Although genetically adverse to saying the L-word, the Japanese will have to famiriarize themselves with it: “Plunging sales worldwide and the yen’s sharp appreciation will likely push Toyota Motor Corp. into its first-ever operating loss” in their 2008 fiscal year, writes an aghast Nikkei (sub) today. In earthquake-prone Japan, this resembles a 9 on the financial Richter scale. Once, Toyota came close: In ancient 1949, when Japan was a chaotic mess after World War II and was ruled by a benevolent dictator called McArthur, Toyota had a pre-tax loss. But they never posted an operating loss since Toyota began releasing earnings figures with fiscal 1940. This announcement will leave Japan shell-shocked.  They have a different attitude towards losing money than in What-me-worry Land.

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Ah ha ha ha — I’m still having a ball. I love these X vs. Y QOTDs. Maybe it’s time for a new feature? Hmmm… Anyhow, there are a lot of people (er, were a lot of people) that purchase two-door sports coupes. So many in fact that Nissan’s on their 6th iteration of the Z and Ford’s Mustang is older than most people. Last week through, uh, fate, I was able to drive the 2010 versions of each car (Mustang review here ,370Z here). And as different as they are, man, are they the same. The Z makes do with “just” six cylinders yet weighs about 200 pounds less than the more powerful V8 ‘Stang. Therefore performance is nearly identical. In fact, so close that it just doesn’t matter. But surely the IRS Nissan has the edge over the live axle Mustang in the handling department, right? The 370Z might be able to provide flashier numbers on a skid pad, but on the street? The two cars feel equally capable. Looks? Take your pick — both cars are muscular, handsome, loaded with retro cues yet modern. Hamburger vs. Sushi? Depends on my mood — one has no inherent advantage over the other. 5-speed vs. 6-speed? I prefer 4-speeds. Interiors? Both are good, not great. So, how then? Here’s the thing — Nissan swore up and down that when they were developing the 370Z they didn’t bother to benchmark the Mustang. Porsche Cayman? Yes. BMW Z4? Yes. Audi TT? Yes. But while they were playing footsies with the Germans, Ford went ahead and developed the Bullitt, one of the greatest cars of the last 10 years. And the 2010 Mustang GT is a better Bullitt. So yeah, Mustang for me. You?

Autoexpress has one of those compelling-but-mysterious stories on a possible new MPV from Toyota. We know that it will be a compact seven-seater, but the basis for the new MPV is still unclear. “We’re looking at a seven-seater based on the Prius. It would use a lithium-ion battery, and could be here by 2012,” says one anonymous tipster. But iQ city car chief engineer Hiroki Nakajima claims that another approach could be in the cards. Specifically, Toyota is looking at proliferating iQ space-saving developments across its product line, and Nakajima reckons that iQ breakthroughs could be used to squeeze seven seats into a Yaris platform. “We’re working on a seven-seater that’s the size of the Yaris,” says Nakajima. “We can do it, and give limo-like legroom in the back!” Of course this approach would likely make a hybrid system too expensive. For the US market, a slightly-larger Prius-based option (such as the Estima concept pictured above) would likely be a more popular choice. Frankly, the California soccer mom arms race would never be the same. Until the Lexus version comes out.

A short overview of what happened in other parts of the world while you were in bed. TTAC provides round-the-clock coverage of everything that has wheels. Or has its wheels coming off.

Nikkei: GM & Chrysler talking again: The biggest news in Japan today is that “General Motors Corp. and Chrysler LLC have reopened merger talks, as Chrysler owner Cerberus Capital Management LP has signaled its willingness to give away part of its ownership in the auto maker,” the Nikkei (sub) writes. The Tokyo paper assumes that “the renewal of the talks could be a way for Cerberus to show Washington — which is weighing a $14 billion rescue package for the auto industry — that it wants to cooperate in restructuring the industry.” Japan is very worried about any of the D2.8 going out of business, as it would decimate the supplier base of their transplants.

