Toys4RJill

I agree. Lexus is much .ore interesting and stylish than ever before.

PhilipMSPT

iTrader: (5)

So much fire and brimstone for profits.

Yes, the profitability is less, but that doesn't mean it's lacking success. This is a shareholders' problem, not necessarily the company.

In 10 years, cars will drive themselves. So, everyone's complaints about the lack of horsepower and track times will be moot. In general, that's not how you make (the best) profit.

gengar

And again, what does this have anything to do with Toyota's FY2017 income?

mmarshall

And again, they may be still paying out settlements.

EZZ

Settlements aren't enough to impact profits and generally the analysts exclude one time charges in evaluating the strength of a stock. If the settlements did impact the P&L materially, Toyota would have disclosed the impact so analysts can exclude those charges against the current P&L. This comes down to reduced profitability due to overspending. Paying out settlements is completely irrelevant in Toyota's case. VW's situation is very different as their settlements are so large and egregious that it's materially impacting their entire operating structure.

gengar

OK, so provide your evidence that Toyota is still paying out settlements and that it had any impact on their FY2017 income.

mmarshall

Well, that was the point I was trying to make. We still don't know exactly how much, if any, impact it has (or will have). To state a given figure would be pure guesswork.

One thing, though that concerns me, with the money-situation, is that this could lead to more cost-cutting on vehicles that, IMO, already show too much of it. Toyota does some things very well (engine/drivetrain durability, for example)....but, in general, at least IMO, their interiors and hardware tends to be lightweight, somewhat flimsy-feeling, and unimpressive.

97-SC300

iTrader: (17)

I agree with what people are saying. As much as I like some Lexus products I cannot see myself getting something like the new LX or GX because of what they did to the exterior designs (looks goofy), which is a shame because the interior on the new LX is amazing.

They finally accomplished what they always lacked, a unique company face and design. Unfortunately for them, that company face is pretty ugly (most people would agree).

oldcajun

As I read the article, sales are up a little, revenue is up, but the profit on this increased revenue is down. This generally points to a cost issue in either R&D, manufacturing, and/or sales. We know at least part of the problem is the cost of money due to an unfavorable exchange rate. With the new platform coming on line, short term manufacturing costs will be high due to new tooling, delays, and learning curve. With older designs and a view that products are not as desirable as competitors, sales prices are reduced and larger incentives are needed to keep volume up. With new platforms coming on line much of this profit issue should be reduced. The only big help for the exchange rate is the production of cars in other countries which Toyota is already pursuing.

The worst possible outcome of this focus on profits is massive cost cutting in the products. It has happened before, let's just hope it will be better managed this time.
Steve

rominl

iTrader: (4)

if 20% drop in operating profit is true, that's a very big hit...

there are quite a few things toyota is facing, a lot of uphills

Mr. Burns

I assume this means decontenting and cost cuts to future Toyota vehicles is already in the works.

GTSLEX

iTrader: (2)

Nasty spindle grill that doesn't appeal to mass market and ancient power trains = poor sales = decrease in profit. Doesn't take a genius to figure that out.

Johnhav430

I believe this is all car companies, and has been for nearly 10 years, not as extreme, but it's "sneaky" like the world's largest eTailer. Meaning, we give you this, which is flashy, but we take away that, which some or many might not notice. imho car co's products peaked sometime around 2005-2008, when it seemed like engineers had free rein...(one example of many, would be a car that in 2007-10 had a true dual exhaust, and then in 2011 had a fake dual exhaust costing 1/2, but at the rear bumper, looks the same, but this is already 6+ yrs. past). Now can your 2007 stream music, or have such high res on its nav screen, and come with a built in 4G LTE advanced hotspot (I don't get this one, what is the benefit? lol)? Forget about when you lift the vehicle that the true dual is gone and the control arms are made of steel....

SW17LS

You don't understand what the article is talking about. Sales are not poor, sales aren't down. Profitability is down. In fact, sales are up and revenue is up. PROFIT is down.

Just because one company sells more products doesn't at all mean they are more profitable. It's very possible for a company to sell far more product than a competitor and yet be far less profitable.

As for any unintended acceleration settlements, I agree this is a non issue. Thinking it is shows a lack of understanding about the scale of what we're talking about here. Those settlements were like you and me paying a $50 parking ticket, it has no impact on our bottom line.

gengar

I'm not a fan of the spindle grill either, but as noted in the article, unit sales were actually up year-over-year.