auto-makers Archives - the patient investor

December 21, 2013

Productivity Commission report says Australian car makers can’t compete on labour costs

An increasing amount of the world’s cars are now built in countries such as Brazil, China, India, Mexico and Thailand, while countries such as Australia, the US, the UK and Belgium have shed workers since 2008.

The [Productivity Commission] report finds labour costs in Australia “relatively high”, although not substantially different to Germany or Japan. “But [they] are four times or more those of China, Thailand and other developing countries where motor vehicle production is expanding,” it found.

February 23, 2012

Yen’s Fall May Benefit Japan Firms – WSJ.com

TOKYO—As the yen finally buckles versus the dollar, Japan’s exporting manufacturers are sitting on potential operating-profit gains that could be worth billions of dollars on paper, likely triggering some higher earnings forecasts if current trends persist.

….Like many of Japan’s biggest companies, the big three auto makers—Toyota Motor Co., Honda Motor Co. and Nissan Motor Co.—are heavily exposed to exchange-rate fluctuations. Estimates by the three show that every ¥1 variation in the dollar exchange rate has an impact of ¥67 billion on their combined operating profit. That means the dollar’s gains since the central bank’s easing could notionally assist the three auto makers’ annual operating profit to the tune of ¥165 billion, or more than $2 billion at recent exchange rates.

via Yen’s Fall May Benefit Japan Firms – WSJ.com.