Toyota’s Troubles: Money, Metal and Memogate

For decades, Toyota has balanced superb management, impeccable quality, exemplary financial discipline and flawless product planning. As other manufacturers chased market trends and neglected core models, Toyota made incremental improvements to existing models and introduced new models slowly and carefully. Their perseverance has paid off; they’ve elbowed Ford aside and are nipping at GM’s heels. But as Toyota prepares to replace The General as the world’s largest automaker, they’re finding out that getting to the top is one thing; staying there is something else altogether.

No doubt about it: Toyota’s on a roll. They posted a record $3.6b third quarter corporate earnings and hope to exceed $13b profits for this fiscal year. In spite of growing profits worldwide, the picture isn’t so rosy on this side of the globe. Although their revenues in North America were up 17.3 percent, their North American operating profits were down 22.4 percent in the third quarter.
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Neverfollow - 2/9/2007 11:41:05 AM

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Toyota is "perfect"?

Need4Speed - 2/9/2007 1:19:12 PM

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GM has got to be grinning over this right now. The same issues that GM has had to deal with over so many years are starting to bite Toyota in the ass. Yeah you can bring up the GM product deficiency and mismanagement; I mean Toyota certainly has had the benefit of doing it right the first time. But, the point being GM has more experience in dealing with the issues of profit margins, labor costs, and Unions while Toyota has never had to face this Japan. Also, GM is improving on their products while we see an increase in quality issues at Toyota! So now we will start to see the mettle of Toyota as it faces these “growing pains”. My advice to Toyota is either crush the Union, lower salaries and benefits or suck up to the reality that this is the cost of doing business in the good ‘ol U S of A. GM has been doing it for years…so why can’t Toyota?

trd1 - 2/9/2007 1:27:31 PM

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i agree toyota is perfect, almost to perfect, lol.

lewissalem - 2/9/2007 1:44:40 PM

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That memo is a tad troubling. That "premium" that the US worker gets paid allows the US worker to pay for your product. Apparently you CAN put a price on the PR that hiring American workers has.

S4cabriofoxone - 2/9/2007 6:28:40 PM

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Wow, Toyota is going to earn more than what Ford loses. That is quite an accomplishment.

Lexus - 2/9/2007 7:54:54 PM

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That alot money, I wonder how Toyota/Lexus CEO made? and how do they sleep at night?

If I was one of Toyota/Lexus high corporate CEO, I will sleep with a bag fun of money, and many beautiful lady of course;) he..he...he...he....he...

S4cabriofoxone - 2/9/2007 11:24:57 PM

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Uhh, they're like 65-year-old Japanese men. I don't think they make a tenth of a percent of what Toyota Corp. makes, they don't sleep with many women (they're obviously married- Toyota is a family company), and they certainly don't sleep with a bag of money.

4x4ever - 2/9/2007 11:25:33 PM

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Toyota execs really don't make that much money. I live in the OC and know a few. The company didn't make as much because it is paying off a $1.3 BILLION plant built in San Antonia, Texas to TMC in Japan. Once the Tundra sells, Toyota USA will do awesome.

Westside7th - 2/10/2007 1:08:37 AM

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This is what happens when you build cars in the US. Get over yourself.