Handling a Downturn the Toyota Way

it aint nickle and diming that is the problem, its all the people that made a TON (ya know the ones we are bailiing out now?) and then were willing to pay too much for nothing because they made a lot of money from nothing.

this basically raised the bar for cost of living for EVERYONE but only a small few were actually making the money necessary to support this. this caused the middle class who, before this, made enough to afford a decent living, to no longer be able to afford what they were accustomed too.

well, they were unable to accept that and the same people who were making the money (ya know the bailout people??) came out with this device called CREDIT...where they give you a little money but charge A LOT of money for that privillage.

now the rich were getting richer off the backs of the middle class... now the middle class no longer has the money to pay what they got on credit and our economy is collapsing. and now the select rich can no longer afford to heat their 10,000 sq ft mansions, so now we have to pay for them to keep their toes warm...

that is the problem

 

The middle class and the wealth that was created by it is gone. The governments will be the next wave of collapse. Real wealth has not been created in this country for 35 years. Yes there have been various bubbles that people who bought and sold the bubble at the right time were able to profit. We have all been sold a bill of goods. "You are better off if you drive a foreign car, if all your electornics are made in Asia, if the plane you fly on is made in europe, if you buy cheaper foreign-made goods @ Wal-Mart, it does not matter". What a lie.

 

malorn, i cant fault your ideals. you are like the father an accused murderer... you will defend your son at all costs, sacrificing everything you have even if deep down, you know he is probably guilty.

 

Dave, what do yo do for a living if i amy ask? Do you think the tade problem has any effect on you and your family?

 

no, it doesnt... as a matter of fact, i work for an outsourcing company that has several overseas offices (ya a bunch in India too!!)

do i feel guilty taking jobs away from Americans??...no i dont... what my company provides, is computer support be it tech, data processing or other backend tasks, mostly supporting their customer service department, finance department or record archiving duties, so THEY DONT HAVE TO LOOK AT CHEAPER OFF SHORE ALTERNATIVES.

iow, a company that understands CURRENT NEEDS... has no ties to "the ole boy network", etc...

now, that was not always true. i worked for years for Weyerhaeuser Paper Company. it was a great paying blue collar union job. but the cost of running the business outweighed the benefit to the corporation, so it was sold. now, its a non union shop, paying less money and with less benefits.

but the corporation still exists today...smaller, yes; less diversified, yes; better able to concentrate on their speciality which was maintaining a sustained wood products and forestry company ....most definitely a resounding YES

iow, they were a company in trouble who knew what had to be done and did it, and it was painful. the Paper products division employed 18,000 people at the corporate level. they all lost their jobs, but it allowed Weyerhaeuser to keep another 55,000 working

so now we have two companies, both nationally recognized as pillars of the manufacturing fabric of this nation. one is wounded but recovering, the other comatose...why has one taken on the steps needed to insure its long term survival, while the other has not?

but back to what i do... its hard to understand how my company operates simply because it has no established jobs, work, etc...we run from one short term contract to another with over 10,000 different companies doing over 10,000 different tasks. we get a job, learn to do it and then man it.

when i first started working there, i probably changed jobs at least a dozen times. we have a job for 6 weeks, then it goes away, we get a crash course on doing something else, and start doing it until it goes away...

old customers we dont work for any more, Citigroup was a biggie. when they dropped us, that caused 150 people at my office to either accept a transfer to Portland, OR or get another job. so ya, we knew Citigroup was on its way out a long time ago... in fact, we know a lot about a lot of companies and i can t even tell you how bad i wanted to say something but couldnt due to our non-disclosure agreement.

but the point is, in today's world you survive by having customers, and you keep customers by providing what they need... its a global economy so the competition is coming from every corner...

 

I am in no way trying to attack you personally, but why did weyerhauser have to dwonsize, where did the pressure come form, I am not at all familiar with the paper/logging industry? Was it foreign competition?

As for your job today, what happens when your company or whoever it serves decides that they have to offshore? Then what do you move onto? Maybe that will not happen but if the next 20 years are like the last 20 years it will.

Again i am not trying to attack you, but when does the offshoring, the movement of jobs, capital, and the wealth of the USA stop?

 

i added to post but the paper industry is being over run by cheaper competition, lower paper prices, etc... i knew a guy who made a living on recycling... he having a hard time of it because his biggest money maker was paper, but he is getting less than 25 cent on a dollar now as compared to two years ago simply because the recycled paper market is flooded...

companies are cutting costs so they are going to cheaper boxes, Weyerhaeuser Paper centered on the high end market, glossy screen prints, 4 color wine boxes, iow, higher quality, higher profit margins, etc. now, the packaging is less important (well not actually but with tight money, the options to go the "extra mile" is simply not there)

anyway, i got out years before the issues arose, so its a non issue as far as my personal life and i havent heard anything about it affecting my pension so...

