Toyota Union and Wage Hikes: Updated Feb. 18, 2025

Toyota union seeks wage hike on par with 2024's decades-high raise

Article source: https://mainichi.jp/english/articles/20250212/p2g/00m/0bu/020000c

Commentary:

The Toyota Motor Corp. is usually the company with the most power in Japan and all other companies follow that Toyota does, especially related to wage increases.

So most likely Toyota is talking for all the other Japanese companies and wage increases in April.

The challenge is going to be the small and midsize companies which don't have the resources that the large companies have and might not be able to pay the same wages as the large companies.

Japan is in the middle of a labor shortage, which means Japanese workers have a choice in companies to choose from so most likely some or many small and midsize companies will not be able to meet the demands of the short labor market and lost out of some of the better talent in the market place.

The Bank of Japan can't do everything to help the Japanese economy so companies increasing wages is the way for the market place to help improve the Japanese economy.

Toyota most likely collaborated with other Japanese companies on what they needed and Toyota then signaled what other companies wanted in wage increases for April 2025.

But again, its quite possible some of the larger companies too might have challenges with wage increases, they risk losing qualified candidates if they can't match what other companies in their sectors are doing.

Back around the year 2,000 Toyota decided not to give wage increases which might have set in motion the two decades period of no wage increases or very low wage increases until last year.

Most likely there is a new group of managers at Toyota which sees the need to pay wage increases for the good of the company not to mention they need to keep wages at a competitive level to attract the best and brightest in Japan.

Of course, again, Toyota has the resources to pay the high wages increases but maybe Nissan, which is having financial challenges nowt might not be able to match Toyota wage increase.

Nissan and Honda just ended its negotiations to merge both companies as it looked like Honda had the upper hand in the negotiations which Nissan didn't like so they ended the meetings.

The 18,000 wage increase might be good enough for those in Nissan's union but what about the wage or salary for those jus starting out in the company. Will it be enough to attract talented workers to Nissan.

Honda is in much better financial shape that Nissan so they afford to pay a little more than what Nissan is offering.

It seems like most of the large Japanese companies are offering about the same amount with some a little more and some a little less depending on the sector.

Once again, Japan is in the middle of a labor shortage that might not be eased anytime soon, as maybe Japan immigration is not willing to allow a lot of foreign workers into Japan to meet the labor shortage.

For example, if Japan would utilize its existing resources correctly such as using more women in the labor force and or allow more women students in the technical and engineering areas at universities it might help significantly with the labor shortage in Japan.

And then Japan should eliminate its mandatory retirement age of 60 or 65 and let all who are able and willing to work continue to work and that too could significantly reduce labor shortage in Japan.

Most likely many of the large companies are going to increase wages by at least 5 percent or more but the challenge is with small and midsize companies that don't have the same resources and the large companies and as a result might not be able to match the large company wage increases which means they might not be able to attract the best and brightest in Japan.

At the same its been suggested that up to 70 percent of Japanese workers don't work for the large companies in Japan but small and midsize companies which means they might not get near the 5 plus wage increase that large companies are planning on doing.

So it means maybe 70 percent of the Japanese workforce will have wage increases less than inflation of less that inflation that increases every month.

Have a nice day!

Japan New Car Sales: Updated March 19, 2024.

 

Japan's new car sales increase 13.8% in 2023, 1st rise in 5 yrs

Article Source: https://mainichi.jp/english/articles/20240105/p2g/00m/0bu/050000c

Ideas:

Japan has nine major car manufacturers, but some of the smaller car companies are subsidiaries of the larger car companies such as Toyota and Nissan.

The US now has only 2 or 3 major car companies and competition and finances have whittled the number down. 

But of course the US is an import country, which means almost every major global car company is is in the US now.

Possible because Japan still has eight car companies, is a sign of cooperation among Japan companies and not so much about cut-throat competition.

The same can be said maybe about the airline industry in Japan with two major companies and many smaller regional and or low-cost airlines that are subsidiaries of the two largest airline companies.

The decrease in sales in 2022, was a combination of the pandemic and parts shortages such as a semiconductor shortage due to supply chain challenges.

Talking to a Japanese person in 2022, the person said it was taking up to six months, at that time, the get a new car.

Daihatsu, at the time of this article, might still be having production challenges due to discrepancies in quality control issues. 

