The financial turmoil has also hurt carmakers by driving up the value of the Japanese yen, which has risen some 25 percent since summer.
Without the dramatic change in the value of the yen Toyota would still have made a profit. What's interesting is seeing how much faster they are responding to a single missed year than GM is to there approaching bankruptcy.
PS: The the parent company is still posting a $560 million profit so they are a long way from real trouble.
I work in the Nagoya, the Town Toyota Built, though not for Toyota. (Well, to the extent that anyone in Nagoya can be said not to work for Toyota.)
The great thing about Japanese corporate discipline: when GM has a tough year, GM blames the year. No way we could have predicted spiraling gas prices, a down economy, and increased foreign competition. When Toyota has a tough year, Toyota blames Toyota. You can bet that somewhere in the bowels of that megacorp is a team of economists reevaluating their currency hedging strategy, while another team is working 16 hour days coming up with a car that captures the imagination of the American consumer but is priced to move as compared to the Prius.
Keep doing this whole "Learn from failure and overcome it" thing for a few decades and you end up the biggest car company in the world and make the competition look like sniveling amateurs.
There is definitely something to be said about being humble during a crisis. I think if more companies took this view during this time, we'd like exit this "down economy" faster.
Toyota Motor Vehicles (トヨタ自動車), which is what most Americans think of when they think of Toyota, is one of the members of the Toyota Group, which used to be a keiretsu, basically a related family of companies in different verticals. (Toyota is distinct from many Japanese keiretsu in that it is largely concentrated in one vertical.)
There are other big components: Toyota Industries (豊田自動織機) for example, which makes machine tools. Number one customer: well, duh. But they also sell them all to other folks as well.
Now here's where it gets hairy: Toyota Industries owns Toyota Motors (largest single shareholder), but Toyota Motors also owns a quarter of the stock of Toyota Industries.
Now repeat that with another dozen or so major companies which you probably haven't heard of, and any number of minor satellite firms.
This ends up as one big web, which is collectively the Toyota Group. It is very possible for the group as a whole to be prospering while one or several group companies struggle. How they work this out is an exercise in business management and accounting that would boil your brains -- don't ask me, I'm just an engineer (and, er, customer and shareholder and not-quite-employee but as I mentioned disentangling Nagoya from Toyota is like asking for a human body minus all the carbon).
Without the dramatic change in the value of the yen Toyota would still have made a profit. What's interesting is seeing how much faster they are responding to a single missed year than GM is to there approaching bankruptcy.
PS: The the parent company is still posting a $560 million profit so they are a long way from real trouble.