprovisions of the Japanese Companies Act and the internal regulations of the Company. Such Officer
may not participate in the determination of the Board of Directors resolution relating to the granting ofsuch approval.

Article 6. (Ensuring Fairness and Accuracy of Financial Disclosure; Appropriate Disclosure)1.

The chairman of the board of directors, president and member of the board of directors, accounting andfinancial officers and persons performing similar functions shall be responsible for ensuring that
documents submitted to applicable governmental authorities and other information made public by theCompany with respect to the Company’s financial position and financial statements are fair and readily
comprehensible in content and the method of presentation, and that such documents and information
are timely disclosed.

2.

The chairman of the board of directors, president and member of the board of directors, accounting andfinancial officers and persons performing similar functions shall be responsible for establishing andmaintaining disclosure controls and internal controls for documents and information specified in theprevious paragraph.

3.

In connection with the preparation of the Company’s financial statements, an Officer may not act in a
way that may cause a material misunderstanding to or otherwise materially mislead any employee or
independent public accountant involved in the preparation of such financial statements.

Article 7. (Compliance with Laws and Regulations)
The Officers shall comply with all applicable laws, rules and regulations, including those related to theprohibition of insider trading, in each of the countries and regions in which the Company operates.

Article 8. (Reporting of Unlawful Acts and Unethical Conduct)
1.

Each Officer shall promptly report to the Board of Directors, Representative Director, Disclosure
Committee, CSR Committee, or other responsible division or person appointed by these committees, inthe event that such Officer or other Officers have acted in violation of the applicable laws or ethics.

2.

Officers may contact the “Compliance Hotline” set up by the Company at an outside law firm with any
legal or ethical inquiries or to report any breach of applicable laws or ethics. Upon receiving suchreport or other such inquiry, the designated law firm shall conduct necessary investigations and provide
a report or recommendation to the Company while ensuring the anonymity of the person making such acontact. The Company shall then take appropriate measures based on such report or recommendation.

Article 9. (Accountability for Adherence to the Code)1.

Each Officer recognizes that legal compliance and ethical conduct form the basis for all corporate
activities, and is obligated to comply with this Code.

2.

The Company shall take appropriate disciplinary action in accordance with applicable laws and internal
regulations of the Company against any Officer who acts in violation of the Code.

3.

Officers who are subject to disciplinary action pursuant to the previous paragraph may not participate
in any meeting, relating to the determination of such disciplinary action, of the Board of Directors,
Disclosure Committee, CSR Committee, or other investigative committees appointed thereby.

Article 10. (Exemption)
An exemption from the Code shall only be granted pursuant to a resolution of the Board of Directors, andany such exemption shall be appropriately disclosed in accordance with applicable laws.
Article 11. (Amendment)
1.

Any amendment of this Code shall only be effected by a resolution of the Board of Directors.

2.

The CSR Committee shall be responsible for regularly evaluating the appropriateness of this Code, andfor making recommendations relating to any necessary amendments of the Code to the Board of
Directors.

Supplementary Provision
Article 1. (Effective Date)
This Code shall become effective on April 1, 2011.

Exhibit 12.1
CERTIFICATIONSI, Takeshi Uchiyamada, certify that:1.

I have reviewed this annual report on Form 20-F of Toyota Motor Corporation (the “Company”);

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit tostate a material fact necessary to make the statements made, in light of the circumstances under whichsuch statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements and other financial information included in thisreport fairly present in all material respects the financial condition, results of operations and cash flowsof the Company as of, and for, the periods presented in this report;

4.

The Company’s other certifying officer and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) andinternal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for
the Company and have:(a) Designed such disclosure controls and procedures, or caused such disclosure controls andprocedures to be designed under our supervision, to ensure that material information relating to
the Company, including its consolidated subsidiaries, is made known to us by others within thoseentities, particularly during the period in which this report is being prepared;(b) Designed such internal control over financial reporting, or caused such internal control overfinancial reporting to be designed under our supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;(c) Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented inthis report our conclusions about the effectiveness of the disclosure controls and procedures, as ofthe end of the period covered by this report based on such evaluation; and(d) Disclosed in this report any change in the Company’s internal control over financial reporting that
occurred during the period covered by the annual report that has materially affected, or isreasonably likely to materially affect, the Company’s internal control over financial reporting; and5.