Japan on slim-fast: The Japanese are skinny already, pocha-pocha (chubby,) or even debu-debu (fat,) are a rare sight in the land of sushi. Prepare for even leaner figures, the Nikkei (sub) writes. “The situation is worsening day by day,” Honda President Takeo Fukui said yesterday, “no signs of a recovery are in sight.” In addition to the austerity measures already announced by Honda, there are more: One year delayed  are a new factory in Yorii, and a new R&D center in Sakura, originally scheduled to come on-stream in 2010. Honda group firm Yachiyo Industry likewise delayed their new factory in Yokkaichi by slightly more than a year. Nissan said yesterday that it will reduce domestic car output by and additional 78,000 units than previously planned. The Nikkei: “Freshly revised production figures from Honda and Nissan have increased the total planned worldwide output cut by Japanese automakers for fiscal 2008 to slightly more than 2.2 million.”

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Conservative talk show host Bill “I swear the nuns didn’t beat me” O’Reilly likes to rail on (and on and on) about America’s cultural degradation. In fact, it’s one of our country’s greatest strengths. Rappers who started by singing (well, shouting) the praises of capping cops end-up in Bentley-and-bling filled videos that make unbridled consumerism seem like the ultimate revenge against The Man. Hell, there ain’t nothin‘ we can’t assimilate! For profit, obviously. And the people who profit most are always the distributors. I’m not sure what Karl Marx had to say on the subject– I’ve got “How To Make a Killing off of Karl Marx” on my night table– but he who controls the distribution owns the gold. So along comes Zipcar. Nice idea: rent a car by the hour. Here’s your card. Pick up a car, swipe ‘n go. After eight long years, they get a bit of traction: 5,500 cars in 13 cities. Rad dude! I guess we’re showing those big rental companies how it should be done! Problem: Hertz.

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A short overview of what happened in other parts of the world while you were in bed. TTAC provides round-the-clock coverage of everything that has wheels. Or has its wheels coming off.

D2.8 may get unexpected break – strength from weakness: The money-losing automakers made at least some money in some foreign markets. However, the recent strength of the greenback wasn’t in their favor. In July, a profit of one Euro translated into a $1.6. But what counts is when the books are closed, and that usually happens at year end. The recent strength of the dollar made foreign profits look less juicy. In October, that one Euro profit was worth only $1.23 – ever since, the Euro bounced around in the $1.25 to $1.29 range, which worried CFOs with foreign profits to no end. In the last few days, a miracle happed: The dollar got weaker. In the last few days, the Euro shot up into the $1.40 range, and it may even climb some more. With a little luck, and some end of year central bank machinations, a profit of one Euro could translate into a $1.50 by year’s end. Which will look quite good in the books. The bad news: If you have foreign losses, it will have just the opposite effect.

Nissan cuts output: Nissan wanted to make 1.38m units worldwide in their 2008 fiscal year, which ends in March 2009. That plan is no more: Nissan will end the year with 230,000 units less, a reduction of approximately 17 percent, the Nikkei (sub) reports today. Nissan will also eliminate “all nonpermanent positions” by March, becoming the first major Japanese automaker to ever do so. Starting in January, assembly work will be suspended for several days a month at two factories in Japan. Production speeds will be slowed. By March, all temporary workers will be gone. Any further layoffs, and the (in Japan) sacrosanct permanent workforce will be affected.

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Yesterday was fun. For me at least. Seriously, as someone who thinks about cars all the live long day it is always fascinating to get inside other peoples’ heads and see how they perceive those lovable hunks of steel, cloth and plastic. So, doing Crown Vic vs. Camry was actually interesting and informative, not just petty and vindictive. Today we’re going to focus on two other cars that don’t interest me in the slightest. The first is the very worst new car I’ve ever driven and the second is by far and away the most boring. I ain’t kidding around here people — when Chrysler’s obituary is written, the Sebring should take center stage. Remember, it’s the car they released after the smash success of the 300C. Sad times. But at least the Sebring has a (optional) motor with some guts. The Corolla is like driving chloroform. Snore says I, big time snore. And so if I was forced to choose, I’d actually pick the Chrysler. While holding my nose, of course. You?

