TOYOTA RECALLS AND PROBLEMS
Toyota and the Economic Crisis in 2008
2010 Camry RECALLED Toyota had aimed to sell 10 million vehicles a year by 2010 but suffered a severe set back when it t was stung hard by the global financial crisis in 2008 and 2009. Toyota sold 7.56 million units in fiscal 2008-2009—enough to outperform GM and make Toyota world’s largest automaker but 1.34 million less than the previous year. Toyota had originally forecast sales of 9.85 million in 2008 and 10.4 million in 2009. It sold 7.81 vehicles in 2009, down 13 percent from the previous year. Toyota posted a $4.61 billion loss in fiscal 2008, the first time in 71 years it posted a loss. The previous year it made a profit of $22.7 billion. The loss was a particularly nasty considering it made a huge profit in the first six months of 2008. In the first three months of 2009 it lost more money than GM. In the 2nd quarter f 2009 Toyota lost $1.8 billion. The losses and sales drops were the biggest crises that Toyota faced since the company was founded. Vehicle production for the company in Japan in February 2009 was only 141,127 units, the lowest output figure on record. Several of Toyota’s key suppliers and contractors teetered on the edge of bankruptcy as their orders were reduced to near zero. The influence of Toyota’s sudden decline of production on workers, suppliers and other business that rely on a strong, healthy Toyota was called “Toyota shock.” The term was also used it describe the fact that even Toyota was not going to escape big time problems associated with the global economic crisis. Bad news from Toyota was enough to send the whole Japanese stock market tumbling. Toyota’s losses were attributed to shrinking auto sales associated with the global financial crisis, depreciation of the yen and rising material costs. Many blamed the scale of Toyota’s losses on rapidly expanding in problematic areas—namely gas-guzzling SUVs and pick ups—at an inopportune time. The global...
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