Toyota Motor Corp. on Friday sharply downgraded its earnings forecast for this fiscal year through March, blaming a strong yen and the massive flooding in Thailand.
Japan’s biggest automaker expects to book a net profit of 180 billion yen ($2.3 billion), down 54 percent from the 390 billion yen it projected in August. It estimates leaner revenue of 18.2 trillion yen ($234.36 billion) from 19 trillion yen.
Toyota expects to sell 7.38 million vehicles worldwide this year instead of 7.6 million it predicted four months ago.
The maker of the Camry and Corolla sedans is on track to lose its title as the world’s largest automaker this calendar year. Toyota sank to No. 3 in vehicle sales during the first six months, trailing U.S. rival General Motors Co. and Volkswagen AG of Germany.
Toyota held off from releasing new earnings forecasts when it announced its first-half earnings results last month, citing uncertainties from the Thai floods that disrupted parts supplies.
It’s been a rough year for Japanese car makers, who were first hit with the earthquake and tsunami in March. They had largely rebounded from the disaster when they confronted the immense flooding in Thailand this autumn. Car production as far away as North America was scaled back as the creeping floodwaters put suppliers out of action.
The flooding, which was Thailand’s worst in half a century, will result in an output loss of 230,000 vehicles, said Executive Vice President Satoshi Ozawa at a news conference in Tokyo.
He told reporters the company had learned from its experience this year and that it would study ways to ensure that such unforeseen events “never again” lead to paralysis of supply chains.
But among Japan’s car makers, Honda Motor Co. has been the worst hit by the floods. It has yet to release forecasts as a result.
Compounding the pain is a strong yen, which hit multiple historic highs against the dollar this year. With jitters about European and U.S. economies, global investors have turned to the yen as a relative safe haven.
For exporters like Toyota, a strong yen reduces the value of overseas profits when repatriated and makes Japanese products less competitive on prices in markets outside Japan. Exports are a key driver of economic growth in a country that faces a rapidly aging and shrinking population at home.
Japanese manufacturers, including car and high-tech makers, responded by shifting more production abroad _ a trend that has government officials and the business community concerned about a hollowing out of Japanese industry.
“Because of the strong yen, the collapse of the foundation of Japanese manufacturing has begun,” Ozawa said.
Toyota’s new forecasts incorporate a 120 billion yen hit on operating profit from the Thai floods and another 190 billion yen from the negative impact of currency levels.
It now sees operating profit of 200 billion yen, compared with 450 billion yen in its August forecast.
The company lowered its foreign exchange assumptions to account for the yen’s appreciation over the last several months. It expects the yen to average 78 to the dollar this year, from 80 yen to the dollar in its previous estimate. It assumes 109 yen against the euro, down from 116 yen to the euro.
Toyota reports earnings based on U.S. accounting standards.
Toyota will begin taking orders Tuesday for the plug-in version of its hit Prius hybrid, announcing efficient mileage and a relatively affordable starting price of 3.2 million yen ($41,000), which comes down with green vehicle subsidies.
Toyota is targeting Prius Plug-in sales of 35,000 to 40,000 a year in Japan, and 60,000 globally. The car is set for delivery in Japan in January. With subsidies the cost comes down to 2.75 million yen ($35,200). It starts at $32,000 in the U.S. and 37,000 euros in Europe, according to Toyota.
Japan’s top automaker says the plug-in, which it calls the Prius PHV, is for those who want something more innovative than a regular gasoline-electric hybrid, but are worried about running out of power on the road, as can happen with pure electric vehicles.
When a plug-in runs out of power to keep the electric vehicle going, it becomes a hybrid.
“The plug-in is the premier next-generation ecological car that will follow the hybrid,” said Executive Vice President Takeshi Uchiyamada, the Toyota Motor Corp. engineer known as the “father of the Prius.”
The Prius Plug-in has an estimated electric vehicle cruise range per charge of 26.4 kilometers (16 miles), according to Toyota.
Its mileage is estimated at 61 kilometers per liter for Japanese test conditions, which converts to a whopping 143 miles per gallon. Such numbers vary depending on road conditions. Toyota is promising 87 mpg for the U.S. Prius Plug-in, which will be delivered starting in March. Orders are already being taken online in the U.S.
Green cars such as the Prius Plug-in are expected to take centerstage at the Tokyo Motor Show, which opens to the public this weekend.
Japanese consumers have taken to the Prius, despite a languishing auto market overall, thanks to government-backed subsidies. Nations around the world are offering similar perks, boosting its chance for success.
The Prius Plug-in, which seats five people, comes with a new lithium-ion battery that can be charged from a household outlet, much like an electric car. It also recharges itself while driving like a gasoline-electric hybrid. The battery is more powerful and compact so the back trunk fits three golf bags.