Even Detroit’s fiercest defenders allow that The Big 2.8 should have thought a little further ahead than a single financial quarter– although they’re sure that Wall Street’s responsible for the shorter-termism. Hey! Anyone remember when Cerberus said they’d be better owners for Chrysler than anyone ’cause they didn’t have to report to Wall Street? You know: we’re quick! Less bureaucracy! More selling! Turn on a dime! Well, a dime’s about all they have left and former ToMoCo Prez Jim Press has dibs on that bad boy. Anyway… even though Toyota isn’t $30b in debt, the Japanese automaker is in full crisis mode. Yesterday, the Prius plant plotzed and they shit-canned executive bonuses. Today, we hear that the diesel engine project with Isuzu is DOA– minus the “OA.” You know that $1m ho’ down the Toyota used to throw for its dealers in Sin City? Gone. Seriously, talk all you want about misplaced Tundras, but these guys don’t dance this mess around. Just-auto {sub] reports that Toyota’s UK Managing Director reckons it could be as long as five years before the automaker’s biz recovers to last year’s level. “We have our forecasts for the next 24 months,” Miguel Fonseca revealed. “But it is very difficult to forecast further. After two years I think there will be a slow recovery, but my own belief is that it will be five years before we are back where we were.” And here’s something The Big 2.8 might have said, I dunno, ten years ago…

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“In Woodhaven on Friday,” The Detroit News reports, “someone punctured the tires of five foreign cars — a Honda, Hyundai, Mazda, Toyota and Volkswagen — and used a marker to scrawl ‘Buy USA’ on the sides of the vehicles, in the lots of Lowe’s and Kohl’s stores near a Ford plant.” As TTAC’s publisher, I decided not to blog the story. There was no proof that the a Ford worker had carried-out the attack. As an isolated incident, I felt the vandalism didn’t deserve what Margaret Thatcher called “the oxygen of publicity.” We can debate the ethics or wisdom of that decision all day long. But today’s DetN story is flat-out incendiary. “Backlash brews in wake of Big 3 bashing” is strong beer. With that kind of headline, the onus is on scribe George Hunter to prove that Detroit is about to erupt into violence– the clearly implied and then directly stated premise of the piece. “After a month of Detroit-bashing in Washington and nationally,” Hunter writes. “some say a backlash is forming among Metro Detroiters, annoyed by the attacks on their lifestyle and angry at their neighbors’ choices of vehicles. Some fear that simmering resentment could turn to outright hostility.” Some? You mean like some people you specifically rounded-up to prove your inflammatory central thesis? Yeah, like that.

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The Geo Metro. One Liter. Three Cylinders. A near-car that represented automotive nirvana for tree-huggers and penny pinchers throughout America. Except not anymore. Gas is down 60 percent from its zenith; the Metro has once again become as fashionable as OJ Simpson at a Jewish family reunion. I bought one today with only 95k miles on it for only $500. White. Base. Nothing special. But then again, what is these days? I’ll tell you what is. Toyota and Lexus SUVs. These things are getting bought with price premiums that would make a Kuwaiti Mercedes dealer blanch. Spied a 2001 Toyota 4Runner Limited in Blue loaded up with 178,524 miles. It sold for $6800. A same year Lexus RX300 with, get this, 236,499 miles, sold for the same price. Why? Well a mint condition Toyota SUV is apparently worth its weight in lead (which is still expensive these days) if you’re willing to press the mileage ‘reset’ button. Meanwhile, a 2005 Toyota Celica GT with 100k miles sold for $7k. No one seemed to care. Young buyers are becoming an endangered species with the credit markets flipping the bird to the young and equity deprived. Also, it’s a complete bastard these days to get financing approved for any late model vehicle with over 80k.

European car buyers show solidarity and join the worldwide buyers’ strike. November sales in the EU fell 26 percent to 932,500 units, Automobilwoche (sub) reports. That, people, makes the EU the world’s largest car market. And we aren’t even counting “light trucks” here. Western Europe sank 26 percent to 854,700 cars. For the year, Western Europe is down 8 percent. Biggest losers: Spain (-50 percent,) UK (-37 percent,) Italy (-30 percent.) Even the new EU countries, previously the only places where there was growth, are no longer immune. Except for Poland (+11 percent) und the Czech Republic (+2 percent,) sales are down everywhere. Rumania even imploded to the thumping tune of minus 53 percent. Car sales in the new EU countries are down 23 percent to 77.800 cars. Nobody is an island, even Central Europe ain’t.

