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Discussion Starter · #1 · (Edited)
NOTE: This article is normally not available for direct posting due to subscription viewing requirements. It is however, now available for free viewing following a simple registration.

AN is having one of their 'opening viewing' periods from the 11th thru the 17th of August.

More importantly, although the conclusion is not drawn, the numbers involved are all contained in two sentences on the first page of the summary in Toyota's press release ( 7AUG 2008 ) for the report itself -which will be posted shortly.

http://www.autonews.com/apps/pbcs.dll/article?AID=/20080811/ANA03/498099051/1117/COPY01&Profile=1117

Toyota's quarterly N.A. profits evaporate
Earnings hurt by leasing crisis, U.S. downturn and rising incentives

Hans Greimel
Automotive News
August 11, 2008 - 12:01 am ET

TOKYO -- Toyota's strong operating profits in North America nearly vanished in the April-June quarter.

North America operating profit plunged 98.9 percent to $15.2 million from $1.40 billion in the same fiscal quarter last year.

Executive Vice President Mitsuo Kino****a said North American business traditionally has chipped in about half of Toyota's overall operating profit.

The U.S. leasing crisis contributed to the pain. Kino****a did not detail the total amount booked for falling residual values. But it was the sum of the same amount booked in the first fiscal quarter of last year plus ¥9 billion ($85.7 million), he said.

Still, Kino****a said Toyota's provisions were far less than its competitors.

General Motors took a $2 billion hit in the quarter, while Ford Motor Co. wrote off $2.1 billion. Chrysler LLC's results were so bad that it left the leasing business altogether.
Note: This is in regards to April, May, and June - which is the first fiscal quarter period for Toyota in Japan.

It does not include July 2008's results.

**************
Notice also this is in regards to North America - without Canada and Mexico helping out ..... USA most likely did go negative.

In the most recent, previously strong quarters that Toyota has reported, N.A. ( USA mostly ) contributed 60% not 50% of the net profit although 'historically speaking' could count an average back to 1958 or somewhere in between..


Finally, notice how all the American ('press') financial analysts :lmao: ( except a later add to an earlier AN article ) missed pointing this out.
 

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Isn't Automotive News in Toyota's pocket according to you? So why would they use the word 'evaporate' in their headline?

I love how the guy's last name is censored. :)
 

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Discussion Starter · #3 · (Edited)
Because , believe it or not, this is still a type of damage control article - notice it doesn't fully cover the implications of this or the other completely legitimate but manipulative massaging of NA's 'numbers' - or the final 'polish' in Japan.

As added above, this is on the first page summary of Toyota's own press release.

Except for the fella' from Credit S Bank - who no one wants to quote in full, nobody wants to go thru a full 'pros' and 'cons' :D analysis of the full report.

Here is the plain as day press release portion that matters from Toyota:

http://pressroom.toyota.com/Releases/View?id=TYT2008080795008

Vehicle sales in North America totaled 729 thousand units, a decrease of 33 thousand units. Operating income decreased by 91.1 billion yen, to 69.1 billion yen including 67.5 billion yen of valuation profit on interest rate swap transactions.

Although the US market, primarily the truck segment, is slowing down, Toyota earned a record high market share of 17.4 percent for this quarter.

However, decrease in sales volume, the shift of product mix to compact cars, increase in sales expenses such as incentives and increase in reserves for bad debts, resulted in declining profits.

Toyota will take swift actions in accordance with market changes by increasing the supply of models in high demand and launching new models.
Now do the math, 69.1 - 67.5 = 1.6 billion Yen for NA operating income ie from automotive operations - down from 91.1 + 69.1 = 160.2 billion Yen ie 1%.

Convert to dollars ..... and btw, consider all the rest - which is why the low reserves for bad loans and leases matter ( as well as the future Yen valuations) and you can then talk about a very slightly larger number compared to the past - that still is bad - which is what AN did here.

What this is all about is 'minimizing' the 'appearance' of weakness in NA - ie the USA.

Similar is being done in regards to European and Japanese operations.

We will have to see how the next three quarters unfold - there is a bit of a gamble on Toyota's part involved here - it may or may not turn out well for them.

On this one, the key insight numbers are operating income, and operating profit.
 

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imagine if toyota is having such difficulties making profit in NA how much more difficult it is going to be for the big 2.8 to ever turn a profit in NA!
 

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Didn't GM just lose the most money EVER in the history of any automaker? :eek:

Why worry about that? The OP has an MO- and that MO is to point out the failings of other companies. It's a huge decrease in profits for Toyota in North America, but they're still not losing money. Meanwhile the US automakers are doing their best to imitate a certain German flying zeppelin, but you won't see our OP pointing that out.
 
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