February 06, 2010
Toyota:Why, Oh Why?
Toyota Motor Corp’s president finally appeared in public to apologised yesterday ( 6 February 2010) for safety problems saying the automaker would bring in outside experts to review quality controls, a highly unusual action for a company that has epitomized world-beating industrial standards.
Let us read Reuters report.
“I would like to take this opportunity to apologize from the bottom of my heart for causing many of our customers concern after the recalls across several models in several regions,” Akio Toyoda, the grandson of Toyota’s founder.
Toyoda’s comments were his most extensive since the latest recall began in January. Toyota has issued two recalls since last November.
Investors were relieved that Toyota finally announced concrete steps to deal with the quality crisis. The company’s shares, which have taken a beating recently, ended 4.1 per cent higher at US$74.71 on the New York Stock Exchange yesterday. Since Jan 21, Toyota has lost US$30 billion (RM102 billion) or a fifth of its market value.
But in a sign the carmaker still faces serious problems, credit ratings agency Standard & Poor’s put Toyota and some of its suppliers on watch for a possible downgrade. S&P cited “increased concern over the potential negative impact on Toyota’s business profile of unfolding developments related to recent quality issues.”
Toyoda apologized for safety problems that have left the Japanese carmaker “in crisis”.
He said Toyota would strengthen its inspection process, respond faster to customer complaints and seek input from outside experts.
Toyoda also pledged to set up and oversee a quality improvement task force involving external experts monitoring quality management. It was not clear how the global quality management committee would function.
Turning to independent experts is “about as good as you can expect,” said UBS analyst Philippe Houchois.
“I’ve seen a lot of recalls, but I don’t remember seeing that step of getting an outside expert. That’s quite an innovative or aggressive approach to try to solve the problem,” he said.
Toyota, the world’s largest automaker, has recalled more than 8 million vehicles around the world for problems with accelerators. Episodes of unintended acceleration in Toyota vehicles have been linked to up to 19 crash deaths in the United States over the past decade.
Toyota is also mulling a recall of Prius, its top-selling hybrid, for a braking problem.
The company has estimated that lost production, lost sales, parts to fix problems, staff training and repairs to recalled vehicles will cost Toyota US$2 billion from January to the end of March.
The news conference came after US competitor Ford Motor Co readied a solution for braking problems on two of its hybrid models, the hybrid Fusion and Mercury Milan.
Until recently, the 77-year-old Toyota was considered the paragon of lean production, quality control and continuous improvement. But the crisis generated by the recalls and the way the company has handled itself publicly have led to widespread criticism. Toyoda, 53, bowed in apology after addressing the news conference and answered other questions, some in English, after an official tried to end the late-night session.
Toyoda became the company’s president last year, promising to steer it out of its worst downturn in history and bring greater transparency to its corporate culture.
The current crisis, surrounding accelerators produced by an American supplier, highlights a possible flaw in the company’s vaunted lean production system, analysts have said.
By reducing complexity from their products — for instance by cutting the number of suppliers and using common parts across different products — manufacturers who have followed the Toyota Way have cut costs and increased profitability — but left themselves terribly exposed to the unexpected.
“One of the ways Toyota has reduced costs in their lean program was commonality of parts,” said Alex Blanton, an analyst at Ingalls & Snyder.
“Well, if that part has a problem, then it affects many more models. If they’d been using a lot of different gas pedals for these models and they had problems with one, they wouldn’t have to shut down the company.”
In January, Toyota temporarily suspended US sales of eight models and halted production of the vehicles at five facilities in the United States and Canada.
Safety regulators in the United States and Japan are investigating a braking problem with Toyota’s latest version of the Prius, Japan’s top-selling car last year and an icon of green design that has lifted the public image of the whole company.
Japan’s transport minister said he had heard from ministry officials that Toyota would recall or voluntarily fix the automobiles affected, including those shipped overseas.
“Toyota’s response came up short from the perspective of its customers,” Transport Minister Seiji Maehara said.
Since its launch last May, Toyota has sold more than 300,000 of the newest version of the Prius worldwide, including around 200,000 in Japan, 103,200 in the United States and 29,000 in Europe.
Toyota’s and Ford’s hybrids capture the energy from braking to recharge an on-board battery to boost mileage from its gasoline engine.
