Jeremy Hobson: Japanese car-maker Toyota said today its profit fell 18 percent last quarter. Sales plunged because of parts shortages, related to the March earthquake and tsunami.
And as Marketplace’s Jeff Tyler reports, the company’s future isn’t looking so great either because of more bad luck from mother nature.
Jeff Tyler: Last spring, the tsunami in Japan hurt Toyota’s ability to crank out new cars. Production had been picking up again when floods hit Thailand.
Jeremy Anwyl is CEO of Edmunds.com.
Jeremy Anwyl: Thailand is a major supplier of components. And the plants in Thailand have really been underwater now for about a month. So what that’s caused Toyota to do, particularly in the United States, is cut back on production.
The strong Japanese yen also works against Toyota. The dollars aren’t worth as much when converted into yen. Morningstar analyst David Whiston says compared to other Japanese car makers, the strong yen will hurt Toyota the most.
David Whiston: They are the most dependent on that yen-dollar exchange rate because, of the big three Japanese, they actually produce the most in Japan, compared to the other guys.
All the more incentive for Toyota to build cars in the U.S.
Good timing there: After several delays, Toyota is expected to begin production at a big new manufacturing plant in Mississippi later this month.
I’m Jeff Tyler for Marketplace.
As a nonprofit news organization, our future depends on listeners like you who believe in the power of public service journalism.
Your investment in Marketplace helps us remain paywall-free and ensures everyone has access to trustworthy, unbiased news and information, regardless of their ability to pay.
Donate today — in any amount — to become a Marketplace Investor. Now more than ever, your commitment makes a difference.