Uchiyamada told reporters that the plug-in was the best solution for green cars as most Japanese don’t drive more than 20 kilometers (12 miles) a day and Toyota studies showed that most people don’t want to use EVs for drives longer than 100 kilometers (60 miles).
How the plug-in fares in coming months will help show whether Toyota can keep riding on its success of the Prius as a global leader in green technology. Toyota said it had collected data from 600 people around the world who had leased the plug-in on a trial basis.
Toyota has sold more than 3.4 million hybrids worldwide so far, including models other than the Prius.
Selling in big numbers is important because it helps cut costs and allows the automaker to offer products at affordable prices.
Honda Motor Co., which has also been aggressive with hybrid technology, has sold 770,000 hybrids worldwide.
Nissan Motor Co., which hasn’t released a global hybrid sales number, is banking more on pure electric, selling 17,500 Leaf cars around the world so far.
In Japan, Toyota will work on services with its housing unit to support plug-in owners’ charging stations, it said.
Actress Sienna Miller told a media ethics inquiry Thursday that she was left paranoid and scared by years of relentless tabloid pursuit that ranged from paparazzi outside her house to the hacking of her mobile phone.
Miller said the surveillance, and a stream of personal stories about her in the tabloids, led her to accuse friends and family of leaking information to the media. In fact, her cell phone voice mails had been hacked at Rupert Murdoch’s News of the World tabloid.
Miller, 29, became a tabloid staple when she dated fellow actor Jude Law. She said the constant scrutiny left her feeling “very violated and very paranoid and anxious, constantly.”
“I felt like I was living in some sort of video game,” she said.
She called the paparazzi focus on her terrifying.
“For a number of years I was relentlessly pursued by 10 to 15 men, almost daily,” she said. “Spat at, verbally abused.
“I would often find myself, at the age of 21, at midnight, running down a dark street on my own with 10 men chasing me. And the fact they had cameras in their hands made that legal.”
Miller, the star of “Layer Cake” and “Alfie,” was one of the first celebrities to take the News of the World to court over illegal eavesdropping. In May, the newspaper agreed to pay her 100,000 pounds ($160,000) to settle claims her phone had been hacked.
The newspaper’s parent company now faces dozens of lawsuits from alleged hacking victims.
Miller, who looked confident as she gave evidence at London’s Royal Courts of Justice, said challenging Murdoch’s media conglomerate had been a difficult decision.
“I was very nervous about taking on an empire that was richer and far more powerful than I will ever be,” she said. “It was very daunting.”
“Harry Potter” author J.K. Rowling, who has campaigned to keep her children out of the media glare, is due to give evidence later Thursday about media intrusion.
Prime Minister David Cameron set up the inquiry amid a still-unfolding scandal over illegal eavesdropping by the Murdoch-owned tabloid. Murdoch closed down the News of the World in July after evidence emerged that it had illegally accessed the mobile phone voice mails of celebrities, politicians and even crime victims in its search of scoops.
More than a dozen News of the World journalists and editors have been arrested over allegations of illegal eavesdropping, and the scandal has also claimed the jobs of two top London police officers, Cameron’s media adviser and several senior Murdoch executives.
The inquiry, led by Judge Brian Leveson, plans to issue a report next year and could recommend major changes to media regulation in Britain.
Miller took the stand after another witness was allowed to give evidence in private. The courtroom was cleared of the press as the witness, identified only as HJK, testified about suffering intrusions while in a relationship with a well-known figure, whose identity was also kept secret.
Former Formula One boss Max Mosley, who has campaigned for a privacy law since his interest in sadomasochistic sex was exposed in the News of the World, broadened the focus in testimony Thursday, discussing the difficulty of squashing malicious stories in the Internet age.
Mosley successfully sued the News of the World over a 2008 story headlined “Formula One boss has sick Nazi orgy with five hookers.” Mosley has acknowledged the orgy, but argued that the story _ obtained with a hidden camera _ was an “outrageous” invasion of privacy. He said the Nazi allegation was damaging and “completely untrue.”
Mosley said he has had stories about the incident removed from 193 websites around the world, and is currently taking legal action “in 22 or 23 different countries,” including proceedings against search engine Google in France and Germany.
“The fundamental thing is that Google could stop this appearing but they don’t or won’t as a matter of principle,” he said. “The really dangerous things are the search engines.”
“You work all your life to try and achieve something or do something useful,” Mosley added. “And suddenly something like this happens and that’s what you’re remembered for.”
High-profile witnesses still to come include CNN celebrity interviewer Piers Morgan, who has denied using phone hacking while he was editor of the Daily Mirror newspaper.
