Toyota: Small-Car Profits Key

Toyota iQ Concept

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May 11, 2009; The AIADA newsletter reported that the Detroit News reports that Toyota Motor Corp. is coping with recent financial losses with plans to focus on ways to make more money by selling small cars.

Company executives outlined their back-to-basics approach with a plan to begin formulating ways to produce small vehicles at a reduced expense, shifting Toyota's focus away from the production of larger vehicles like its Tundra pickup truck.

Last week, the company disclosed a $7.7 billion loss for the January to March quarter. For the fiscal year ended on March 31, Toyota lost $4.3 billion, its first annual loss since 1950 and a departure from its record $15 billion profit during the last fiscal year. However, some analysts predict that despite losses, Toyota is in far better shape than many give the company credit for, and will emerge from the downturn.

CNN Money reports that the Japanese automaker has a full tank of cash. And despite the losses, it added $8 billion to its coffers over the year, ending with $30 billion of cash and quickly-sellable assets on its balance sheet.

While the company must get used to a changing world, its cash, technology, and manufacturing expertise should see it through the crisis.

To read the full analysis of Toyota's plans to manufacture more small vehicles, click here.

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