[TODAY'S TOP STORIES] from [The Japan Times]
[BUSINESS NEWS]
Tuesday, May 19, 2009
Toyota debuts new Prius hybrid
By HIROKO NAKATA
Staff writer
Toyota Motor Corp. on Monday launched its much-awaited new Prius gasoline-electric hybrid to face off against rival Honda Motor Co.'s Insight hybrid released in February.
Officially priced, as expected, at 2.05 million, the new Prius has already sparked a flurry of buy orders. The previous model, equipped with a less powerful engine, carried a 2.33 million price tag.
Despite the economic slump, Toyota said it has received orders for more than 80,000 units, compared with the 18,000 orders Honda received for the Insight in its first month.
Toyota's strategy to slash the price of the remodeled third-generation Prius is paying off, experts say, noting the sticker price is now closer to the Insight's, which grabbed consumer attention with a price of 1.89 million.
"We will provide what is good for society and the people at a price that many customers feel like paying," Akio Toyoda, the incoming Toyota president, told a news conference at the company's Mega Web showroom in Koto Ward, Tokyo.
Toyoda, grandson of the automaker's founder, is currently an executive vice president.
"I want more people to feel comfortable buying a Prius," he said, adding that all of Toyota's 4,900 outlets nationwide will sell the new Prius and provide followup service.
The Prius will soon debut in more than 80 countries, including in North America and other parts of Asia later this month, Europe in June, and Central and South America, Africa, Oceania and the Middle East in July. Toyoda said the company expects sales of 500,000 to 600,000 units of all its hybrid models for the year.
So far, 1.25 million units of the first two Prius models have been sold in more than 40 countries since 1997.
The car giant also announced Monday it will lower the price of the older Prius to 1.89 million, the same as the standard Insight model, mainly targeting corporate clients.
Competition between the Prius and Insight is the only bright spot amid the global consumption slump and the crisis facing U.S. rivals General Motors Corp. and Chrysler LLC.
New tax incentives introduced in April to further promote eco-friendly vehicles are adding fuel to the sales. The new and existing incentives lower the taxes by 164,000 to 216,000 for the new Prius, Toyota said.
[BUSINESS NEWS]
Tuesday, May 19, 2009
U.S. makers take cue from Toyota in cutting dealers
By KATIE MERX and KEITH NAUGHTON
(Bloomberg) General Motors and Chrysler, borrowing from Toyota's playbook, are betting they can sell more cars with fewer dealerships.
Plans announced last week to shed almost 2,000 retail outlets are designed to bolster the survivors, GM and Chrysler said. Reducing competition from stores with the same brands is supposed to allow the remainder to boost prices and profit, and to reinvest in their businesses to keep adding customers.
That echoes the strategy of Toyota in growing to second behind GM in U.S. market share. U.S. outlets for Toyota and Honda Motor Co. each averaged more than 1,100 sales in 2008, almost three times as many as GM's and Chrysler's, consulting firm Grant Thornton found.
"There's the school of thought that if they want to emulate the success of brands like Toyota and Honda they should emulate their dealer structure," said Jack Nerad, an analyst for car-pricing company Kelley Blue Book in California. "That certainly seems to be the view of the automotive task force."
Nerad was referring to U.S. President Barack Obama's car task force, which steered Chrysler into bankruptcy April 30 and set a June 1 deadline for GM to finish restructuring outside of court. The panel said it wasn't involved in the dealer cuts.
GM is paring domestic dealers to a range of 3,600 to 4,000 from 5,969 by the end of 2010. On May 15, it notified about 1,130 retailers that their franchise accords won't be renewed, meaning they would stop selling cars in a year and won't be able to order new inventory. A day earlier, Chrysler told 789 outlets they would stop selling cars by June 9.
Dumping dealers isn't part of the cuts in costs and debt at GM and Chrysler. Instead, "underperforming" stores, as GM put it, were targeted to ensure the automakers' future retail networks will be stronger for when the companies reorganize.
