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Tuesday, December 23, 2008

Toyota Cuts Outlook

4:29 PM | Author: Brett Bumeter - Anonymous | | | Edit Post
Like so many other businesses, Toyota announced that they will need to cut their groups operating outlook due to their first ever annual operating loss. The loss is a result of the crippling worldwide economic downturn. The cut comes half a dozen weeks after chief rival Honda announced a cut to their outlook as well as again a week or so later when they cut once again. 
"This is very, very, very bad," said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments. "There's a chance they could fall into the red in the next business year as well. "This is also not just a problem for Toyota. What is good for Toyota is good for the Japanese economy."
Currently automakers across the world are attempting to deal with a number of crisis' stemming from the global recession and are coming out thiner than expected. In addition to Toyota's operating issues we are well aware of Detroit's big-three's woes and the effect they are having on an already down economy. Many of the large car companies are making cuts on a number of levels including executive benefits and perks as well as cutting contributions and sponsorships. 
It will be interesting to see where the auto-makers find themselves in the upcoming quarter as as well as spring 09'. I will also be curious to see where the United States Congress will come in regarding an economic bail-out in the form of a bridge loan. Only time will tell.
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