Honda

[Capo]

Isn't the problem that the market has shrunk?

[speedevil]

I understand about business decisions to cut back on non-essential expenses.  Companies that don't or wait too long to adjust to market conditions won't be around long.  Sometimes business mistakes are fatal to the business.  This economy is not going to reward the inept.

Having said that, and having a Goldwing in the garage, here is a link to a very insightful message regarding Honda.  This is from the gl1800riders.com forums.  Agree, disagree, don't care - any way you feel about it the author makes several valid points.

http://gl1800riders.com/forums/showthread.php?t=198585

[DesmoDog]

I'm willing to bet that if GM or Chrysler slip into bankruptcy, Honda and Toyota are going to be looking to purchase factories to build vehicles that would fill the void

I'll take that bet. If GM slips into a position where they arne't building cars anymore, Toyota will be scrambling to find new suppliers for the cars they already build.

There seems to be an attitude/perception that this is only a (not so) big three problem, that if GM goes away everyone will just buy Brand x instead. Doesn't work that way. If GM goes away, a lot of suppliers go away too. These suppliers aren't exclusive to GM but GM keeps them alive. If Toyota can't buy, say, exhaust systems because the supplier went under, their production line stops too. Maybe they own the tooling to make whatever part it is they need, but probably not. So what do they do? Go to another supplier and get it? Nope. They wait until someone else can tool up and get the part into production. And they pay a lot of money to have that done quickly. Assuming they can find someone to do it for them to begin with.

If GM fails, Honda/Toyota is screwed. Buying another plant will be the last thing they'll want to do.

Even overlooking the supplier problem, Toyota isn't building cars at full capacity. Honda isn't either. They're going to utilize what they have before they invest hundreds of millions (billions?) into buying and tooling up a new plant to build cars they already build somewhere else. The world has too much capacity for building cars - a plant that closes isn't getting reopened anytime soon by anyone.

The exception to this is if GM or Chrysler fails, somebody is going to buy specific brands, such as Jeep. Plants would likely be part of those purchases.

[Capo]

Toyota post first loss since 1941

http://news.yahoo.com/s/afp/20081222/bs_afp/financeeconomyworld

Land Rover & Jaguar are on the skids

Maybe we will all be getting our cars from China

[Goat_Herder]

Isn't the problem that the market has shrunk?

The market can shrunk but you still have to work to keep the market share that you have (the percentage of the total market).  If your market share gets smaller as the overall market shrinks, then you are losing ground faster than your competitor.  That would be insult to injury...

[gearhead]

 People who have money that spend it now are not inept in my opinion. An example is the stock market where there will be alot of money to be made by those smart/lucky/stupid enough to be buying when prices are down now. In essence the same as capturing market share when your competitor is busy turtling in.

[herm]

Toyota post first loss since 1941

http://news.yahoo.com/s/afp/20081222/bs_afp/financeeconomyworld

Land Rover & Jaguar are on the skids

Maybe we will all be getting our cars from China

i heard that was well.
the big difference (and this applies to all the Japanese auto companies) is that toyota has substantial cash reserves. they are going to hunker down and watch the american big 3 disintegrate.