Toyota's Terrible Horrible Awful Quarter

Posted by: David Kiley on August 6, 2008

Looking ahead to tomorrow’s quarterly earnings report from Toyota, the estimate is that the automaker’s operating earnings will PLUNGE 40%. But that would be a PLUNGE to about $3.6 billion, largely on declines on its U.S. business. And analysts still have the company on track to make at least $15 billion for the year.

It’s all a matter of perspective. I have to check my records and data, but I’m pretty sure no Detroit automaker has ever made that much in a year even when the industry was going gangbusters. True, Toyota dosn’t pay healthcare costs for workers and retirees the way GM, Ford and Chrysler have. But still…….there would be naked dancing in the streets if Ford or GM could manage to clear $15 billion in operating profit in one year.

Reader Comments

Dominic

August 7, 2008 12:42 PM

David


Why don't you do some homework on your own instead of repeating parrot-like the corporate PR line??
The problem with the domestic car makers IS NOT the healthcare cost for employee and retirees.
Do you have any idea what ar the labor cost in Germany?? Stll that doesn't prevent BMW and MB to go gangbusters.
Some of the Japanese models are made in Japan with very high wages and cost of transportation to top that..still they sell at a profit....ask yourself why...
The issue with Ford GM and Chrysler is that they built ugly, unreliable, high consumption crappy automobiles for too many years...management knew what was coming since the 80's...they decided to bury their heads under the sand, now it's payback time...
Leave the employees benefits alone, they are NOT THE PROBLEM.

From Kiley: I only mentioned the healthcare difference in passing, not as the only difference between Japanese companies and Detroit. You get no argument from me---Compared with Toyota, GM, Ford and Chrysler have been miserable strategic planners.

Dominic

August 7, 2008 6:07 PM

David

I understand what you say and I apologize if I came along strong but I'm really fed up with listening to this excuse over and over in the media like it was one of the main issue if not the most important one.
Employee benefits are simply not a factor in the whole story and should not even be mentioned.
Like you said, miserable strategic planning....and maybe that is an euphemism...
And not only compared to Toyota but to many other brand as well.

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