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Toyota Motor Corp. (NYSE: TM) continues to do well financially, as shown by its fiscal first-half figures, which cover the period ended September 30.

On a consolidated basis, net revenues for the first half of the fiscal year totaled 10.9 trillion yen, an increase of 36.1 percent compared to the same period last fiscal year. Operating income increased from a loss of 32.6 billion yen to 693.7 billion yen, an increase of 726.3 billion yen, while income before income taxes was 794.5 billion yen. Net income increased from 81.5 billion yen to 548.2 billion yen.

The most notable aspect of the numbers is that the trouble between China and Japan did not hurt Toyota sales enough to badly damage its earnings. Toyota did mention China as a challenge going forward, but management made encouraging comments about the balance of the year:

Although currency fluctuations have continued to affect our profits and the effect of current Japan-China relations on our sales is still unclear, we have revised the forecast we announced at the end of the first quarter to reflect the progress we have been making in our profit improvement activities. We intend to continue strengthening such activities and aim to create a profit structure able to withstand changes in the business environment.

Toyota has benefited from its limited exposure in Europe. However, the much larger factor in its success is that it has regained much of its market share in the United States. American sales for the Japanese company continue to rise more rapidly that any other large manufacturer that sells vehicles in the U.S., a sign that it has overcome supply constraints cause by the Japanese earthquake, as well as reputation issues created by a series of large recalls.

G-20 Concerns

Media reports from the Group of 20 summit indicate that two issues have dominated the meeting — the effects of the U.S. fiscal cliff and Europe’s troubled economy and financial situations. No one in attendance who has been willing to talk to the press has any sense of optimism that pressing the United States and Europe will yield positive results. Each one is mired in bickering among its leaders, and that bickering is months if not years old. The Economic Times reports:

“If the United States fails to resolve the fiscal cliff it would hit the US economy hard as well as the world and the Japanese economy, so each G20 country will urge the United States to firmly deal with it,” Bank of Japan Governor Masaaki Shirakawa said before a meeting of Group of 20 finance ministers and central bankers.

If wishes were horses, all the beggars would ride.

Falling Fuel Prices

Despite concerns that Hurricane Sandy might have hurt gasoline supplies and closed some refineries, gas prices continue to fall, and fall rapidly. According to AAA Fuel Gauge data, the national average cost of a gallon of regular came to $3.470. That was down from $3.543 a week ago and from $3.806 a month ago. Prices have fallen so quickly that only Alaska and Hawaii have average regular prices higher than $4. A month ago, several large states, including California, were above that threshold. The price drop could not come at a better time. Economic growth faces the reaction of individual consumers and businesses to the so-called fiscal cliff. Most experts believe the reaction will be negative enough to drag on gross domestic product. The Congressional Budget Office has even forecast that gross domestic product could drop early in the year. Any factor that might mitigate a rise in taxes and a decline in government spending might provide just enough stimulus to keep the economy’s head above water, if only by a little.

Douglas A. McIntyre