 

It's a global economy in some ways and in some ways it is not. I know the auto sector and it is not a global economy when it comes to importing US or German-made autos into Japan or importing US or German made vehicles into China. If you want to enter into the Chinese market, you must partner with a Chinese firm and souce and buld the vehicles in China. If a chinese or Japanese made vehicle is imported into the United States there are no barriers--is that a global economy or free trade or even fair trade. that is the auto industry but it is happening in every industry.

 

Hello Dave, It sounds like you have the sort of job that requires you to be on your toes all the time, that's something that Detroit forgot! As an aside, while I was stationed in Germany I had some groceries in a bag on the floor of my Peugeot and the manager of Peugeot happened to see the name on the milk carton, "Weyerhaeuser" and asked me about it. I told him it was a big Lumber company on the West Coast that made various paper products, like the milk carton! The interesting thing about it is, he was a native German from Mainz and had never seen the name anywhere in his local. His name? "Weyerhaeuser" which the Germans pronounce Vierhoiser, as in oy yoi yoi. Any idea of the roots of the entrepreneur??:cheer2:

 

Sounds kind of funny, coming from a fan of GM ... the company that "waves" the U.S flag, over its Mexican, Canadian, and Chinese made products, shuts down its U.S. factories, choosing to outsource instead of investing in the future, like it should have done ... instead of crushing its EV1. Then buying Hummer. When I think of the hundreds of millions GM spent on lobbyists to overturn the EV1, and then to buy the hummer line? Now THERE'S a pile of money that could keep GM's unemployment benefits flowing.

But the article is about how & why Toyota is successful in the midst of hard times. Rather than take a lesson, the GM way is, in stead, to bash the example of success. That's the difference between the 2 business models. So carry on, and bash away ... the GM way.

 

Hill you continually deal in the mythology of the US auto industry. Does GM build cars in canada and Mexico, yes but if they only built cars in canada and mexico would there be anyway the US could lose 3,000,000 jobs in the span of a couple of months. Look at the facts for a change and stop concentrating on the midgets and giants of the industry. Gm has more than 60 manufacturing facilities in 16 states.
As far as toyota, they will lose several billion dollars in the 4th qtr and will be retrenching all over the world.

 

Hill,

Do you live in a different world? You continually go on about GM and the EV1. Some questions:

Did Toyota fight the CARB EV Mandate?
Answer: Yes, along with every other manufacturer

What did Toyota do after the EV mandate was repealed?
Answer: They discontinued their EV program THE DAY AFTER. Then they started crushing their EV's as they came off lease. They only discontinued crushing when the bad publicity from dontcrush.com got too bad.

Did Toyota fight the recent CAFE increase?
Answer: Yes, with every other manufacturer. The only exception was Honda

What was Toyota's latest major investment the the US?
Answer: A plant in Texas to build the Tundra and Sequoia. Both huge gas-guzzling vehicles on par with Hummer products.

 

Focusing on "well, Toyota does bad too" does not address the issue ... and the issue here is GM. When our 5 year old children give this kind of alabi, "well Tommy hit me first" we teach them proper behavior. We teach that we ALL have to face consequences. We don't teach, "oh, he hit first? well then it's ok" ... right? GM is facing the consequences ... and no amount of, "well toyota is bad too" will fix GM. That's the world I live in ... and it's the world GM, Toyota, and hopefully every one else lives in ... the world of consequences ... good, bad, or neutral .

GM (instead of fixing their self) will focus on Toyota losing billions, rather than the 10 billion that they will likely still make. So again, nothing at GM ever changes. GM'ers still focus on others being their problem. Malorn spoke recently about the 1930's depression, recession, Germany, millions dying etc ... trying to say that if the U.S. doesn't bail out GM, that's possibly what will happen again. Fact is that the Nazi government came to power (as stated by the eighteenth century Irish philosopher and political theorist, Edmund Burke) because the majority of good men stood by and did nothing while the minority of evil took over. So why should the U.S. bail out a failed GM that offers no potential to change? ... only rhetoric & fear, that "if you don't give money, everything will be bad". It will likely be bad anyways. so to give billions, AND face hard times, that would only compound the issue.

 

So you think toyota will make money in the 4th qtr? Any avatar bet on that? too bad you have so much disdain for Detroit. Will China and Japan fund your retirement?

 

What Toyota is doing is very valid. You continually say in this thread and others that GM deserves to fail because they killed the EV, focused on trucks and SUV's, and build hybrid SUV's instead of a Prius. If those are the criteria than Toyota deserves to fail as well because they did the exact same things with the exception of the Prius.

