At one level, this news drives home the state of the global economy. But let’s parse the story a bit and see if there is contrast about how Toyota handles this vs. how their competitors do.
First, of course, is the “…since 1941” part, compared to the record losses that have been reported by the rest of the sector for many quarters now. This is the first time the leadership has had to report a loss.
Gloom dominated the annual news conference by Toyota’s president, who in recent years had outlined ambitious expansion plans. This year, even refused to give a worldwide vehicle sales goal for 2009.
“The tough times are hitting us far faster, wider and deeper than expected,” he told reporters at Toyota’s Nagoya office. “This is an unprecedented crisis requiring urgent action.” [emphasis added]
So what will they do about it?
Watanabe vowed Toyota would grow so lean it would realize profitability even if its worldwide sales slid to as low as 7 million vehicles — what he called the basic “bottom line” for Toyota.
“We must change to become more slim, muscular and flexible,” he said.
While I am certainly not inside anyone’s board room, here is what I am reading between the lines.
In Lansing (GM), the attitude is that external forces are causing an otherwise well managed company to suffer hard times. “We can’t do anything about this, it’s not our fault.”
In Nagoya (Toyota) the attitude is “If we had managed well enough, this would not have happened. We need to examine ourselves and do something about this so it doesn’t happen again.”
Of course the whole mess is fraught with U.S. politics which will complicate things immensely. But it will still be interesting to watch.
Oh – and, while they are certainly in trouble, I believe our friends in Dearborn (Ford) got off the denial train a while ago. Time will tell if it was soon enough for them.