TOKYO– Toyota Motor Corp. said no details had been decided after reports that its auto loan unit, Toyota Financial Services, had asked for a 200 billion yen ($2.62 billion Canadian) government loan.
A spokesperson for Toyota Financial Services said the talks with the Japan Bank for International Co-operation were among the various ways being studied to gain funding. The lender does 70 per cent of its business in the U.S., where sales have been plunging and credit tightening.
Toyota, which makes the Camry sedan and the Prius hybrid, had been growing solidly before the U.S. financial crisis hit last year.
But now Toyota is expecting a 350 billion yen loss for the fiscal year that runs through March as plunging global demand and a strengthening yen batter earnings.
Toyota's projected red ink for the fiscal year would mark its first such annual net loss since 1950, and a sharp contrast from the record 1.72 trillion yen profit it racked up the previous year.
Toyota is still faring better than General Motors and Chrysler, which together have received $17.4 billion (U.S.) in emergency loans from the U.S. government, and asked for an additional $21.6 billion in aid last month.
Nissan Motor Co. has said it is considering various types of government aid, but it declined to say whether it had asked the Japan Bank for International Cooperation for loans.
Yeah, that's how bad things have gotten. Though, would anyone happen to know what the balance sheet of Toyota Financial looks like? Did they engage in any of the same dodgy lending practices that are now biting so many other lenders in the ass? (and as the article notes, TFS does 70% of it's business in the US)
The M2HB: The Greatest Machinegun Ever Made.
HAB: Crew-Served Weapons Specialist
"Making fun of born-again Christians is like hunting dairy cows with a high powered rifle and scope." --P.J. O'Rourke
"A man who has nothing for which he is willing to fight, nothing which is more important than his own personal safety, is a miserable creature and has no chance of being free unless made and kept so by the exertions of better men than himself." --J.S. Mill
Ma Deuce wrote:
Yeah, that's how bad things have gotten. Though, would anyone happen to know what the balance sheet of Toyota Financial looks like? Did they engage in any of the same dodgy lending practices that are now biting so many other lenders in the ass? (and as the article notes, TFS does 70% of it's business in the US)
Even if Toyota has a perfect balance sheet, it doesn't matter. The whole financial world is extremely inter-linked and if the industry is going to collapse you will be dragged along with it.
Letting the 'bad' or failing company fall apart only works when that company is not going to drag the rest of the industry down with it.
Humans are such funny creatures. We are selfish about selflessness, yet we can love something so much that we can hate something.
ray245 wrote:Even if Toyota has a perfect balance sheet, it doesn't matter. The whole financial world is extremely inter-linked and if the industry is going to collapse you will be dragged along with it.
Letting the 'bad' or failing company fall apart only works when that company is not going to drag the rest of the industry down with it.
Erm, no. You are confusing conditions that drag everyone down, versus, making very bad decisions, just because everyone else is making them.
You might like to know that Standard Chartered is doing fairly well vis a vis the rest of the financial world, because they chose to be smart about their investments.
STGOD: Byzantine Empire Your spirit, diseased as it is, refuses to allow you to give up, no matter what threats you face... and whatever wreckage you leave behind you.
Kreia
ray245 wrote:Even if Toyota has a perfect balance sheet, it doesn't matter. The whole financial world is extremely inter-linked and if the industry is going to collapse you will be dragged along with it.
Letting the 'bad' or failing company fall apart only works when that company is not going to drag the rest of the industry down with it.
Erm, no. You are confusing conditions that drag everyone down, versus, making very bad decisions, just because everyone else is making them.
You might like to know that Standard Chartered is doing fairly well vis a vis the rest of the financial world, because they chose to be smart about their investments.
Ah, my mistake.
However, if there is no sight of recovery in the near future, the prospect of Standard Chartered will not look too good sooner or later.
Humans are such funny creatures. We are selfish about selflessness, yet we can love something so much that we can hate something.
Ma Deuce wrote:Though, would anyone happen to know what the balance sheet of Toyota Financial looks like? Did they engage in any of the same dodgy lending practices that are now biting so many other lenders in the ass? (and as the article notes, TFS does 70% of it's business in the US)
I did a quick skim over on their annual report (available here) and I don't see any red flags. Their charge-off & default rates are going up but still nowhere near where GMAC is for instance. They also have minimal involvement with mortgage & asset backed securities so the housing crash and credit crunch isn't going to kill them. The only area of concern is their derivatives holdings, most of which are based on interest rate & currency swaps, if we get big moves in the currency markets they could get hit for a sizable loss, but as far as I can tell they seem to have hedged their positions relatively well.
There's no ticking timebombs that I see on their balance sheets, they're just not clearing the volume needed to make a profit anymore since the auto industry is dead. If they downsize and/or restructure they should have no problems returning to profitability.
aerius: I'll vote for you if you sleep with me. Lusankya: Deal!
Say, do you want it to be a threesome with your wife? Or a foursome with your wife and sister-in-law? I'm up for either.
