While America Slept. Saturday, February 7th 2009
Isuzu sees red: Isuzu posted net losses for the October-December quarter due to weak domestic truck sales, a stronger yen and higher material costs, the Nikkei [sub] reports. Net losses were ¥11.7b in the three months ended Dec. 31, down from a profit of ¥24.4b a year earlier. Sales dropped 21 percent to ¥340.4b in the quarter, down from ¥430b a year ago. On an operating basis, Isuzu lost ¥1.6b, compared with a ¥28b profit in the quarter a year before. For the full fiscal year ending March, Isuzu lowered its outlook to a loss of ¥15b.
Yen for govt. yen: Japanese auto makers are scrambling to raise cash before the end of the fiscal year in March, the Nikkei [sub] says. Nissan is considering applying for the low-interest funds, Isuzu said Friday that it may do the same to raise several tens of billions of yen. Mitsubishi Motors is also considering tapping the Japanese government program.
Toyota stomping on brakes, hard: Toyota, which had announced yesterday that it is preparing for a group operating loss of 450 billion yen for the year ending March, is stepping up efforts to quickly stop the hemorrhage, the Nikkei [sub] says. Toyota is scaling back output more because of an inventory glut due to the sharp drop-off in sales. It aims to cut fixed expenses, which are estimated at 7 trillion yen, by 10 percent. Capital spending could be reined in to around 700-800 billion yen, roughly half that planned for this fiscal year. 74 production lines throughout the world will be slimmed down, especially in Japan, the U.S. and Europe.
German clunker culling better than expected: Until Friday, the German government has received 17K completed applications for the €2.5K clunker culling money. The form has been downloaded 458K times. German Minister of Economy Michael Glos says the program is working better than expected. Rumors of the program running out of money soon are exaggerated, he said according to Automobilwoche [sub]. Reacting to criticism that mostly smaller Japanese cars profit from the program, Glos said that they are full of German parts, and as export nation Germany has to be on the side of free trade. Good boy.
Opel increases production. Yes, you did read right: Due to high demand for its Corsa and especially Insignia models, Opel will increase production in three factories, Eisenach, Saragossa, and Rüsselsheim, das Autohaus reports.
Black January for German carmakers: Volkswagen, which appeared to be immune from carmageddon, and actually had closed the year with a slight plus, caught a big load of the virus: Its worldwide sales dropped approximately 20 percent in January, das Autohaus reports. Audi, which looked totally unaffected in 2008, even lost 28 percent in January. Daimler’s worldwide sales were down 31 percent in January, BMW’s 24 percent, Automobilwoche [sub] reports. (Bad) surprise: BMW’s Mini lost 34.5 percent.
Forza Italia: Italy unveiled a $1.7b program to help its struggling car industry, Reuters reports. The cash is conditional on companies keeping their Italian plants open. Which may attract the ire of the EU. The plan includes cash4clunkers of up to €1.5K. In January, new car sales in Italy dropped 33 percent. Germany is offering 2,500 euros for new car purchases as part of a €1.5b package for its industry, while France has said it could pump €6b of aid to its car makers.
China sales up: China’s passenger car sales edged up in January from the previous month, helped by government policies, Gasgoo writes. A total of 647,594 cars, including sport utility vehicles, were sold in January, up 0.5 percent from 644,083 in December, data from the China Passenger Car Association showed.January sales fell 0.2 percent from a year ago, but the comparison was distorted by a week-long Lunar New Year holiday, which occurred in January this year but in February 2008.
Chery sweet: China’s Chery reported all-time high monthly sales of 3, 5000 units in January, up 36.14 percent year on year and 31.5 percent month on month respectively, Gasgoo says.
Ssangyong busted, SAIC out: Ssangyong Motor Co., South Korea’s smallest carmaker, won court approval for bankruptcy protection, ending China’s SAIC Motor Corp.’s control over its Korean unit, says Gasgoo.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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@BDB: What are the odds of a Japanese bailout by the end of the year? High. See "Yen for Govt. Yen." They are already bailing ....
Hello Mr. Schmitt Any “Germany only,” or “France only,” or “Italy only” legislation will draw heavy and costly fire. May I respectfully disagree? What kind of fire? Weapon fire? No, more likely, words, threats, phone calls, but in the end...I mean France will support Italy, discreetly at first, openly if provoked. Italy and France, 1st class citizens of the EU will do what they want. Even more so as they can count on each other against Germany. It would take maybe all the rest of the 1st class, plus all the 2nd class (Holland, Spain, Belgium et al) - because the 3rd class just doesn't have a say - to maybe beat them. What are the odds of that? What are the odds of a Japanese bailout by the end of the year? High. See “Yen for Govt. Yen.” They are already bailing …. Yes they are. And what kind of provisions have they/are they putting into the conditions to keep it for the Jap car makers only? For example, Nissan is applying/has applied for the bucks in the US, they certainly have taken some of the money put up down here... The Japanese are smart. The rest of the world gives them money on priciple, yet they don't/won't share any of their own. They just do what they want.