Toyota's Biggest Fear Isn't Recalls, It Is A Stronger Yen

Totota?

Yeah, Does anybody know who or what "Totota" is?

Toyota's Biggest Fear Isn't Strong Yen, It Is those FED clowns.

Poor agent009...he just cant find or bring enough negative news about ToMoCo. What is it with this guy? Is he really that stuck on stupid? If Toyota was seriously in any kind of real financial trouble I dont think they would have even considered producing a masterpiece like the LFA. Let alone not making any profit from it and building it just because they can via engineering prowess/marketing might. Agent009 will be long dead and gone before Toyota even comes close to going under.

Funny, you should say that. I actually have a Lexus in the family. Perfect car for my dad, but you have to remember one thing.

For the better part of a decade the Japanese government maintained an artificially low yen for industry to maintain an advantage. Since the WTO forced them to adjust the currency to normal values you are seeing a fundamental shift in these automakers philosophies. They being forced to maintain their typically higher standards with less of a margin for profit.

They have a balancing act to deal with for the future.

While its easy to slam the Japanese for maintaining a cheaper yen in the 80's and early '90s , it doesn't by far cover the true story. Japan by courtesy of the agreement it has with the US(imposed by the US), maintains all its foreign exchange in US denominated debt. Additionally,it bears a huge sum it pays yearly to US to host them on bases in Okinawa.

The current rise of the Yen : With the US dollar stumbling, the yen is seen as a safe haven for a lot of investors trying to get out of US TBills. Is this going to stop ? Not for some time. The dollar is going to decline and Toyota will have to hedge its currency bets in US and shrink its exposure to the US market.
They have already started that process with (BRIC) nations getting first move on their new investments.
This also explains why Hyundai is growing so much , the won has actually fallen against the dollar , allowing the Koreans to market their cars several thousand dollars cheaper in nearly every transaction.

Exactly the falling won will benefit the Koreans for the immediate future.

in contrast to this, the chinese Yuan moves in LOCK STEP with the dollar. IF chinese cars were exported here, NO ONE will be able to compete against them price wise. just as no one can beat the prices on all the stuff walmart brings in from china.

of course, it's not likely that chinese cars will come here soon. but COMPONENTS, including engines, will be seen in many more GM and other 'domestics' in ever greater numbers as time goes on.

already, GM is planning to export chinese made buicks, chevys, and even cadillacs MADE IN CHINA.

Well, I don't think depreciation of the US Dollar affects only Toyota, but pretty much the majority of the world, thanks to "dollar hegemony" as a result of Bretton Woods regime. It doesn't help when the Dollar has been dropping in value while most countries still store the US Dollar as their primary foreign reserve.

It most likely will mean that Toyota will have to continue to invest in its North American operations, resulting in more American jobs.