Daihatsu is part of the Toyota group as a subsidiary, as it produces its own cars and also produces some Toyota cars too.

A countries population has to be big enough to support nine car companies but at 125 million the Japanese population seems well able to handle the load.

At the same time, buying a new car is not an everyday purchase, so again, the larger the population, the more chances of a lot of car sales.

Japan, for the most part, is not a showing society or show-off society and they don't buy cars to show off their wealth, so many Japanese cars are suited for the ordinary Japanese citizen, even though Lexus, a luxury Toyota brand is gaining some sales.

And for example, compared to South Korea, which does like to show off their wealth, there are not a lot of BMW's or Mercedes, in Japan, compared to other countries.

You can see the stark difference between the number of Toyota sales and the number of Nissan and Honda sales and which brand is the most popular in Japan. But that doesn't mean Nissan and Honda are not profitable or not popular, as both brands are strong global leaders too.

As mentioned before Daihatsu is having some challenges, and at this time, maybe the Toyota group told them to halt production and fix their quality control challenges.

The halting of production on the Daihatsu lines doesn't look to have made a real dent in the production or sale of overall Toyota car sales.

Minivehicles,, which are not talked about a lot are very popular in some countries and Japan too, as sales are continuing to increase in the minivehicle market globally.

Again, back in 2022, a Japanese person told me it was taking up to six months to get a new car order, but maybe the back-log has been solved.

Japan, for what its worth, makes all kinds of vehicles, and not just for Japan but many Asian countries including India too.

And many Japanese car companies have been able to find a niche or the kinds of cars that different populations want and need, and not just the standard Toyota but many other kinds of cars globally.

Now how is the Japanese car going to deal the the increase in EV cars and hybrid cars that many global buyers want now.

Have a nice day and be safe!

Toyota Output: Updated Feb. 7, 2024.

 

Toyota logs record Oct. output, sales despite production halt

Article Source: https://mainichi.jp/english/articles/20231129/p2g/00m/0bu/020000c

Article:

NAGOYA (Kyodo) -- Toyota Motor Corp. said Wednesday its global output and sales hit record highs for October on robust demand in North America and Europe, despite a temporary production halt in Japan due to an explosion at a parts supplier's factory.

The automaker made 900,285 cars worldwide in the month, up 16.7 percent from a year earlier, and sold 890,241 vehicles globally, up 7.0 percent, the company said.

The pace of production picked up amid an easing semiconductor shortage, and its production outside of Japan increased 8.7 percent to 617,590 cars, an all-time high for a single month, it said.

Ideas:
Japanese car production is an economic driver for the Japanese economy, meaning, as a major export it helps the Japanese economy grow.

At the same time, a car company like Toyota probably has thousands of subcontractors who provide any number of auto parts and services, that also increases jobs and economic growth.

It needs to be understood, unfortunately, that large companies like Toyota can and might wield its economic power, market power, with maybe not so good parts prices for suppliers, Most likely it doesn't happen but its always a possibility.

It seems like maybe the semiconductor shortage is finally passed. Back in 2020, in a BBC article a German car CEO said the shortage could last a few years.

Article:

Domestic production jumped 39.2 percent to 282,695 units, even as the company halted some production lines in Japan for 10 days during the month after an explosion at a factory belonging to Chuo Spring Co. in the city of Toyota, Aichi Prefecture.

Toyota said a production ramp-up on the back of the improvement in the chip crunch made up for the output loss, which was caused by a suspension spring shortage resulting from the explosion.

Helping the rise in global sales was a 5.2 percent growth in sales outside of Japan to 756,245 units, also a record high for the month.

Ideas:

Production companies, car companies, are always experiencing plant shutdowns related to parts shortages, supply challenges, and plant equipment problems. The trick is do companies plan for the stoppages and can they get back on schedule without too much downtime. 

Japan needs, and most likely being worked on, Japanese suppliers to provide semiconductors too, as though Japanese companies don't have to rely on Taiwan or South Korea for their supplies.

Unfortunately, Japan has fallen behind in the production of semiconductor chips but with an agreement with Taiwan they are building new semiconductor plants in Japan. 

Even at 5.2 percent growth in sales outside Japan, Toyota is probably seeing improve profits as the weak yen makes sales outside of Japan increase.

Article:

Sales of hybrid cars were notably strong in North America and Europe, with models such as the RAV4 and Corolla particularly popular, the automaker said.

