Toyota May Cut Global Sales Goal to 9.5 Million Units
Toyota Motor may cut its 2008 global vehicle sales target by as much as 350,000 units to about 9.5 million because of declining sales in the United States, Japan and Europe, according to news reports.
The Nikkei reported in its Wednesday morning edition that Toyota plans to cut its global sales goal by 300,000 units to the lower 9.5 million level, while Kyodo News, citing a Toyota executive, said the automaker may cut its target by 350,000 units to 9.5 million.
Toyota will provide an update on its global sales target possibly next week, the executive, who was not identified, said, according to Kyodo.
"With slumps in Germany and other countries in Western Europe dragging on, growth in Russia is not enough to maintain our sales growth," a senior Toyota official said, according to The Nikkei.
A Toyota U.S. representative declined to confirm or deny the reports. Toyota is revising its worldwide sales estimate partly because sales in the United States, its largest market, are slipping at a faster rate than anticipated due to high gas prices, the reports said. The U.S. market accounts for some 40 percent of Toyota's worldwide profit.
Toyota's initial 2008 plan called for selling 9.85 million units, including those produced at two of its subsidiaries -- compact car-making Daihatsu Motor and truck-making Hino Motors.
Hit by sinking demand for fuel-thirsty SUVs and pickup trucks, Toyota this month announced a big overhaul of its North American manufacturing structure to build more fuel-efficient cars.
Toyota now plans to build its Prius hybrid at a factory under construction in Mississippi from 2010.
Nissan's Ghosn Sees No 2009 U.S. Auto Recovery
Separately, Nissan Motor said it doesn't expect U.S. auto sales to bounce back in 2009 after a sharp decline this year.
Chief Executive Carlos Ghosn said Nissan expected industrywide U.S. sales to be near 14.3 million units in 2008, down from 16.15 million in 2007. Next year's tally would be about the same at 14.3 million, he said, adding that the risk was for a lower figure.
"Please be prepared to see a changing forecast," Ghosn told reporters "I think we are going to have a challenging couple of years."
Ghosn pursued an unsuccessful partnership bid with GM in 2006 and has said in the past that Renault-Nissan would welcome a North American partner to round out its alliance, spurring speculation of potential tie-ups with Ford Motor or Chrysler.
But Ghosn cautioned on Tuesday that the industry's downturn and volatile commodity prices had made equity-based deals harder to complete. "Today, obviously, the market conditions are very uncertain, so the likelihood of moves now is relatively small because we need to understand what we're buying," he said.
In any case, Ghosn said Nissan-Renault would never be involved in an outright acquisition of another automaker.
"When people talk about consolidation they talk about Company A buying Company B," he said. "But we know this doesn't work in our industry. Company A buying Company B is guaranteed to destroy value."
Nissan has gained market share in a declining U.S. market. The Japanese automaker's sales were down 2.4 percent in the first half compared with a 10.1 percent drop for the market overall.
In response to the dramatic consumer shift toward cars and away from heavier trucks and SUVs, Nissan has already adjusted production at its Canton, Mississippi plant.
The automaker has added a third shift of workers on the Canton plant's car assembly line in order to make more Altima sedans and cut a shift at the same plant's truck line which makes SUVs such as the Pathfinder and Armada.
"The market has changed dramatically," Ghosn said. He added: "For the past few weeks, it looked like the only car you could sell in the United States was a four-cylinder."
Needed: More Cars, Fewer Trucks
Ghosn, who was speaking at a ceremony to mark the opening of Nissan's new $100 million headquarters building in Nashville, said more adjustments to boost car production and cut truck output could be needed.
"If this market stays as it is -- as is likely -- you are going to see more of our capacity shifted."
Nissan began 2008 prepared for a downturn but had not anticipated the extent of the industrywide U.S. sales slide or the sharp declines in resale values of larger used vehicles that came with it.
That shift in used-car prices has hurt major automakers and finance companies because SUVs coming off lease contracts are being resold for less than had been forecast in the lease.
The resulting losses have to be covered by financial reserves. Ghosn said the amount of reserves needed for Nissan had been "the only surprise" of the downturn for Nissan.
Ghosn also serves as CEO of Renault, the French automaker that has a 44-percent stake in Nissan. Taken together, the two companies make up the world's fourth largest car group by sales.
On a more limited basis, Ghosn said Nissan's product specific tie-up with Chrysler announced earlier this year would sharply cut truck development costs for Nissan.
Nissan has pledged to build a small car for Chrysler using the North American automaker's design in 2010, and Chrysler would build a new full-sized pickup truck for Nissan in 2011.
Ghosn said that would cut development costs for the next-generation Titan pickup truck to one-quarter of what they would have been otherwise.