GM's U.S. dealers sold 2.9 million vehicles in 2008, while the total for Chrysler's 3,188 stores was 1.5 million. Toyota had 2.2 million sales at 1,459 U.S. dealers.
"The strategy at Toyota is pretty simple: keep the dealer count rational, don't locate them too close to each other and maximize their units per outlet," said Mike Michels, a company spokesman in California. "A profitable dealer can invest in their dealership and personnel."
Average new-auto revenue was $14.3 million for GM dealers and $12.8 million for Chrysler last year, compared with $40.9 million for Toyota, based on data from auto-research company Edmunds.com.
Dealers also make money on used vehicles, parts and service.
Each GM store averaged 444 new-auto sales, while Chrysler had 405, according to consulting firm Grant Thornton. Ford was similar, at 483. Japan's three biggest automakers dwarfed those totals, with 1,200 for Toyota, 1,150 for Honda and 764 for Nissan, Grant Thornton found.
Shrinking GM's dealer ranks to about 3,600 would push the automaker's retailers to an annual average of 750 sales, said Paul Melville, a Grant Thornton auto-retailing analyst in Michigan.
"It's heading in the right direction, but it's still only 65 percent of where Toyota is," Melville said. "They'll still have a lot of low-volume stores."
Mark LaNeve, GM's North American sales chief, said the dealer cuts are needed to match the shrinkage in the company and in the U.S. auto market. GM plans to dispose of Hummer, Saturn and Saab and will end the Pontiac brand to focus on Chevrolet, Cadillac, Buick and GMC vehicles.
"Too many dealers, in actuality, is not the problem," LaNeve said Friday. "We've got too little industry and too little sales we have to contend with."
Chrysler President Jim Press said Thursday that "a powerful new dealer body" would be a pivotal part of the automaker's restructuring, which includes an alliance with Italy's Fiat SpA.
GM and Chrysler may never match per-store sales with Toyota or Honda because the U.S. automakers have more dealers in rural areas, where profitable pickups are top sellers. Toyota's dealer network is concentrated in urban and suburban areas.
That means the focus must be on cutting overlapping stores in urban areas, where dealers tend to compete with each other by cutting prices rather than winning business from other automakers, said Melville, the Grant Thornton analyst.
Among those stung by the practice is Gordon Stewart, who owns a Toyota dealership in Alabama and Chevrolet outlets in Georgia, Florida and Michigan. His Michigan Chevrolet store competes with 45 others for the brand in metropolitan Detroit.
Price wars drain much of GM dealers' profits, leaving little money left to market autos to new buyers, said Stewart, who wasn't on GM's cuts list last week and backs the efforts to thin the dealers' ranks.
"Imagine how much money we could spend advertising if we had the whole market area to ourselves," Stewart said. "Right now, you've got so many weak dealers in the market area that nobody can afford to promote."
[BUSINESS NEWS]
Tuesday, May 19, 2009
Average monthly overtime at manufacturers sank 18.7% in '08; wages also fell
(Kyodo News) Average monthly overtime hours worked per capita among manufacturers declined 18.7 percent in fiscal 2008 from the previous year, down for the first time in seven years and posting the largest drop in 16 years, the government said Monday.
Average monthly overtime hours worked, a key gauge of economic outlook, came to 13.4 hours for manufacturers in the year ended March 31, the Health, Labor and Welfare Ministry said.
Average monthly overtime hours shrank from the previous year due to the economic downturn, a ministry official said.
Average monthly wages at companies in all sectors slipped 1.1 percent to 328,990 for the second consecutive yearly fall, due mainly to a sharp drop in nonregular wages such as overtime pay.
Average monthly regular pay, such as basic salary, stood at 249,976, down 0.4 percent.
Inflation-adjusted real average monthly wages dropped 2.3 percent for the third straight year of decline, the ministry said.