The hearings have heard allegations of media malpractice and intrusion that extend far beyond the News of the World.
Witnesses have included celebrities like actor Hugh Grant and ordinary people pursued in times of grief, including the parents of murdered 13-year-old Milly Dowler, whose voice mails were accessed by the News of the World after she disappeared in 2002.
Her parents said the hacking gave them false hope their daughter was still alive during the investigation into her disappearance.
On Wednesday, the parents of missing child Madeleine McCann said they were left distraught by false stories and the publication of private information by the tabloid press.
Kate and Gerry McCann told the inquiry they felt powerless in the face of stories, based on concocted evidence, suggesting they had killed their daughter. Madeleine had vanished when she was three during the British family’s 2007 vacation in Portugal.
Guyana has signed a $1 billion agreement with a Canadian-based company for what the government says is the largest private mining investment for the South America country.
Toronto-based Guyana Goldfields Inc. said the Aurora Gold Project agreement signed Friday is the first large-scale gold mining license that Guyana has issued since 1991.
The government said it is expected to create more than 1,900 temporary and permanent jobs and Guyana Goldfields CEO Patrick Sheridan said it is expected to generate $1.6 billion in government revenues at a time of record gold prices.
The company announcement said it will pay a mining royalty of 5 percent when gold sells for $1,000 an ounce and 8 percent when the price is greater. It will also pay a corporate income tax of 30 percent.
The agreement is for 20 years, with provisions for extension.
The company said construction should start early next year and the mine and mill should be operating by early 2014.
Guyana’s government on Friday also announced a $138 million contract with the Beijing-based China Harbor Engineering Co faxless payday loans. to build a new airport terminal and add more than 3,200 feet (1,000 meters) to the main runway at the country’s principal airport, Cheddi Jagan International.
The current 7,400-foot (2,255-meter) runway cannot accommodate fully loaded jumbo jets. A Caribbean Airlines Boeing 737 aircraft that landed late on the runway on July 20 crashed through a fence, breaking in two. No one died.
The two deals come just ahead of Nov. 28 parliamentary elections, and the main opposition coalition complained the airport deal should have been debated by the legislature.
Rupert Roopnarine, the prime ministerial candidate of the Partnership For National Unity, criticized the government for making the deal after Parliament was dissolved for the general election.
EMI Group Ltd., the iconic British music company that is home to The Beatles, Coldplay and Katy Perry, is being split and sold for $4.1 billion.
The deals will open EMI’s buyers, Universal Music and Sony/ATV, to regulatory scrutiny as they increase their dominance of the music industry.
Universal Music Group said Friday that it will pay 1.2 billion pounds ($1.9 billion) for the recording division, joining Universal artists including Lady Gaga and Eminem with EMI superstars such as David Guetta and Lady Antebellum.
A consortium led by Sony/ATV announced a separate deal Friday to pay $2.2 billion for EMI’s publishing division. That business is in charge of songwriting copyrights for such artists as Rihanna and Norah Jones.
Sony/ATV, a joint venture between Sony Corp. and the Michael Jackson estate, said it is a 38 percent partner in the consortium. Other parties include Mubadala Development Co., Jynwel Capital Ltd., the Blackstone Group and David Geffen.
The two-part sale, if approved by regulators, would further increase Universal Music’s dominance in recorded music and springboard Sony/ATV into the top spot as a music publisher, according to Impala, an association of European independent music companies that is against the deal.
The purchases would give Universal Music and Sony/ATV undue negotiating power over artists and distributors of music, even over the world’s biggest music store, Apple Inc.’s iTunes, Impala said.
Both deals are expected to be carefully reviewed in Europe, the U.S., Japan and Australia. Even if regulators approve, they could force the sale of key assets or attach other terms.
Helen Smith, Impala’s executive chairwoman, noted that when Universal Music bought music publisher BMG in 2007, it had to sell some assets to get smaller.
“When you have players which are dominant, even if they take over small players in market share, that can have a serious impact on competition,” she said.
Jean-Bernard Levy, CEO of Universal Music parent company Vivendi SA, told analysts on a conference call that he was “very confident” the deal would be approved in as little as 10 months.
In the United States, Universal is the top music producer with a 30 percent market share compared with EMI’s 9 percent, according to Nielsen SoundScan. With a combined share of 39 percent, they would tower over Sony at 29 percent and Warner Music at 19 percent.
On the publishing side, Sony/ATV will add EMI’s 1.3 million song copyrights to its roster of 750,000 songs that include hits from The Beatles, Bob Dylan and Taylor Swift.
The deal leaves Citigroup, EMI’s current owner, with liability for its underfunded pension plan, according to two other people familiar with the talks. One put the liability at $600 million, the other said it was about $260 million.
