Toyota: no meaning in being #1

[Jas29]

sorry for going off topic but do any of you know what the books name is that FenwickHockey65 mentioned

[8cd03gro]

Originally Posted by FenwickHockey65

The rest of the industry declined over a long period of time. Toyota went from the top of the world to near self-destruction in maybe a decade.

Simply put, Toyota wanted to be GM so badly that they ended up doing everything that led GM into the dumps. Just accelerated the process 50 times faster.

Bob Lutz's new book pointed out some very interesting tidbits about Toyota, especially their partnership with GM.

I disagree, big time. GM for example, posted it's highest profits ever, at that time, in '96-'97. The late 90s were great for GM. A decade later they go bankrupt. It was a plummet in sales and profitability into massive debt and liabilities. That very well may be the future of Toyota, but it's too early to tell.



Ford hit trouble a bit earlier on, but still had massive growth and all-time highs through the 90s followed by drops in sales and terrible troubles in the mid-00s.

[DGthe3]

Originally Posted by Jas29

sorry for going off topic but do any of you know what the books name is that FenwickHockey65 mentioned

Car Guys vs. Bean Counters: The Battle for the Soul of American Business

Originally Posted by 8cd03gro

I disagree, big time. GM for example, posted it's highest profits ever, at that time, in '96-'97. The late 90s were great for GM. A decade later they go bankrupt. It was a plummet in sales and profitability into massive debt and liabilities. That very well may be the future of Toyota, but it's too early to tell.



Ford hit trouble a bit earlier on, but still had massive growth and all-time highs through the 90s followed by drops in sales and terrible troubles in the mid-00s.

Selling a ton of trucks & SUV's can make a car company profitable, but that doesn't mean that the company is healthy.

[8cd03gro]

Originally Posted by DGthe3

Car Guys vs. Bean Counters: The Battle for the Soul of American Business


Selling a ton of trucks & SUV's can make a car company profitable, but that doesn't mean that the company is healthy.

Any way you want to twist it, GM went from their most successful years ever to bankruptcy in almost exactly a decade.

[formare]

Its called the rubber band effect. Companies that strive for uncontrolled growth quickly saturate the market and ultimately when the bills come due - you have no one buying as everyone has already bought. very sad really, this story keeps repeating itself starting from the first stacked stones by Romulus ans Remus.

[DGthe3]

Originally Posted by 8cd03gro

If highest profits and sales ever is unhealthy, I should start investing in Sony.

Depends how its done.

I'd say that a company with a diverse portfolio of excellent products, all of which make money for them, is healthy.

But selling SUV's to cover the losses of your small cars is not a healthy way to run a car company. Its even less healthy to be in a position where you are forced to sell cars at a loss, because it would cost even more to not sell them. Why? Well ... what happens when people stop buying those profitable SUV's? Whats the backup plan for when gas prices go up?

[8cd03gro]

Originally Posted by DGthe3

Depends how its done.

I'd say that a company with a diverse portfolio of excellent products, all of which make money for them, is healthy.

But selling SUV's to cover the losses of your small cars is not a healthy way to run a car company. Its even less healthy to be in a position where you are forced to sell cars at a loss, because it would cost even more to not sell them. Why? Well ... what happens when people stop buying those profitable SUV's? Whats the backup plan for when gas prices go up?

General Motors Deliveries in North America
Cars & Light Trucks
1996 1997
Buick 427,350 438,064
Cadillac 170,379 182,624
Chevrolet 2,541,773 2,484,945
GMC 424,416 423,215
Other-Isuzu 0 0
Hummer 0 0
Oldsmobil 331,287 304,759
Pontiac 551,107 608,623
Saab 28,439 28,447
Saturn 278,574 251,099
Total GM 4,753,325 4,721,776

Cars only 1996 1997
Buick 427,350 438,064
Cadillac 170,379 182,624
Chevrolet 1,045,172 980,554
Oldsmobil 306,486 251,663
Pontiac 529,710 556,662
Saab 28,439 28,447
Saturn 278,574 251,099
Total GM Cars 2,786,110 2,689,113

Trucks only 1996 1997
Buick 0 0
Cadillac 0 0
GMC 424,416 423,215
Chevrolet 1,496,601 1,504,391
Hummer 0 0
Other-Isuzu 0 0
Oldsmobil 24,801 53,096
Pontiac 21,397 51,961
Saab 0 0
Saturn 0 0
Total GM Light Trucks 1,967,215 2,032,663


Total Vehicle GM 4,753,325 4,721,776

Same figures from 04-05

2004 2005
309,639 282,288
234,217 235,002
2,763,238 2,669,932
602,064 566,322
15,707 15,787
29,345 56,727
28,851 1,866
474,179 437,806
38,159 38,343
212,017 213,657
4,707,416 4,517,730

Cars

2004 2005
223,329 186,140
141,948 160,859
917,887 866,212
20,417 1,400
419,962 395,312
38,159 36,071
123,497 105,927
1,885,199 1,751,921

Trucks

2004 2005
86,310 96,148
92,269 74,143
602,064 566,322
1,845,351 1,803,720
29,345 56,727
15,707 15,787
8,434 466
54,217 42,494
0 2,272
88,520 107,730
2,822,217 2,765,809


GM grew far more reliant on trucks and SUVs in the 00s than in the 90s. Far, far more. From financials, sales, management, all projections, etc. In every aspect, GM was extremely solid in the mid-late 90s, arguably more solid than ever.