[BUSINESS NEWS]
Tuesday, May 19, 2009
Toyota debuts new Prius hybrid
By HIROKO NAKATA
Staff writer
Toyota Motor Corp. on Monday launched its much-awaited new Prius gasoline-electric hybrid to face off against rival Honda Motor Co.'s Insight hybrid released in February.
Officially priced, as expected, at 2.05 million, the new Prius has already sparked a flurry of buy orders. The previous model, equipped with a less powerful engine, carried a 2.33 million price tag.
Despite the economic slump, Toyota said it has received orders for more than 80,000 units, compared with the 18,000 orders Honda received for the Insight in its first month.
Toyota's strategy to slash the price of the remodeled third-generation Prius is paying off, experts say, noting the sticker price is now closer to the Insight's, which grabbed consumer attention with a price of 1.89 million.
"We will provide what is good for society and the people at a price that many customers feel like paying," Akio Toyoda, the incoming Toyota president, told a news conference at the company's Mega Web showroom in Koto Ward, Tokyo.
Toyoda, grandson of the automaker's founder, is currently an executive vice president.
"I want more people to feel comfortable buying a Prius," he said, adding that all of Toyota's 4,900 outlets nationwide will sell the new Prius and provide followup service.
The Prius will soon debut in more than 80 countries, including in North America and other parts of Asia later this month, Europe in June, and Central and South America, Africa, Oceania and the Middle East in July. Toyoda said the company expects sales of 500,000 to 600,000 units of all its hybrid models for the year.
So far, 1.25 million units of the first two Prius models have been sold in more than 40 countries since 1997.
The car giant also announced Monday it will lower the price of the older Prius to 1.89 million, the same as the standard Insight model, mainly targeting corporate clients.
Competition between the Prius and Insight is the only bright spot amid the global consumption slump and the crisis facing U.S. rivals General Motors Corp. and Chrysler LLC.
New tax incentives introduced in April to further promote eco-friendly vehicles are adding fuel to the sales. The new and existing incentives lower the taxes by 164,000 to 216,000 for the new Prius, Toyota said.
[BUSINESS NEWS]
Tuesday, May 19, 2009
U.S. makers take cue from Toyota in cutting dealers
By KATIE MERX and KEITH NAUGHTON
(Bloomberg) General Motors and Chrysler, borrowing from Toyota's playbook, are betting they can sell more cars with fewer dealerships.
Plans announced last week to shed almost 2,000 retail outlets are designed to bolster the survivors, GM and Chrysler said. Reducing competition from stores with the same brands is supposed to allow the remainder to boost prices and profit, and to reinvest in their businesses to keep adding customers.
That echoes the strategy of Toyota in growing to second behind GM in U.S. market share. U.S. outlets for Toyota and Honda Motor Co. each averaged more than 1,100 sales in 2008, almost three times as many as GM's and Chrysler's, consulting firm Grant Thornton found.
"There's the school of thought that if they want to emulate the success of brands like Toyota and Honda they should emulate their dealer structure," said Jack Nerad, an analyst for car-pricing company Kelley Blue Book in California. "That certainly seems to be the view of the automotive task force."
Nerad was referring to U.S. President Barack Obama's car task force, which steered Chrysler into bankruptcy April 30 and set a June 1 deadline for GM to finish restructuring outside of court. The panel said it wasn't involved in the dealer cuts.
GM is paring domestic dealers to a range of 3,600 to 4,000 from 5,969 by the end of 2010. On May 15, it notified about 1,130 retailers that their franchise accords won't be renewed, meaning they would stop selling cars in a year and won't be able to order new inventory. A day earlier, Chrysler told 789 outlets they would stop selling cars by June 9.
Dumping dealers isn't part of the cuts in costs and debt at GM and Chrysler. Instead, "underperforming" stores, as GM put it, were targeted to ensure the automakers' future retail networks will be stronger for when the companies reorganize.