As far as brands go, GM is the biggest percentage loser with -37.5 percent. They sold 76.383 units in November, their market share shrunk from 9.7% to 8,2%. Toyota lost a third of their sales, their market share is down to 4.7 percent from 5.2 percent. Ford gets a gold star. They lost only 19.6 percent and increased their market share from 9.5 percent to 10.3 percent. And it gets worse …

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A short overview of what happened in other parts of the world while you were in bed. TTAC provides round-the-clock coverage of everything that has wheels. Or has its wheels coming off.

More belt tightening in Japan: A year ago, Suzuki entered the World Rally Championship. Yesterday, they said they would stop competing in the series from next year “due to the cost burden,” as the Nikkei (sub) has it.  Fuji Heavy Industries, the manufacturer of Subaru, is also considering pulling out of the WRC. This follows Honda’s recent decision to withdraw from Formula One racing. The annual cost of staying in WRC racing is estimated to be in the $50m ballpark. Every Yen saved is a Yen earned. Everybody is waiting for more expensive shoes to drop in Formula 1, where the price of admission is $500m. All eyes on hapless Toyota. For starters.

BYD bullish on cars: China’s BYD Co. aims to double sales of automobiles next year, defying the gravity of the auto market, Gasgoo reports. BYD plans to sell 350,000 vehicles in 2009, up from a total of 180,000 cars it plans to sell this year. In 2007, BYD sold about 90,000 vehicles. What is hurting BYD is the slowdown in worldwide mobile phone sales, for which BYD supplies the bulk of the batteries.

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As a number of you saw, I drove and review the 2010 Ford Mustang GT. I really liked it. Good car, etc. Naturally, of course, I expected TTAC’s so called “Best and Brightest” to discuss the finer points of my review. After all, Ford has sold nine million Mustangs and I just called the new one the best ever. This after they put me up in a fancy-schmantz hotel and fed me great food and free booze. More scandalously, the new for 2010 Mustang still sports a (gasp) live rear end. And I loved it. Glowing review, etc. But, instead of focusing on the latest pony car from my friends at the Blue Oval, the conversation degenerated into, “My Crown Vic can out tow your Camry.” No, really — that’s what people were talking about. And you know, if that’s what the people want, that’s what we’re going to give ’em. In the blue corner, hailing from Georgetown, Kentucky and weighing in at 3,280 lbs, the sleeper from the far east, the barbiturate to my Viagra, sexless on wheels, Toyota Camry! And in the red corner, a car so great it’s no longer sold to the public (unless you live in Kuwait), featuring both Watt’s linkage and a four-speed automatic, the car that’s older than some of our readers, Ford Crown Vic! Let’s make this a fair fight. And then let’s never speak of either car again.

If you journey to the Detroit Auto Show this winter, you will get a chance to see the new Mercedes A and B Class models. I know, I know. Who cares, right? (No points for guessing Automotive News [sub]) Especially since the Benz Boys will be headlining their Concept BlueZero hybrid/alt-fuel roadshow at the wasteland formerly known as the Detroit Auto Show. But did you know that all of those fancy futuremobiles will be based on the “sandwich board” platform which first debuted in production on the original A-Class? Apparently it makes for a lot of flexibility with powertrain choices. The new A and B will ditch the intriguing but space-limiting concept for a standard FWD layout, but at least the B and “likely” the A as are headed stateside sometime in 2011. Absent a GM bankruptcy-triggered end of times, of course. And though we won’t be in Detroit to snap our own photos of these Euro-hatches (right, boss?), their American ambitions bring up a wrinkle on the stimulating discussion on our national ambivalence towards compact cars. Read More >

Toyota had planned on beginning production of Priora at its Blue Springs plant in 2010, but those plans are now on hold indefinitely, according to the AP (via CNN Money). According to ToMoCo spokesfolks, construction of the plant is 90 percent complete, but installation of its machinery and tooling (the “most time-consuming elements”) has been delayed. And what of the 100-odd folks hired to oversee construction and install human resources plans? “Those people’s jobs are safe, and we’ll find things for them to do,” says Toyota’s Mike Goss. With weak sales affecting even the once-hot Prius, Toyota is responding quickly by holding off on a hiring binge until the market begins to recover. Consider the Tundra lesson learned, but in tough economic times those jobs will be missed. As will the $239m state incentive package, not to mention the $235m in tax revenue that the plant is expected to bring in over its first ten years of operation.