Toyota Loses $7.7 Billion, Illustrates Global Auto Slowdown

Today, Toyota announced it lost $7.7 billion in the first quarter of 2009. Earlier this week, GM announced it lost $6 billion over the same time period. We’re not bringing this up as a slap to Toyota or a defense of GM, but to better illustrate the fact that the auto industry as a whole is hurting — it’s not a singular fault of U.S.-based automakers.

GM is obviously running on fumes in terms of money, while Toyota has billions on hand to weather the storm. The strength of the two companies is not equal, to say the least.

But if the company that many consider the strongest automaker in the world is suffering as badly in terms of sales and net profit, it’s harder to write off GM’s problems strictly as poor management.

Comments

toyota has some serious and dire problems right now, 7.7 billion lost thats more then toyota predicted themselves and also suggesting could get much worse, this says something about the ecomomy but also toyota, they have to do a few of retooling in the basic needs in a car far as power windows standard across all models, because when your the #1 automaker in the world and you surpass gm the company thats nearly bankrupt in and total loses for the 1st quarter that a huge problem for toyota.

TOYOTA IS FINE. THEY WILL weather the STORM and REMAIN NO.1

Cory:

Thats what im talking about they will remain #1 every automaker has its ups and downs.

Toyota has one problem and it is Historical one.
Trough the history of the world, any enterprise that became huge, it became too big for itself.
Toyota has become vulnerable to crisis. It is large infrastructure and you need to support it by good sales. If your sales go down 46% the problem is big. In other words, there must be a line, where any company should operate under. They should keep costs at level to break even, such if the business will drop so many %. I think, Toyota was caught in the process of "growing" wile ignoring any indications of possible shrinking. They were to conquest the auto-market without noticing that the army is too big and there is not enough food to feed it.

Toyota is NOT fine. They, like every manufacturer out there, are struggling to adapt to the current economic climate. At this time, Mr. Toyoda could care less about being #1. His main concern is about being profitable.

Like everyone else in the world, they are just going to have to cut back and tighten up their belt. I believe Toyota will do a great job in this as they know what people want and run their business very well as well.

Toyota is a company that sells gas-guzzlers (Sequoia, 4Runner, FJ Cruiser, Landcruizer) and so on.

No one wants to buy their products, no wonder they are pushed to #3 in US market and likely to #2 in world market.

They have to change their course and start selling small cars & CUV's that people want at affordable prices.

Its a little premature to say Toyota will be fine. It seems to be difficult to determine how much cash they have but GM had $25B or so on hand as recently as last year. I've seen reports that Toyota has over $30B in cash right now. It wont take long for that to dwindle if revenues keep dropping. The US media is making sure that everyone knows Toyota will survive this unscathed even though they really arent in a position to make that call right now. Ford is OK for now in terms of cash but has said repeatedly that things could get shaky if the market doesn't improve in 2010. Don't assume Toyota can last indefinitely because of their liquid assets. TO my knowledge Toyota has little planned for the future besides more hybrids. Hybrids aren't really selling right now and they need to be closing plants which they will not do.

Sheth, even if Toyota goes out of business, which you seem to be hoping for, they will go knowing they never once foisted an unsafe car like the Ford Pinto on the American Public. Also,Motor Trend this month rates the Ford Edge a poor third against other vehicles of its kind, giving top honors to the Toyota Venza. So maybe Toyota isn't on its last legs as you seem to suggest.

I caught that article, it was all about how the Edge came with huge nice wheels. But the show of the wheels hurt the performance.

Yeah, the Edge Sport wasn't the smartest idea from Ford as of late.

More expensive than the Limited, but less features? Count me out.

max reid, toyota is not the only company that sells gaz guzler, theres GM,ford, dodge, n other automakers, n plus i would prefer to buy a reliable toyota vehicle that will not go out of style unlike chevy. 2nd ppl, every automaker is going thru there ups and downs, just like the real estate market so lets not start to all get on to toyota...

gaulter:

Suggesting the Venza's performance in a test is proof that TOyota is doing well is just silly. The Edge lost that test because of the optional 22" wheels that MT should've skipped. C&D has a review of the Venza and they are much less impressed. Toyota isn't going out of business- ever. I don't want them to either since that would put a lot of Americans out of work. I am just telling you things are as bad as they seem in spite of the spin of the media. Every report I read about their financial results attempted to explain and justify their performance and assure readers that Toyota is going to be fine. A year ago NO ONE thought GM would be asking for government money, not even GM execs. Things change quickly.

great title for this article..maybe not 'catchy' or 'flashy' like gm ipod adapter is ugly or chrysler sucks, but i guess it was the best that could be done.

these losses do illustrate the global auto slowdown...as does the situation with gm, chrysler, and ford. of course, when their situation came up, it was covered here as an indication of their inept business practices...which of course toyota could not possibly be guilty of.

Ouch.

Cody:

THat is how ALL of the media is covering this story. In fact, many stories actually mention Toyota's great management as a reason for their quick emergence from this crisis. Others are saying this is just a temporary roadblock and they will thrive once GM and Chrysler go under and the economy recovers. I would love to know how "great management" can be used in an article about a $7.7B quarterly loss. If their management is great I wonder what you would call Ford's team since they lost only $1.4B in this economy.

its about time! let toyota suffer! i wish they would go bankrupt also! they wiil never be a crappy toyota in my driveway!!! american people are just ignorant, buying that crap anyway!!!!!