[a_Username]

Originally Posted by DGthe3

Depends how its done.

I'd say that a company with a diverse portfolio of excellent products, all of which make money for them, is healthy.

But selling SUV's to cover the losses of your small cars is not a healthy way to run a car company. Its even less healthy to be in a position where you are forced to sell cars at a loss, because it would cost even more to not sell them. Why? Well ... what happens when people stop buying those profitable SUV's? Whats the backup plan for when gas prices go up?

You need to be blaming the management of GM's inability to recognize a changing market, considering GM was only selling these SUVs because of consumer demand at the time.

[8cd03gro]

Originally Posted by a_Username

You need to be blaming the management of GM's inability to recognize a changing market, considering GM was only selling these SUVs because of consumer demand at the time.

Exactly, the market demanded SUVs and trucks, and they delivered, but failed to prepare for the shift.

Anyway, we're getting way off topic which was not my intention. I was simply pointing out that Toyota is suffering similar to the rest of the market. It doesn't help that Japan just got blasted, by whatever god you may or may not think exists, from every direction. All the major players in Japan are suffering terribly. The new automotive threat is S Korea imo.

[FenwickHockey65]

Originally Posted by 8cd03gro

I disagree, big time. GM for example, posted it's highest profits ever, at that time, in '96-'97. The late 90s were great for GM. A decade later they go bankrupt. It was a plummet in sales and profitability into massive debt and liabilities. That very well may be the future of Toyota, but it's too early to tell.



Ford hit trouble a bit earlier on, but still had massive growth and all-time highs through the 90s followed by drops in sales and terrible troubles in the mid-00s.

The late 90s were good for GM simply because of high-profit truck/SUV sales. At the time, those were pretty much the only things GM was good at building. The car offerings were mediocre at best. The decline was already happening, in fact, it turns out that a good chunk of GM's profit was from GMAC, and near the time of bankruptcy, its ONLY profit was from GMAC.

Again, read Lutz's new book (for the guy who was asking, it's called "Car Guys vs Bean Counters"). GM might have had good sales and profit but the wheels of failure were already turning.

[rodscamaro]

Chevrolet is getting there, but I think the quality of their vehicles are just par. Even though I buy American, I sometimes wonder how the quality is on the other side. Especially considering how much a new car or suv cost.

[8cd03gro]

Originally Posted by FenwickHockey65

The late 90s were good for GM simply because of high-profit truck/SUV sales. At the time, those were pretty much the only things GM was good at building. The car offerings were mediocre at best. The decline was already happening, in fact, it turns out that a good chunk of GM's profit was from GMAC, and near the time of bankruptcy, its ONLY profit was from GMAC.

Again, read Lutz's new book (for the guy who was asking, it's called "Car Guys vs Bean Counters"). GM might have had good sales and profit but the wheels of failure were already turning.

I'm sure Lutz did push off as much of the blame as possible in his book. Funny enough, look at the 2011 YTD sales data. A much higher percentage of sales in 2010 and 2011(thus far), almost double in fact, were SUVs and light trucks than in the mid 90s, out of a far lower total sales figure. So GM must be less healthy, especially considering the market has shifted further toward small, efficient cars, right?

As of June 1, 2011

General Motors Corp. 1,046,275
Total Cars 438,409
Total Light Trucks 607,866

[hot_rod]

+1 to all of the above posts

Undeniable fact: Everything in existence tends to deteriorate.

Be it a living organism or an organization. Look up something like a listing of the top SP 500 companies say in 1987....how many exist today?

Write... Toyota off...um...Jim Womack's book "The Machine That Changed the World" first published in 1990.....wouldn't write them off just yet.

GM .....forget the government loan, last time I looked their stock price was well below their IPO.... so what's the equity stake (loss) to the taxpayers?

>wheels of failure were already turning.
Agreed, the big question is: are they still turning and what direction are they going?

Tom Peters was been writing about "Excellence" since 1982 and it's a moving target that evolves, something most organizations don't do very well or very quickly. Today's markets require change and it must be made very quickly.

[FenwickHockey65]

Originally Posted by rodscamaro

Chevrolet is getting there, but I think the quality of their vehicles are just par. Even though I buy American, I sometimes wonder how the quality is on the other side. Especially considering how much a new car or suv cost.

The quality on the other side of the Pacific is pretty much non-existent right now. Go to an auto show, sit in a Corolla, then sit in a Cruze. The fact that I went around a brand-new Sienna and pointed out numerous quality defects to a Toyota representative just shows how far they've sunk.

Originally Posted by 8cd03gro

I'm sure Lutz did push off as much of the blame as possible in his book. Funny enough, look at the 2011 YTD sales data. A much higher percentage of sales in 2010 and 2011(thus far), almost double in fact, were SUVs and light trucks than in the mid 90s, out of a far lower total sales figure. So GM must be less healthy, especially considering the market has shifted further toward small, efficient cars, right?

As of June 1, 2011

General Motors Corp. 1,046,275
Total Cars 438,409
Total Light Trucks 607,866

The point is that as of now, GM is making a profit on both trucks AND cars. The Impala and Malibu basically print money for GM at this point (which is why GM is so reluctant to redo the Impala, to my great irritation).

And anyone who expected light truck sales to drop is delusional. America will always need and want trucks.

But like someone said, depending on the profit from one product to cover the losses of another, in addition to relying on your finance arm for profit, does not make a healthy company.