Neither person was authorized to speak publicly and spoke on condition of anonymity.
Citigroup had put EMI up for sale in June, four months after it foreclosed on private equity firm Terra Firma. Terra Firma bought EMI in 2007 in a $6.8 billion acquisition financed with debt from Citigroup, but it couldn’t make enough money to keep up with the terms.
Vivendi believes it is swooping in to buy a troubled asset at an “inflection point” in the music industry, Levy said. Thanks to gains in digital track and album sales, overall U.S. album sales are up 5.2 percent at 360 million units so far this year, according to SoundScan. At this point last year, overall album sales had plunged 10 percent.
Vivendi expects to cut costs and save more than $150 million a year _ making the deal profitable even if the music industry doesn’t grow in the future. Vivendi expects the deal to boost its profits in the first year after regulatory approval.
Morningstar analyst Allan Nichols, who covers Vivendi, viewed the deal with trepidation on fears that the music industry could resume its decline and that regulators could reject it.
But antitrust regulators could be more lenient of big tie-ups when the music industry is struggling to recover from more than a decade of online piracy, he said.
Also, Vivendi is paying less per dollar of earnings than Access Industries’ Len Blavatnik did when he took Warner Music Group Corp. private for $1.24 billion in July.
“The catalog is very impressive, and they didn’t pay a whole lot,” Nichols said.
Sony/ATV’s interest in expanding its library is due to the stability of licensing music copyrights, a business that has been profitable over the years because it relies on business customers like filmmakers instead of individual consumers.
Sony/ATV plans to reap new revenues from the EMI catalog, which includes around 100 No. 1 hits from Motown artists Smokey Robinson, Marvin Gaye, Stevie Wonder and The Supremes.
“We think there are biopics and life stories yet to be told about them,” said Sony/ATV Chief Executive Marty Bandier in an interview. “There’s a depth and quality to this asset that can’t be compared to anything.”
In a move that may appease regulators in Europe and the U.S., Vivendi said it would sell 500 million euros ($680 million) worth of non-core assets, mostly minority stakes in companies that it did not disclose. Strategic bidders that lost out on the auction, such as Warner Music, are expected to vie for those assets.
Vivendi said that London-based EMI would find a safe home at a company headquartered not far away in Paris.
“For me, as an Englishman, EMI was the pre-eminent music company that I grew up with,” Universal CEO Lucian Grainge said in a statement. “UMG is committed to both preserving EMI’s cultural heritage and artistic diversity and also investing in its artists and people to grow the company’s assets for the future.”
Grainge said on the conference call that he would ensure the famous Beatles’ recording studio, Abbey Road Studios, would remain open as a “symbol of British culture.”
Universal released statements from bands in support, including from Coldplay manager Dave Holmes, who said “this can only be a positive for the artists and executives at EMI.”
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Toronto
Choosing a much-detested raccoon as its mascot made a clear statement: Porter Airlines was going to be a daring, different kind of airline.
And the upstart that some doubted could ever succeed given the volatility of the aviation industry is celebrating its fifth birthday on Sunday.
Robert Deluce, president and CEO of Porter Airlines, uses the mascot, whom they call Mr. Porter, an alter-ego of sorts, to illustrate why they
The Toronto Historical Board plaque is the first hint to would-be buyers that 7 Wellesley Ave. is every bit as special as its $775,000 price tag.
And it is.
This classic Cabbagetown Victorian is a historic home without a history.
It
BlackBerry services buzzed back to life across the world Thursday, after a three-day outage that interrupted email messages and Internet services for millions of customers.
Research In Motion Ltd., the Canadian company that makes the phones, posted a statement that says services are improving.
Many BlackBerry users have been unable to send and receive emails and messages in an outage that started Monday in Europe. Web browsers haven’t been working either. On Thursday morning, BlackBerry users on Twitter and online forums were reporting that their phones were buzzing with incoming messages again.
RIM co-CEO Mike Lazaridis apologized for the outage in a video posted to the company’s site Thursday morning.
“It’s too soon to say that this issue is fully resolved,” Lazaridis said. “I’d like to give you an estimated time of full recovery around the world, but I cannot do this with certainty at this time.”
A crucial link in BlackBerry’s European network failed Monday, and a backup also failed. Although the underlying issues were quickly repaired, the system had built up a backlog of emails and messages that needed to be wound down. Meanwhile, messages destined for Europe were piling up at BlackBerry data centers in the rest of world. By Wednesday, the outage had spread to the U.S. and Canada, slowing service to a crawl there.
RIM shares were down 35 cents, or 1.5 percent, at $23.53 in premarket trading in New York. Investors have taken the outage in stride, figuring that it’s only one of many problems RIM is facing. The shares are up slightly since the outage began.
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