USHotRod

What exactly is the deal w/ toyota? Why is there profits off the wall when the Ford F-series alone sells more than their two top models and is hurting so bad? Whats the deal?

0toinsanein5.4sec

just a total guess, but maybe toyota has more of its models up higher in the ranks. like maybe toyota has numbers 11, 12, 13, 14, but ford has like 20+ for all the other cars. it probably isnt exactly like those numbers and those are slight exagerations, but thatd be my guess.

Ken S

they also don't have to pay all that healthcare and pension.... yet at least.....

99SilverSS

Toyota is also much more effecient in their manufacturing and thus lower cost per unit produced. This coupled with much higher payroll eats away at profits and Ford's bottom line shows the results. Even the new 04 F150 will cost several hundread ($250-500) more to make than the current model, now Ford will probably pass on these "savings" to the customer but the point is Ford is paying more for a new generation vehicle than they did for the old model. It shows ineffeiciencies in the process and thus Ford's overall business plan.

The big 2.5 rely on large numbers of models sold to recoup lost profits on lower selling models. The philosophy is to have the best selling models in the corp lineup "carry" the rest. Thus if Ford wants to make more cash they focus on the F150, and Explorer instead of making every model profitable like the Toyota. And thus you have models like the T-bird that for many reasons don't pull their weight.

Toyota's philosophy focuses on each model being almost its own corp and making more money than it costs the company. TO do this they focus efforts on the engineering and manufacturing effeciencies to bring the overhead costs per model, per unit down and thus making profits go up. Toyota makes the most it can on each model, Ford would rather sell 2-3 more to get the same profit.

Lets not even talk about incentives whare domestic makes are giving away the profit to get models moving, again a way to "carry" the carmaker throught sales.

jrp4uc

A good explanation. Sounds like the Japanese have a more conservative philosophy and have each car make a little rather than put all their chips on a couple vehicles as it appears Ford has.

formula79

Toyota makes more money on every car they sell....A GM dealer will take $6K off a Trailblazer in a heart beat. A Toytoa dealer will sell you a Rav4, Highlander, 4Runner, or Sequioa at sticker and make you think he is doing you a favor. Would you rather sell 5 vehicles and make a $1000 each or sell one vehicle and make $5,000. Also this higher margin means that your manufacturing unit is more profitable. Also Toyota owners are much less likley to bring thier cars in for warrenty work that a domestic buyer would. The old "Something's wrong with my Toyota, I musta broke it" mentality. Toyota dealers make more money on service also because Toyota buyer have the dealer do service more often than domestic buyers.

Also one other chunk of Toyota's profit that is overlooked is small cars. I bet if you compared the profit that the Corolla and Celica make (yes they are based on the same platform), then look at how much GM looses thier *** on the J-cars and it is obvious what a large peice of the problem is.

dnovotny

Hmm, I negotiated the car price when my parents bought a Toyota Avalon back in '97. We paid $800 over invoice. I've paid between 500-800 over invoice each time I've bought a Pontiac or Chevy. And this happened right here in the Bay Area, CA where everything is overpriced and Japanese cars are very popular.