Toyota Forecasts 28% Profits Drop
The New York Times reports that Toyota reports (and we report their reporters reporting the report) that Toyota's profits sank by 28 percent. "For the year to March 31, 2009, the Japanese automaker forecasts net profit to fall 27.2 percent to 1.25 trillion and operating profit to decline yen 29.5 percent to 1.60 trillion yen, breaking a seven-year string of record results." That's a whole lot of yen. And make no mistake: ToMoCo is hurting. Stateside sales of the new Texas Tundra are up 24.8 percent year-to-date– but that's an increase of fewer than 7k units. And despite several hot-selling products, overall U.S. sales are down 3.3 percent (789,447). This after Toyota put the pedal to the metal on production, building big-ass factories worldwide. Equally painful in that "be careful what you wish for" kinda way, worldwide market growth has sent commodity prices through the [optional sun] roof. Not to mention the fact that all that Detroit-sourced kvetching about Japanese currency manipulation has proven to be so untrue it literally hurts (the dollar's down 10 percent on the yen). Still, these guys are strong enough to weather the storm. The Times concludes by pointing out that Toyota is still valued at about $180b, and compares that to Daimler and VW combined. We'd like to point out that Yahoo!Finance puts GM's "enterprise value" at $32.94b.
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I don't have any real brand loyalty. I've owned an Accord and hated it, being the most unfun vehicle I've ever owned. I've had an Avalon. Again, nice car, boring. I've had/have a Wrangler, a Ranger, Grand Cherokees, a Liberty, a Ram, a Mustang, a Pathfinder. I currently have an FX35. Nice car, yet so many "minor" issues with it like paint peeling or small rust spots or a cd player that no longer plays burned cd's that it too is becoming unfun. Basically, I've had just as many issues with imports as I've had with domestics, so I can hate them all equally. However, I recognize that the decisions a car manufacturer makes don't actually take affect until years later. It's even longer before the general population starts to buy into those ideas. Toyota is a great company who builds great (albeit nothing I get really enthusiastic about) cars. However, Ford and GM have made some strides to turn things around. On the flip side, Toyota has made some mistakes as well (rushing the Tundra to market and having the reliability issues that come along with that rush, for example). Putting things in perspective, Toyota has made an incredible run at GM to unseat them as the top car manufacturer. GM has been in that seat for a long time, all the while building a bunch of cars and trucks that many perceive as inferior to Toyota. It'll be interesting to see if Toyota can maintain that momentum. We're seeing signs of it slowing already. In the end, the increased competition is good for all of us consumers. Sometimes I think the TTAC community is a little heavy on the anti domestic bias.
troonbop: I’ve often THOUGHT we should drown dimwitted stiffs that use too many capitals and are envious of anyone with an education. Hmmm...must have an MBA here. Look, sorry to hurt your feelings but I need to point out that in fact I have two degrees, Philosophy and Religious Studies. I know, I know...nothing to really brag about or make money with. But it does help a LITTLE. I also am a VP running a wonderful manufacturing company with my brothers with a brand well known throughout the world as the best. And, we are all very pround that we have never hired an MBA.We have never hired anyone without the passion and the knowledge and love of our industry. And, I am really, REALLY sorry for all the capitals.
Interesting info from Toyota's conference call. It's about their production capacity. At the end of the call they list Toyota's production capacity in each region, as follows: US+Canada 2.02M Europe 805K Africa 200K Australia 100K Asia, incl China 1.768M South America 151K Global total outside Japan: 4.9M Japan 3.8M Global total for Toyota: 8.7M for Toyota These numbers exclude Daihatsu and Hino. In Japan Toyota, Daihatsu and Hino produced 5.1M in the past year. Add this to the 4.9M production capacity outside Japan and you get: 10M. In addition Daihatsu just opened a new factory in Japan and several more Toyota factories are coming online soon. If I've understood this all correctly, Toyota already exceeds 10M and is closing in on 11M worldwide production capacity. That's a lot!