Friday, February 6, 2009

Auto Makers' Gold Standard, Toyota, With Net Loss

As Cheech and Chong said, "Things are tough all over".  Automobile's beacon of operational efficiency, Toyota, has tumbled to its first annual net loss ($3.85 Billion,  or 350 Billion Yen).  It's fiscal year ends in March.

toyota logo

At a broad level, there are only two main strategies Toyota can adopt to fix 2009-

a) Increase revenues.  Not easy in this economy.  But with a leadership in hybrid/ economical cars, as well as TCO (Total Cost of Ownership) cars, Toyota has a good chance here. 

b) Reduce costs.  Yes, Toyota is good at this.  And I'm afraid this is where most of their efforts will probably end up.  They are very good to their employees - which of course means contract employees are up a creek without a paddle.  I'm hoping this does not make them cut their R&D budgets for hybrid/ eco-friendly cars.

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