GM's U.S. dealers sold 2.9 million vehicles in 2008, while the total for Chrysler's 3,188 stores was 1.5 million. Toyota had 2.2 million sales at 1,459 U.S. dealers.
"The strategy at Toyota is pretty simple: keep the dealer count rational, don't locate them too close to each other and maximize their units per outlet," said Mike Michels, a company spokesman in California. "A profitable dealer can invest in their dealership and personnel."
Average new-auto revenue was $14.3 million for GM dealers and $12.8 million for Chrysler last year, compared with $40.9 million for Toyota, based on data from auto-research company Edmunds.com.
Dealers also make money on used vehicles, parts and service.
Each GM store averaged 444 new-auto sales, while Chrysler had 405, according to consulting firm Grant Thornton. Ford was similar, at 483. Japan's three biggest automakers dwarfed those totals, with 1,200 for Toyota, 1,150 for Honda and 764 for Nissan, Grant Thornton found.
Shrinking GM's dealer ranks to about 3,600 would push the automaker's retailers to an annual average of 750 sales, said Paul Melville, a Grant Thornton auto-retailing analyst in Michigan.
"It's heading in the right direction, but it's still only 65 percent of where Toyota is," Melville said. "They'll still have a lot of low-volume stores."
Mark LaNeve, GM's North American sales chief, said the dealer cuts are needed to match the shrinkage in the company and in the U.S. auto market. GM plans to dispose of Hummer, Saturn and Saab and will end the Pontiac brand to focus on Chevrolet, Cadillac, Buick and GMC vehicles.
"Too many dealers, in actuality, is not the problem," LaNeve said Friday. "We've got too little industry and too little sales we have to contend with."
Chrysler President Jim Press said Thursday that "a powerful new dealer body" would be a pivotal part of the automaker's restructuring, which includes an alliance with Italy's Fiat SpA.
GM and Chrysler may never match per-store sales with Toyota or Honda because the U.S. automakers have more dealers in rural areas, where profitable pickups are top sellers. Toyota's dealer network is concentrated in urban and suburban areas.
That means the focus must be on cutting overlapping stores in urban areas, where dealers tend to compete with each other by cutting prices rather than winning business from other automakers, said Melville, the Grant Thornton analyst.
Among those stung by the practice is Gordon Stewart, who owns a Toyota dealership in Alabama and Chevrolet outlets in Georgia, Florida and Michigan. His Michigan Chevrolet store competes with 45 others for the brand in metropolitan Detroit.
Price wars drain much of GM dealers' profits, leaving little money left to market autos to new buyers, said Stewart, who wasn't on GM's cuts list last week and backs the efforts to thin the dealers' ranks.
"Imagine how much money we could spend advertising if we had the whole market area to ourselves," Stewart said. "Right now, you've got so many weak dealers in the market area that nobody can afford to promote."
[BUSINESS NEWS]
Tuesday, May 19, 2009
Average monthly overtime at manufacturers sank 18.7% in '08; wages also fell
(Kyodo News) Average monthly overtime hours worked per capita among manufacturers declined 18.7 percent in fiscal 2008 from the previous year, down for the first time in seven years and posting the largest drop in 16 years, the government said Monday.
Average monthly overtime hours worked, a key gauge of economic outlook, came to 13.4 hours for manufacturers in the year ended March 31, the Health, Labor and Welfare Ministry said.
Average monthly overtime hours shrank from the previous year due to the economic downturn, a ministry official said.
Average monthly wages at companies in all sectors slipped 1.1 percent to 328,990 for the second consecutive yearly fall, due mainly to a sharp drop in nonregular wages such as overtime pay.
Average monthly regular pay, such as basic salary, stood at 249,976, down 0.4 percent.
Inflation-adjusted real average monthly wages dropped 2.3 percent for the third straight year of decline, the ministry said.
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