Toyota is beginning to feel The Big 2.8's pain. The world's largest automaker released their first quarter financial results. No question: they got dinged. While ToMoCo's books are not in the same universe as GM or Ford, the Japanese carmaker's operating profit dropped 39 percent to "only" $3.8b. That's just over half of the $6.2b they showed for the same quarter last year. Toyota Exec VP Mitsuo Kinoshita attributes the losses to a number of factors, including the weak U.S. dollar and the soaring price of raw materials. He's not too concerned over lease residuals and dropping used car prices, though. "With Toyota's traditionally prudent approach in lending, together with its efforts to further strengthen the credit control and collection system, the percentage of credit losses has shown some stability. As for residual values, Toyota will continue to keep a close eye on the used car market and set suitable values in a timely manner." This is the second consecutive quarter their operating profit has dropped. [source: Toyota Press Release]
Click here for First Quarter Operating Results and First Quarter Financial Summary
ouch.
on the other hand, i’d rather make $4 billion than lose $15 billion.
they’ll be fine, even if their stock price tumbles a bit
From WSJ today, Toyota is taking a 9 billion yen hit on lease depreciation. According to Google’s currency calculator, that’s a mere $82.4 million – pocket change. By comparison, the D2.801’s financial units each took over a billion dollar writeoff.
Oh snap!
Another chink in the armour!
A write off isn’t a total loss.
wow, that’s quite a drop. Since sales are only down in the single digits YTD, I think the weak dollar is cutting into Toyota’s profits. Which is probably why we’re getting a limited number of Prii. They can make much more profit on them elsewhere in the world.
Hehe I like the implied zing at GM for their Got A Pulse? Financing.
That is a big ouchie. No matter how your competitors are doing, losing operating margin is very painful. Two quarters of it is time for serious strategy review. In their case, not necessarily car-line strategy, but material sourcing and revenue repatriating strategy.
With the super weak dollar and rising material costs, they need to at least get a handle on one of them to stem the tide. 40% is massive and unsustainable. One more quarter like that and their credit rating will take a huge hit.
Why are they releasing their “Q1” numbers when everyone else is releasing their 2nd quarter results?
Typo?
Or is this the same type of “restatement” that Gm always gets slammed for?
Why are they releasing their “Q1″ numbers when everyone else is releasing their 2nd quarter results?
Typo?
Or is this the same type of “restatement” that Gm always gets slammed for?
You can put away your conspiracy theories. Toyota’s fiscal year goes from April to March. So Toyota’s first quarter runs from April 1 to June 30.
Not every corporation uses the calendar year as a fiscal year. It’s not a restatement of an earlier period, these are the results for the most recent period.
Only $4 billion in profit! Can you imagine what GM would do to Rick Wagoneer if they “only” had a profit of $4 billion.
if GM made $4b profit then they’d give all their executives a $200 million bonus so in the end they’d reflect a loss still.