People here on PriusChat seem to buy the Toyota greenwash that Toyota is a green company because they build the Prius. The Prius is one model with limited sales. All hybrid sales combined are less than 3% of total auto sales. GM would not have suddenly become a profitable even if they had built a hybrid mid-sized car.

 

I don't consider over 1,000,000 Prius sales limited. I don't consider Toyota faultless. BTW, it's not just the Prius that Toyota was successful at. The Camry is a heck of a great hybrid as well ... and according to Toyota, there's a lot more models to come. I hope GM DOES succeed with the Volt. It's discouraging that the Volt only came about (at least the concept) though, because SUV marketing failed (via high gas prices). Toyota is in better shape, simply because of better planning. Good planing is the first part of the recipe for success.

Will toyota 'succeed' in the 4th quarter? By their own reduced forcasts, they won't do as well as previously predicted. Even so, sales are projected in the billions. Again though, the thread is "handling a downturn the Toyota way". Thankfully, at least Toyota hasn't (as badly) screwed their self over the way other manufacturers have done. But businesses have to 'man up' and face the music. No one wants to see ANY one or business fail. But when failure come due in great part because of folly ~ face the music and move on.

 

While Toyota sold those 1,000,000 priuses over the last 10 years, what did they sell world-wide? about 70,000,000 units? Priuses are hardly a large percentage of even toyota's sales. Time to stop seeing the world through toyota-issued green blinders.
Toyota sold more full-size trucks during the same time and if given the same opportunity do you think they would have not sold just as many trucks as ford and GM? Stop kidding your self. Gm and Toyota are roughly the same companies, other than the Prius and the fact toyota has a closed home market and they benefit from an industrial policy which has ensured their growth.

toyota will lose several billion dollars over the next 13 months and i predict lose their stomach for expansion in the US market.

If toyota wasin trouble financially would theJapanese govt be having hearing in front of the world deciding to help them? Get real.

 

That's right, keep telling yourself that the only reason that Toyota is successful is because of government and trade policies. The fact is that GM and Toyota are not the same company, as evidenced by Toyota's attempt at diversification of their product line. Toyota started R&Ding the Prius while GM was laughing at them and no one thought hybrids were realistic. Now Toyota has 3 hybrid models, to which GM has no competition.

Toyota isn't blind to the high margin vehicles, so the fact that they continue to also have a solid share of trucks and SUVs doesn't make them evil. Maybe a little less good to many of us, but still not the cause of all of America's ills. Toyota doesn't make perfect decisions and GM doesn't always make bad decisions. However, the longer you (and other GM affiliates and apologists) keep up these rationalizations (read: rational lies) to justify their struggles, the longer it is going to take to solve the problem.

Year after year, you continue to come on here and tout the same arguments, while GM continues to go down the toilet. Time to ask yourself how it is working for you (and for GM). It really is a sad reflection of what the GM execs have been doing.

 

all these arguments could be easily settled if we knew what the profit margin was on each vehicle... a lot of this discussion is really based on the validity of the actions of each company.

is Toyota only really successful because of government intervention and help or is Toyota's product line the main reason for its success?

or, would it be because GM dug its own grave with its foot in mouth tactics (learned from the tobacco and oil industries) downplaying the EV's and hybrids along with its inability to effectively manage its labor agreements?

well, Ford is by no means out of the woods, but they seem to be much better off. they have the same labor agreement (i have an uncle who worked as a millwright for Ford in Mt. Clemens, Michigan for 37 years. his retirement is beyond belief) along with is legacy retirement community draining them as well. but they embraced hybrids well enough to have the industry leading small hybrid SUV along with others soon to be released.

iow, no one was fooled by GM's lip service to hybrid technology when the released the Malibu "hybrid" sic.

GM continues to this very day STILL without a viable high mileage vehicle in its fleet be it hybrid, diesel, EV, etc. and let me stop you all in your tracks.... for some reason, some ad exec thinking we were stupid enough to go along with it, just because they said so, selected 30 MPG as the golden parachute. sorry, that does not qualify as "high mileage". if its an SUV or pickup, sure then it would but standard passenger cars?? no way... 30 MPG is AVERAGE, nothing more

 

My dealer says the 2010 Prius is due in next summer and will not be a plug-in.

I fault Washington more than the car companies for the current situation. For not raising mpg and emissions standards for 30 years, for exempting SUVs and light trucks from mpg rules due to "commercial" use ( a big joke), and for allowing oil futures and gas prices to become speculative. No leadership there.

The American car companies are more vulnerable because they are not as well managed as the foreign companies, and their net return over the years has not justified generous union benefits which have now been cut back.
Management has also been overly greedy in rewarding itself.

In fact, excessive greed is at the root of our problems right now--and Obama needs to make that point. The balance needs to be shifted from consumption to conservation.