Toyota Shares Surge Following Reported Plans to Boost Return on Equity

The auto giant aims to double its return on equity target, as Honda and Nissan pursue a merger to address industry challenges.

Toyota's U.S.-traded shares rose over 8% after reports suggested the company plans to increase its return on equity (ROE) target to 20%.
The company has not set an explicit deadline for achieving the ROE target, according to a spokesperson, despite reports citing an unnamed executive.
Analysts suggest the move could enhance Toyota's global competitiveness and shareholder returns through improved capital efficiency.
Honda and Nissan confirmed merger talks earlier this week, potentially creating the world's third-largest automaker by annual sales.
The merger is seen as a response to intensifying competition from Chinese and Korean EV makers, as well as rising costs for electrification and autonomous vehicle development.