Toyota Prius owners have complained that on bumpy roads and on ice, the regenerative brakes of the vehicle appear to slip and it lurches forward before the traditional brakes engage.
The US National Highway Traffic Safety Administration said it has received 124 complaints from drivers of the third-generation Prius. The agency said that motorists have blamed four crashes on this problem.
Toyota and Ford have said that they have come up with software fixes for the problems.
Quality is everything when yuor are competing globally. Screw up once and you love goodwill and market share.
Will Toyota regain its position as numero uno automaker again? They have to work doubly hard, I guess.
Labels:
Perspectives
Australia: Ringing in Better Times
Effectively the end of March,Australia will end its bank deposit and bank funding guarantees.So said Treasurer Wayne Swan today, adding that these had served their purpose in helping to stabilise the financial system.
Let us read the Reuters report on this.
"The government guarantees were announced in October 2008 to help banks maintain access to funding during the global financial crisis, and to ensure customer confidence in Australia’s banks.
Swan said the decision was based on advice from the Australian Council of Financial Regulators.
“The council ... has advised that bank funding conditions have improved such that the guarantee is no longer needed, and that no Australian institution will need the guarantee to fund themselves,” Swan said in a statement.
He said existing guaranteed liabilities for banks and lending institutions would continue to be covered until they matured, or until October 2015 for at call deposits.
“The guarantee has been vital to the stability of our financial system when others were collapsing across the globe, leading to the first contraction in the global economy since World War II,” Swan said in a statement.
“It gave our banks continued access to global capital markets on competitive terms, which has been critical in supporting the flow of credit through the Australian economy.”
He said Australian banks and other lenders had so far paid around A$1.1 billion (RM3.26 billion) for the use of the guarantee and will pay around A$5.5 billion over its full life."
Well looks like the Australian banking system can stand on its own. I guess they will now play by ear and the cost of funds will again be determined by market forces.With commodity prices going up once more, perhaps bank rate may just go up to that expected 4% again.
Let us read the Reuters report on this.
"The government guarantees were announced in October 2008 to help banks maintain access to funding during the global financial crisis, and to ensure customer confidence in Australia’s banks.
Swan said the decision was based on advice from the Australian Council of Financial Regulators.
“The council ... has advised that bank funding conditions have improved such that the guarantee is no longer needed, and that no Australian institution will need the guarantee to fund themselves,” Swan said in a statement.
He said existing guaranteed liabilities for banks and lending institutions would continue to be covered until they matured, or until October 2015 for at call deposits.
“The guarantee has been vital to the stability of our financial system when others were collapsing across the globe, leading to the first contraction in the global economy since World War II,” Swan said in a statement.
“It gave our banks continued access to global capital markets on competitive terms, which has been critical in supporting the flow of credit through the Australian economy.”
He said Australian banks and other lenders had so far paid around A$1.1 billion (RM3.26 billion) for the use of the guarantee and will pay around A$5.5 billion over its full life."
Well looks like the Australian banking system can stand on its own. I guess they will now play by ear and the cost of funds will again be determined by market forces.With commodity prices going up once more, perhaps bank rate may just go up to that expected 4% again.
Labels:
Economy
It's True that RWS has been given the Casino Licence!
We all know the Singapore government to be a pragmatic one. They would not let you down. However, they are very strict and transparents and will enforce laws and reglations if infraction occurs.
And so it came to pass. Resorts World Singapore was awarded its casino licnese to commence operations. What an auspicious red letter day it is for Lim Kok Thay, a second casino licence for his family via Resorts World Sentosa.
Let us now read the report from Channel NewsAsia posted on 6 February by Wang Eng Eng.
"SINGAPORE: Resorts World at Sentosa has been awarded its casino licence. It is the first of Singapore's two integrated resorts to get the go ahead for its casino operations.
Although the opening date of the casino at Resort World has not been announced, preparations are in full swing.
Resorts World Sentosa chairman Lim Kok Thay said: "We are very happy to have received the casino licence. This was made possible by the dedicated team, consultants, contractors and government officials, especially the Casino Regulatory Authority, which worked tirelessly to set up the regulatory framework within a very agressive timeline."
