Toyota Cuts Production, Nissan Says Profit Will Be Wiped Out on U.S. Slump

[Purveyor]

Nov. 19 (Bloomberg) -- Toyota Motor Corp. will further trim North American production and Nissan Motor Co. said second-half profit will fall to ``zero'' as a recession pushes U.S. vehicle sales to the lowest annual tally in 15 years.

Toyota, heading for its first drop in U.S. sales in 13 years, will extend the Christmas-New Year closure at its U.S. and Canadian plants by two days and make other cuts, spokesman Mike Goss said in an interview yesterday. Nissan Chief Executive Officer Carlos Ghosn made the profit forecast in a Wall Street Journal interview, confirmed by company spokesman Simon Sproule.

Nissan and Toyota have cut their annual profit forecasts by more than 50 percent because of the yearlong industrywide slump in the U.S., the world's largest auto market, and waning demand in Japan and Europe. The value of overseas sales is also being eroded by the yen's 16 percent gain against the dollar and 34 percent rise against the euro this year.

For Nissan, ``there's a possibility of a loss in the second half, depending on what happens with the currency and sales,'' said Koji Endo, a Tokyo-based analyst at Credit Suisse Securities (Japan) Ltd., who rates the company ``underperform.''

--snip--
``Depression Level''

U.S. sales are at ``depression level,'' according to David Cole, chairman of the Center for Automotive Research in Ann Arbor, Michigan, forcing carmakers to offer incentives to lure buyers back into showrooms.

MORE...

BLOOMBERG: http://www.bloomberg.com/apps/news?pid=20601103&sid=aL8oW27SB3So&refer=us

[HereSince1628]

1. But but but they make better cars, hybrids, etc. etc.

A genius built business strategy is good only until it hits its first recession.

[EnviroBat]

2. Hmmmm, I wonder if this is a good time to purchase a car.

I imagine I could "deal" myself a nice car for cheap.

[ogneopasno]

4. Crap, you beat me to it.

[ogneopasno]

3. Buuuuuttt! I thought they could do NO WRONG because they "build cars people waaaant!"

Huh.

[ben_meyers]

5. Let me be the 1st to say

BAILOUT

Actually this is precisely why I'm opposed to a big three bailout, everybody is in dire straits and only the strong will survive.

[greguganus]

6. A friend of mine told me he went to buy a new car and asked about discounted price.

He said the dealer told him he can sell his cars at auction and make more profit than selling them to the public visiting his dealership. Guess the auction buyers aren't too smart, or are getting a smaller discount for buying multiple vehicles? :shrug:

[tammywammy]

7. No, not a discount at the auction

It depends on what type of vehicle is traded in. Many dealers wholesale (or auction) off vehicles because they aren't good trades, i.e. too many miles, needs too much work, etc. The dealer makes more money wholesaling them than doing work and then having a car on the lot that you can't sell.

The auctions are where the trade-in values for Kelly Blue Book, Edmunds (and all the various other used car value books) comes from.

[Atman]

8. It because they build crappy cars no one wants to buy!

:eyes:

.