Automotive giant posts operating losses of £1.1bn
22 December 2008

Toyota has predicted that it will make a loss for the first time since 1941, when the company first reported on its financial performance.

Toyota is widely considered to be one of the best-managed car companies in the world. News that it’s struggling will send shockwaves through the motor industry.

The operating loss, announced this morning by company boss Katsuaki Watanabe, totalled 150bn yen (£1.1bn) up to the end of Toyota’s financial year in March.

“The change that has hit the world economy is of a critical scale that comes once in a hundred years,” said Watanabe.

Toyota is still expected to make a net profit of 50bn yen (£375m), although that figure is a huge drop from the projected 550bn yen (£4bn) at the start of the year. It now expects to sell 8.96 million vehicles globally this year, down 4 per cent from last year.

In a statement, the company said falling car sales had been “far faster, wider and deeper than expected”.

Much of the problem stems from America, where the car market has almost completely collapsed, eating into Toyota’s export margins.

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Comments
14

22 December 2008

So which car companies can make money in these times?

What should the strategy be when the sales volumes are down so much, effectively destroying their fixed cost recovery? If Toyota cannot make money with their very efficient processes, then god help the rest.

I personally think all the innovative, interesting, fashionable, or economical cars will make hay at the moment (Smart, Audi TT, the new little Toyota IQ, etc) but the "white goods" will be decimated. It's only a question of time - how long before each company's cash runs out before they have no choice but to lay off thousands and thousands of people and shut plants - there is no time (or money) to develop new models, so it's dire for almost all.

The access to credit is crucial for many manufacturers, and it just isn't there. But if everyone's in hock anyway where's the money going to come from? I think in the long term it might be a good things for the consumer (but clearly not the employees), and that we'll see some much more interesting and efficient cars as manufacturers struggle to get a larger share of a smaller pie.

22 December 2008

So there's one year of loss, after 70 years with 100s of billions of gains...

"Toyota in trouble"? For now, that's the overstatement of the century.

22 December 2008

Does this mean now that when a Lexus has a mechanical brakdown they will charge the customer rather than absorb all of costs??

22 December 2008

I don't understand. The operating loss totals £1.1bn up to the end of their financial year in March. Err it's only December. Are we taking last March or are we using a crystal ball?

A few lines later and I'm told Toyota are going to make a net profit of £375 million.

Well what is it to be, profit or loss? That article is REALLY confusing.

22 December 2008

Next the bloody media will say TOYOTA SEEKS BAILOUT

Global Warming.. My Rs

22 December 2008

I think the big problem is that most of the media has moved from reporting facts to backing them with opinion. Trouble is most of the opinions are bullshit and used to sensationalise every story. So Toyota making an operating loss yet still turning a small actual profit is sold to the plebs (us, the dear consumer of media output) as disaster as the biggest and best car company in the wold is going tits up. It is not.

I am getting a bit annoyed with Autocar for dropping down to the Auto Express (motoring Sun) level of hyperbole. All these 'New Volvo S60 revealed'. No, it is a concept hinting at the shape.

22 December 2008

What Toyota have not mentioned is that they are sitting on a cash mountain of over 70 billion pounds from their previous profitable years- its all relative of course.

22 December 2008

Sitting on a cash pile or not, I see them pulling out of F1 soon too.

22 December 2008

Mr. Hallet,

Are you a journalist? Or again more of a tabliod artist? Is Toyota really in trouble? JL

22 December 2008

I agree- but having said that I've always thought of F1 as a hideous waste of money with overpaid and overexposed stars on the track, I cant see that they have generated more Kudos for Toyota or any other mainstream car-maker. Its only my opinion of course

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