Lunar New Year decorations have already been put up at the lobby of the casino.
Resorts World staff were in the midst of an orientation.
Although the doors remain shut, visitors are excited about the prospect the casino may be opening soon.
Some are hoping the casino will be open in time for the Lunar New Year which begins on February 14.
While foreigners do not have to pay the US$100 levy before entering the casino, locals will have to do so at this booth.
Before arriving at the booth, visitors to the casino will be segregated according to whether they are Singaporeans or overseas guests.
The S$6.6 billion integrated resort at Sentosa is opening in phases, starting with its hotels last month.
Many are also waiting for the theme park, Universal Studios Singapore to open.
Some of the staff at the resort have been busy testing out the amusement rides and more.
Andrea Teo, vice president, Entertainment, Resorts World Sentosa, said: "We are in full swing, getting ready for the theme park. We have been testing and commissioning the rides. Some of our people have been experiencing this - going from ride to ride to ride and having a very good time. And we have all been eating at restaurants, trying out the food at very good prices.
"We are at various percentages of finishing the different rides and resorts. But I would say that we are on an actually pretty fast track to completely everything. Our hotel opened on the January 20 and since then, we've had 90 per cent occupancy. Festive Hotel and Hard Rock have been fully booked. And for Chinese New Year, we are fully booked.”
And while casino staff are busy gearing up for the opening day, Singapore's Police have also been started serving the Exclusion Orders to those with a history of crimes such as those related to drugs and illegal money lending.
So far, about 3,500 people with serious criminal records have been barred from the two casinos when they open.
The latest exclusion orders are on top of what the National Council on Problem Gambling has issued.
Some 28,000 undischarged bankrupts and those on public assistance have also been banned from entering casinos."
And so it came to pass. Resorts World Singapore was awarded its casino licnese to commence operations. What an auspicious red letter day it is for Lim Kok Thay, a second casino licence for his family via Resorts World Sentosa.
Let us now read the report from Channel NewsAsia posted on 6 February by Wang Eng Eng.
"SINGAPORE: Resorts World at Sentosa has been awarded its casino licence. It is the first of Singapore's two integrated resorts to get the go ahead for its casino operations.
Although the opening date of the casino at Resort World has not been announced, preparations are in full swing.
Resorts World Sentosa chairman Lim Kok Thay said: "We are very happy to have received the casino licence. This was made possible by the dedicated team, consultants, contractors and government officials, especially the Casino Regulatory Authority, which worked tirelessly to set up the regulatory framework within a very agressive timeline."
Lunar New Year decorations have already been put up at the lobby of the casino.
Resorts World staff were in the midst of an orientation.
Although the doors remain shut, visitors are excited about the prospect the casino may be opening soon.
Some are hoping the casino will be open in time for the Lunar New Year which begins on February 14.
While foreigners do not have to pay the US$100 levy before entering the casino, locals will have to do so at this booth.
Before arriving at the booth, visitors to the casino will be segregated according to whether they are Singaporeans or overseas guests.
The S$6.6 billion integrated resort at Sentosa is opening in phases, starting with its hotels last month.
Many are also waiting for the theme park, Universal Studios Singapore to open.
Some of the staff at the resort have been busy testing out the amusement rides and more.
Andrea Teo, vice president, Entertainment, Resorts World Sentosa, said: "We are in full swing, getting ready for the theme park. We have been testing and commissioning the rides. Some of our people have been experiencing this - going from ride to ride to ride and having a very good time. And we have all been eating at restaurants, trying out the food at very good prices.
"We are at various percentages of finishing the different rides and resorts. But I would say that we are on an actually pretty fast track to completely everything. Our hotel opened on the January 20 and since then, we've had 90 per cent occupancy. Festive Hotel and Hard Rock have been fully booked. And for Chinese New Year, we are fully booked.”
And while casino staff are busy gearing up for the opening day, Singapore's Police have also been started serving the Exclusion Orders to those with a history of crimes such as those related to drugs and illegal money lending.
So far, about 3,500 people with serious criminal records have been barred from the two casinos when they open.
The latest exclusion orders are on top of what the National Council on Problem Gambling has issued.
Some 28,000 undischarged bankrupts and those on public assistance have also been banned from entering casinos."
Labels:
Stocks
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