The Company’s other certifying officer and I have disclosed, based on our most recent evaluation ofinternal control over financial reporting, to the Company’s auditors and the Audit & Supervisory Board(or persons performing the equivalent functions):(a) All significant deficiencies and material weaknesses in the design or operation of internal control
over financial reporting which are reasonably likely to adversely affect the Company’s ability torecord, process, summarize and report financial information; and(b) Any fraud, whether or not material, that involves management or other employees who have asignificant role in the Company’s internal control over financial reporting.

Date: June 24, 2015
/S/

TAKESHI UCHIYAMADA

Takeshi Uchiyamada
Chairman of the Board of Directors
Toyota Motor Corporation

CERTIFICATIONSI, Takahiko Ijichi, certify that:1.

I have reviewed this annual report on Form 20-F of Toyota Motor Corporation (the “Company”);

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit tostate a material fact necessary to make the statements made, in light of the circumstances under whichsuch statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements and other financial information included in thisreport fairly present in all material respects the financial condition, results of operations and cash flowsof the Company as of, and for, the periods presented in this report;

4.

The Company’s other certifying officer and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) andinternal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for
the Company and have:(a) Designed such disclosure controls and procedures, or caused such disclosure controls andprocedures to be designed under our supervision, to ensure that material information relating to
the Company, including its consolidated subsidiaries, is made known to us by others within thoseentities, particularly during the period in which this report is being prepared;(b) Designed such internal control over financial reporting, or caused such internal control overfinancial reporting to be designed under our supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;(c) Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented inthis report our conclusions about the effectiveness of the disclosure controls and procedures, as ofthe end of the period covered by this report based on such evaluation; and(d) Disclosed in this report any change in the Company’s internal control over financial reporting that
occurred during the period covered by the annual report that has materially affected, or isreasonably likely to materially affect, the Company’s internal control over financial reporting; and5.

The Company’s other certifying officer and I have disclosed, based on our most recent evaluation ofinternal control over financial reporting, to the Company’s auditors and the Audit & Supervisory Board(or persons performing the equivalent functions):(a) All significant deficiencies and material weaknesses in the design or operation of internal control
over financial reporting which are reasonably likely to adversely affect the Company’s ability torecord, process, summarize and report financial information; and(b) Any fraud, whether or not material, that involves management or other employees who have asignificant role in the Company’s internal control over financial reporting.

Date: June 24, 2015
/S/

TAKAHIKO IJICHI

Takahiko Ijichi
Executive Vice President, Member of the Board
Toyota Motor Corporation

Exhibit 13.1
CERTIFICATION
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
each of the undersigned officers of Toyota Motor Corporation, a Japanese corporation (the “Company”), does
hereby certify that, to such officer’s knowledge:
1. The accompanying Annual Report of the Company on Form 20-F for the period ended March 31, 2015
(the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of1934; and2. Information contained in the Report fairly presents, in all material respects, the financial condition andresults of operations of the Company.

By:

/S/

TAKESHI UCHIYAMADA

Name:
Title:

Takeshi Uchiyamada
Chairman of the Board of Directors

Date: June 24, 2015

By:
Name:
Title:/S/

TAKAHIKO IJICHI

Takahiko Ijichi
Executive Vice President, Member of the Board

Date: June 24, 2015
(A signed original of this written statement required by Section 906 has been provided to Toyota Motor
Corporation and will be retained by Toyota Motor Corporation and furnished to the Securities and Exchange
Commission or its staff upon request.)

Exhibit 15.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in the Registration Statements on Form S-8(No. 333-125977, 333-107322, 333-143955, 333-160081 and 333-175377) of Toyota Motor Corporation of ourreport dated June 24, 2015 relating to the financial statements and the effectiveness of internal control overfinancial reporting, which appears in this Form 20-F.
/s/ PricewaterhouseCoopers Aarata
Nagoya, Japan
June 24, 2015