Thanks largely to stimulus programs in the US and Europe, Toyota announced that it has eked out an operating profit of 58 billion yen instead of the average estimated loss of 63 billion yen from five analysts. Toyota now is forecasting a lower operating loss of 350 billion yen ($3.9 billion) for the year through March 31, and is presumably on track to a profitable following year. But with the stimulus programs’ end, Toyota continues to hunt desperately for cost savings, like its recently announced elimination of the F1 program, which cost a tidy $300 million per year.
Investors were unimpressed, and shares were slightly lower on the news. Honda and Nissan have shown better ability to weather the global downturn. Nissan shares have more than doubled this year, while Honda is up by almost half over the same period. Toyota said the 2Q improvement came mainly came from improved used cars prices in the United States. Without such finance-related gains, it would have stayed in the red, an executive said. [Reuters]
In the most recent round of the floor-mat saga, Toyota has refuted allegations that the automaker tried to sidestep engineering or design defects resulting in the safety recall of 3.8 million vehicles.
“It is not a part of Toyota’s culture and the Toyota Way to cover up anything. And we are proceeding with open and frank discussions with NHTSA,” Toyota Executive Vice President Yukitoshi Funo said.
This comes one day after NHTSA slapped Toyota’s wrists for issuing “inaccurate and misleading information” about the safety recall, which advised drivers to remove floor mats that may potentially jam underneath the gas pedal and cause unintended acceleration. And that came a day after Toyota stated that the NHTSA found “no defect exists in vehicles with properly installed floor mats.” Actually, the NHTSA said these vehicles have a “very serious defect.”
Funo said Toyota had “no disagreement on this issue. Basically, we are proceeding with discussions with NHTSA, and we expect to have an agreement as soon as possible about what we should do.” Stay tuned for round four. [Automotive News] (sub)
Mr Neidermeyer,
I strongly advise against using stock price as a barometer of a company’s health.
As Mr Farago pointed out recently, people were mocking him for his prediction of a GM Bankruptcy because shares were riding at about $40.
Also, at the time of writing Toyota stock is up 1.23% and Honda is down 0.19%. Another reason why stock price isn’t a good measure. It’s a fickle metric.
Though the one thing about Toyota which worries me is their management of a recall which involved a dodgy floormat. Can’t Toyota manage that properly?
I think what’s confusing is NHTSA did deny a petition from an individual for a formal defect investigation of the floormat problem. However, the agency is clearly still looking at this case at some level.
@210delray
http://www.latimes.com/business/la-fi-toyota-defect28-2009oct28,0,6777903.story
According to this, it appears that they denied it, but then maybe removed the denial. After reading this more, there have been 5 times since 2000 that the petition for sudden acceleration has been denied. WTF NHTSA.
Looks like Toyota isn’t the only one would should be getting some bad press. What has the NHTSA been doing all this time?
Either way, Toyota saying that there is no problem when the mats are properly installed is what is getting them in trouble. That appears to me for Toyota saying that it really isn’t a defect, when in fact, it is a very serious defect. I don’t see how denying a petition would give any validity to that statement.
Cammy Corrigan: Mr Neidermeyer,
I strongly advise against using stock price as a barometer of a company’s health.
I’m not using it as a barometer. I was reporting the initial market reaction, and that for the year, Honda and Nissan’s stock have increased almost twice as much as Toyota’s.
Are you suggesting it’s somehow taboo to mention a company’s stock price? If I felt there was some substantial disconnect between the stock price and the underlying circumstance, I would say so.
@steven02:
How is it Toyota’s problem, when a floor mat that can be removed by the owner (and probably not installed properly afterwards) causes “unintended acceleration”?
Do we need another warning label on floor mats? Probably we need a universal warning level on everything, like “Watch it!” or “Think!?
It stinks and reminds me of the famous Audi 5000 scam during the eighties.
Lawyers and MSM journalists will be happy.
So that’s a Toyopet. Fetching little thing.
My mom went through two cases of unintended acceleration with her Toyota Corolla. The only difference is her car didn’t acclerate only the engine revved because she kept her foot mashed down on the brake. That pretty much eliminates the “stupid driver was pushing the accelerator not the brake” theory that most people on this site put forth. Now I wonder if the floor mat was to blame for the two incidents with her Corolla. As far as “proper installation” of a floor mat goes, I’ve never owned a car where floor mat installation was an issue. You simply laid it on the floor in the floor pan depression that was the same shape, and then either hooked it onto a post embedded in the carpet or not, depending on the particualr car. Installing a floor mat shouldn’t involve any level of difficulty. If it does, somebody needs to rethink the design of the pedals, the floor mat, and potentially the floor pan.
There’s more to come yet on the Toyota F1 decision, especially if Renault pull out too. They are actually contracted to run in F1 until the end of 2012.
If there’s one thing people have learned in F1, is that you don’t mess with little Bernie Eccelstone.
This would also appear to rather skewer the LF-A marketing “plan”.
BTW, good job on the numbers Toyota. Predictions of your demise might have been premature.
To the 2009 Prius ex-owner: Dear sir, you are right to feel “lucky” … just imagine the unsuspecting new owner of that Prius. No doubt the salesperson failed to inform the new buyer(s) of any “known defects” or “negative history” associated with that vehicle (keep in mind the dealership is fully aware as to why that Prius was traded in). Unfortunately, Toyota Corporation, Toyota dealerships and their associates has chosen to take the low-road.
While floor mats can in fact can prohibit the accelerator pedal from “returning” to the idle position, this does not account for the many many incidents and reports from owners “without” floor mats in their vehicles and cruise controls that did not disengage.
My local Mechanic/Guru has installed a device on my 2005 Camry after a my wife walked home, white as a sheet, after her death-defying 110 mph experience. Thank God it was an open stretch of road and at a time when there wasn’t a lot of other cars on the road. She managed to put the car in neutral and move onto the shoulder. The engine was full-throttle and over-revving when she turned it off. And no, no floor mat interference.
This is an alarming consumer problem which involves more than just the Toyota/Lexus owner. It involves every single driver and pedestrian on and near the roads today … think about it!
Best regards,
Don
The mechanic’s email is 4dccrew@msn.com