REPORT: Toyota Financial seeking loans from Japanese gov't

Jeremy Korzeniewski — Tue, 03 Mar 2009 11:40:00 EST

Filed under: Government/Legal, Toyota, Earnings/Financials

LR: Toyota Vice Chairman Katsuaki Watanabe, Toyota President Akio Toyoda and Chairman Fujio Cho

Toyota Financial Services has reportedly applied for loans equaling $2 billion (200 billion yen) from the state-backed Japan Bank for International Cooperation. Much of these funds would presumably be used to lend money to new car buyers in the United States, Toyota's largest and most profitable market. If granted, Toyota would join American automakers General Motors and Chrysler on the bailout bandwagon.

Last month, Toyota sold roughly $2 billion (200 billion yen) worth of 10-year bonds at rates much less favorable than what the automaker had previously been accustomed to. That and the aforementioned loan request are actions likely taken to shore up Toyota's falling cash reserves, which some have estimated to be as low as $18.5 billion at the end of January.

It's widely expected that Toyota will post a net loss of as much as $3.5 billion (350 billion yen) for the fiscal year ending in March. This would be the Japanese automaker's first ever operating loss for a full 12-month period, and it further proves how dire the current economic conditions are for all around the globe. Thanks to all who sent this in!

[Source: Bloomberg | Photo by Junko Kimura/Getty]

REPORT: Toyota Financial seeking loans from Japanese gov't originally appeared on Autoblog on Tue, 03 Mar 2009 11:40:00 EST. Please see our terms for use of feeds.

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Toyota supports Detroit 3's pleas for bailout bucks

Jeremy Korzeniewski — Tue, 16 Dec 2008 13:29:00 EST

Filed under: Government/Legal, Hirings/Firings/Layoffs, Toyota, Earnings/Financials

Toyota doesn't want one of the Detroit 3 to fail. Despite the fact that the Japanese automaker is a direct competitor and seemingly stands to gain long-term sales from the collapse of at least one of its American competitors, the reality is that it would be a major headache for the entire industry. The largest issue may be that a Detroit collapse, especially of General Motors, would take a number of key suppliers down with it -- suppliers that Toyota relies upon just as much as any other automaker.

Toyota, Honda and Nissan all call the U.S. market their largest, so these import car companies require the American economy to remain strong in order to keep sales figures and profits relatively healthy. The loss of hundreds of thousands -- if not millions -- of jobs would be a major blow to the already struggling U.S. economy and could also cause additional import backlash.

The last potential problem facing the Japanese automakers is a possible takeover of an American automaker by another competitor, likely from China or India, that could flood the market with low-cost cars. The last successful influx of competition came from Korea in the form of Hyundai and Kia, and Toyota isn't looking forward to losing market share to another set of automakers any sooner than necessary.

[Source: CNN Money]

Toyota supports Detroit 3's pleas for bailout bucks originally appeared on Autoblog on Tue, 16 Dec 2008 13:29:00 EST. Please see our terms for use of feeds.

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