Toyota In No Danger of Bankruptcy Whatsoever

Robert Farago
by Robert Farago
toyota in no danger of bankruptcy whatsoever

I find the whole “TTAC is pro-Toyota” meme a little strange. Have a look at our coverage of their greenwashing or our reviews of their automobiles (including our excoriation of various Scion). Yes, The Big 2.8 get ten times the coverage afforded the transplants. But we’re an American-based website, and the Motown meltdown is the biggest story in the history of American automaking. Yes, our Bertel Schmitt recently wrote a compare and contrast blog, pointing out the differences between Toyota’s response to the auto industry meltdown with GM’s. But it’s the truth dammit, and that’s the business we’re in. Feel free to discuss TTAC’s “perception gap” below. Meanwhile, I want to point out that Autoblog’s recent “discovery” [via their BFF at AutoLine] that Toyota has “only” $18.5b worth of cash, supposedly placing them in the same boat as, say, GM, is wildly disingenuous.

Toyota is burning cash, but they have had positive earnings for decades. They have little debt, assets aplenty and they can borrow tens of billions if needs be.

Toyota has the strength, ingenuity, flexibility and the firm grasp on reality needed to survive both their own mistakes and the violent contraction of the global automobile business. Is there anyone who doubts it? If they do, they either have an axe to grind or badly flawed analytical abilities. And that’s the truth.

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4 of 33 comments
  • Jeffer Jeffer on Jan 28, 2009

    TTAC pro-Toyota? Rubbish! Actually some of the reviews of ToMoCo products leave me with the opposite feeling, no offense intended to anyone, this site being about the truth and all.Disclaimer: my daily driver is decade old Toyota. I also have an Olds Toronado for weekends and an F-150 workhorse.(No Bias here!)

  • Gm-uawtool Gm-uawtool on Jan 28, 2009

    Let's look at Toyota's situation from another angle. Toyota says it will lose $1.7 billion for the fiscal year - doesn't seem too onerous until you consider what they made the first two quarters of their fiscal year (these numbers are straight from Toyota's website). First quarter operating income was 412.5 billion yen, or $3.8 billion at the exchange rate quoted for Aug. 5. Second quarter was 582 billion yen, or $5.9 billion at the exchange rate of Nov. 7. This means that in the process of wiping out those profits and adding another $1.7 billion, Toyota will lose around.......$11.4 billion for the November through March period. Folks, those are losses that rival Detroit's, if not surpasses them. And a 1.4 million car recall can't be helping matters any. As far as this website being pro-Toyota, I would say that is probably unfair, although the B&B seem to be slanted in that direction.

  • Tesla deathwatcher Tesla deathwatcher on Jan 28, 2009

    That's a good point, gm-uawtool. One that I hadn't thought of. And one that may explain a lot of the panic in Nagoya.

  • Johnson Johnson on Jan 29, 2009

    First off, I want to see some cold hard facts. The fact that some of you believe Autoline and Autoblog is ridiculous. Where are the Toyota financial statements showing they went from 90 Billion in cash reserves to 18.5 Billion? I don't believe a word of this, since Autoline and Autoblog are famous for coming up with anti-Toyota drivel that has little to do with facts and reality. Also gm-uawtool, a big part of that money loss for Toyota will be due to the yen's value. That is something out of Toyota's control for the most part. Furthermore, Toyota estimates that loss. Toyota has NOT YET actually posted that loss. Toyota could easily be providing an exaggerated estimate only to shock and surprise everyone with a smaller loss or even a small profit when they report their numbers in a few months.