Domestic sales rose 17.8 percent to 133,996 vehicles, according to Toyota.

Global production at Japan's eight major carmakers, including Toyota, rose 12.2 percent in October from a year earlier to 2,371,355 units, as all of them except for Daihatsu Motor Co. reported year-on-year growth due to the improved supplies of semiconductors.

Ideas:
Improved supplies important for Japanese car makers, as they probably use thousands of suppliers related to their car production. As a result, the eight carmakers are a huge part of the Japanese economy, and of course provide thousands of jobs and many small supplier companies which again provide jobs to thousands of workers.

It interesting that Japan has eight major carmakers, while the US might have four only. It seems that maybe the Japanese car makers and Japan in general, is more about cooperation than competition. The same can be said about the Japanese airline industry, with two major airlines and a lot of low-cost or regional airlines that are related to the two major Japanese airlines.

At the same time, companies like Daihatsu, a subsidiary of the Toyota group, focuses on different cars, which makes small compact cars compared to the main Toyota company.  

Article:

Honda Motor Co.'s output increased 22.8 percent to 405,276 units as growth in the United States made up for a production drop in China, where it has been hit by stiff price competition. Nissan Motor Co. built 310,480 cars, up 4.3 percent, as it ramped up production in Britain.

Daihatsu saw its output fall 1.5 percent, coming short of the results last year, when it launched new models.

Ideas:

Japanese cars are sold globally and made in different countries globally. China maybe is experiencing many domestic challenges in its economy now. But China is now producing more EV cars than Japan and now might be the global leader in EV car production.

Daihatsu has had some internal issues which has forced them to shut production down for a while, and even in its overseas plants in Indonesia and India. 

Daihatsu, again is a subsidiary of the overall Toyota group, and Toyota has come under fire for the latest challenges at Daihatsu. 

Have a nice day and be safe!  

Honda Car Company: Updated Jan. 21, 2024.

 

Honda reports its 3Q profit jumped on strong demand at home and in the US

Article Source: https://mainichi.jp/english/articles/20231109/p2g/00m/0bu/059000c

Ideas:

Like Nissan, and the article before, Honda seemed to have a very good July-September 3rd quarter with a 34% increase earnings.

Of course the weak Japanese yen, boosted earnings as a weak yen increase profits for Japanese exporters.

It took a long time, maybe two years for the shortage of computer chips to finally get back to normal.

In a 2020 BBC article, with a German car CEO saying it could take two or more years for the chip shortage to finally be resolved. 

Even though the chip shortage and pandemic delays are finally being taken care of, for the most part, maybe they never should have happened. Yes, the pandemic was a once in a lifetime situation, that maybe was unexpected and maybe the delays related to the pandemic couldn't be helped, but companies should always have supply chain backups in case their main suppliers are having challenges with anything.

Slowing economic growth, sometimes, is just the business cycle situation, where there periods of good growth and periods or not so good growth.

China has maybe taken the global lead in EV cars and maybe, unfortunately, Honda and Nissan are now later comers, followers, in the EV market and might not be able to gain or regain market share in China and or maybe even the US.

But next year, if Honda begins offering BEVs it might be too late if China is selling them at this time,

South Korea car makers Hyundai and Kia have been making EV cars and hybrid cars for sometime, and they are now a large part of the market in South Korea.

Its quite possible, even though Toyota, Nissan, and Honda might be a little behind in EV production and sales, their brand loyalty among customers, globally, might help them catch up and even maintain market share in total car sales.

It must be remembered that Honda, and other Japanese car makers, and especially the smaller car makers in Japan, make more than just conventional cars such as motorcycles, trucks, subcompacts, and so on.

The challenge seems to be making sure there are enough charging stations in plenty of places for EV cars, and to make sure EV cars are not too expensive for the average Japanese household.

While the weak yen is of course very good for Japanese exporters, Japanese exporters need to be aware in fiscal 2024 as to what the Bank of Japan might do with its ultralow policy and will the BOJ increase the rate which means the yen might not be so weak.

The weak yen, mostly, is good for many in Japan and globally, but its not good for the domestic economy and import prices and inflation continues to cause higher than normal prices in the Japanese economy.

The Bank of Japan has to weigh what is best for the Japanese economy. For example, the weak yen, is an incentive for foreign tourist going to Japan. So the Japanese government and the Bank of Japan have to decide how much economic growth do foreign tourists help with growth. 

For example in 2023 25 million foreign tourists entered Japan, and that might have been a lot of spending on Japanese products, restaurants, hotels and so on. 

Does the Bank of Japan want to jeopardize losing a certain amount of foreign tourists and how much would they be willing to lose with the strengthening of the Japanese yen.

Sales, globally, for Honda seem to be solid expect for many Europe and Asian. But that is normal, as any company might not have solid sales in each region, so its good for companies such as Honda to be in as many markets as possible in case one region, such as the EU might be down for a while, while another region such as the US might be up.

And its important, again, to remember that Honda, like many Japanese car makers, and especially among the smaller Japanese car makers that they make more than just conventional cars. 

For example maybe in Indonesia and India, Mitsubishi makes subcompact cars for those markets that might not be sold in Japan.

Most likely shares of Toyota, Nissan, and Honda all increased because of record earnings.

Have a nice day and be safe!

Toyota Sales Growth: Updated Jan,. 1, 2024

 

Toyota posts record global output, sales in April-Sept. period

Article Source: https://mainichi.jp/english/articles/20231030/p2g/00m/0bu/027000c

Ideas:

Its amazing that just recently, the last two years, there were massive chip shortages related to anything that needed chips. 

But at the same time, the record output has to be thought of a making making up for lost production the last two years, because of the chip shortage.

But its no small feat that Toyota has been able to recover so quickly with significant sales and record output.

It just shows the global economy is doing OK and not headed for any kind of recession or even a slowdown or a pause due to inflation.

At one time, talking to Japanese citizens, they said, in Japan, in 2021, for example, it took 6 months to get a new Japanese car, due to chip shortage.

If Toyota saw such improved production and maybe sales figures too, what about the other major brands such as all of the European brands globally.

If the global economy continues to improve, or even stay on its current course, no doubt Toyota and other brands are going to have  record year.

But there is no certainty, exactly moving into 2024. There are no real signs of a recession or a slowdown but March is a long ways away from today.

North America and Japan seem to be doing just find with no slowdown indicated in the future. But China is in a different situation, with its domestic economy in a period of transformation along with some other domestic challenges. 

The Chinese car makers are headed in the right direction, and like other Chinese products over the past decade, they have caught up and maybe even passed some Japanese and South Korean brands. 

Again, part of the record sales might have been latent demand and or latent sales meaning because the past chip shortages maybe customers were just waiting until the pandemic and the chip shortages had passed before they decided to get a new car.

But whatever the reasons for the record output and record sales Toyota looks like its going to have a record fiscal year when it end at the end of March.

All car makers, not just Toyota, need to understand that maybe the cars that use gasoline might be extinct eventually. How long is it going to take before there are no longer any gasoline cars produced and sold? Who know exactly. It will depend on demand and if car companies can produce EV cars at a prices that the average family can buy one.

But of course its not going to be in 2024, but for sure more EV cars will be produced and sold than in 2023 as that appears to be the future,

Again, like any product, being able to produce a quality product at a price that the average household can afford. And not just regular sales, as many customers in Japan are now using a hybrid leasing system that lets them have a car for two or three years, without actually buying a new car.

Its interesting that Japan has eight major car makers, while the US has only maybe 3 major car makers. Of course there are other brands in the US, that produce and sell in the US including Toyota, which has many plants all over the US.

But back to idea of Japan having eight major automakers, might be an indication of cooperation more than competition among the eight car makers, and or they all have significant niches that they fill and don't compete exactly with each other.

Mitsubishi and the Chinese market it understandable and not unexpected as the competition with the new Chinese brands and maybe the fact that Mitsubishi couldn't meet the needs of Chinese customers, so it might have been a wise move to exit the market at this time.

It seems Japanese cars in the US, and maybe globally, has seen some kind of resurgence since the pandemic has come and gone and also, at the same time, as inflation in the US is decreasing and interest rates haven't been increased recently, which might be good for Japanese car customers and maybe other brands too.

However, there is the ideas of the weak yen, and Japanese exports, if any Japanese cars are exported to the US, they might be subject to higher prices, but as there are many Japanese cars now produced in the US they are not subject to the weak yen, which makes more affordable to US and Canadian customers.

Japan carmakers were smart to build car plants in the US and Canada, and Mexico, as a way to improve their supply chains and get past the weak yen situation.

Have a nice day and be safe!