Japan to Announce $17 Billion Aid for Asian Countries at the World Economic Forum

Japanese prime minister Taro Aso is going to announce a $17 billion aid for the Asian countries in order to continue the regional growth amidst the current economic recession. Taro Aso’s monetary strategy seems to be different from his predecessor former prime minister Junichiro Koizumi who used to cut foreign aid by 2 to 4 percent during his tenure as Japanese prime minister. The World Economic Forum will be held in Davos, Switzerland.

Bloomberg reported:

The funds will be disbursed “as expeditiously as possible”, Sakashita said later in an email. Details of the package, aimed at boosting regional growth amid a global recession, will be determined at the East Asia Summit in Chiang Mai, Thailand later this year.

This is really very good news for the Asian countries as Japan is going to keep its foreign aid continuing in order to accelerate the regional development in the Asian countries.

Toyota’s operating loss increasing

Toyota is the largest car maker in the world and last year their condition looked very smooth as they overtook GM as the leading auto maker. However, now because of global economic recession, Toyota is suffering a lot and it is giving some operational loss. This matter is going to continue for the next few months as the condition of American economy is only becoming worse. Even yesterday, there was new report about employment situation and job loss has not stopped and the economy of the USA has impact shrug some compare to the past month. So, investors in the USA share market are now worried about the future and everyday we are getting new news about job losses. For example, Ford is cutting down 1200 employees. Eastman Kodak, which is a famous company about photography, is cutting 4500 jobs. Starbucks the leading coffee chain is decreasing almost 6000 employees. The list can continue and that is why; I am not surprised to see that Toyota has been giving operational loss.

Hyundai Steel Predicts Fall in Sales by 26% in 2009

Hyundai Steel, the largest steelmaker in South Korea, is predicting sales drop by 26 percent in 2009 because of slowing demand in the market. The uncertain business outlook for 2009 is another reason for aggravating the condition for Hyundai Steel. Global credit crunch has played a big role behind the fall of demand in the steel market, following four successful years on a row. Steel mills around the world are experiencing the worst time at this moment in the recent years. Due to economic recession, investment in new business project has been slowed down, thus sliding the demand for steel worldwide. So, it is pretty much certain that Hyundai Steel is going to see drop in yearly sales in 2009.

Related article:

Reuters

Honda Motor Co. to Cut Domestic and North America Production Further

Japanese automaker Honda Motor Co. is planning to cut further in its global production volume, within just 10 days of its first production cut got announced. Honda has recently claimed that the demand has fallen down more than what they initially expected, and that is why, Honda is going to reduce its domestic production by 21,000 vehicles to 1.15 million units for the current fiscal year. Honda will also cut North America production volume by 29,000 vehicles because of demand fall.

Alike market leader Toyota, Honda is also facing double problem at this moment. One problem is drop in demand and another problem is surging Japanese Yen against foreign currencies. As the companies like Toyota and Honda export products outside Japan, it has become a big problem for them.

Related article:

The Wall Street Journal

Bad News for Toyota: 7% Drop in Sales

Toyota Motor Corp. has forecast that its global sales will fall to over 7 million next fiscal year in what would be 7% less than Toyota’s global sales in the current fiscal year. Toyota can manufacture over 10 million vehicles globally per year. So, Toyota’s production surplus is expected to mark 3 million next fiscal year. That is why, the Japanese auto maker is making production cut worldwide. It would cut its domestic production to less than 9,000 volumes in February and March because of surging Japanese Yen against foreign currencies. The company also experienced 36.7% drop in its US sales in December last year. So, Toyota is going to reduce its production volume in North America. Toyota will cut 1000 jobs in North America and Britain.

Related article:

Market Watch

Toyota to Cut Domestic Production in January-March Quarter

Global car maker Toyota might reduce its domestic car production in January-March quarter because of the strengthening Japanese currency against foreign currencies. Toyota could cut its total production volume in Japan by 40 percent during January-March quarter compared to the same period of last year. If the reports are to be believed, then domestic production of Toyota might continue in April too. In fact, Toyota’s domestic production might fall by 60 percent in April.

Related article:

Bloomberg

Motorola lays off 77 workers and stops mobile development

Motorola is in a bad shape. One of the leading mobile phone producers had been badly hit by the economic recession. In order to cut cost, the company has decided to lay off its 77 employees at its Plantation facility. Earlier on January 15, 2009, the company announced to lay off 4000 workers in North America. The new declaration will become affective from March 27, 2009.

South Florida Business Journal reports:

In its notice to the state, Motorola said those employees affected by the layoffs will not have the right to bump or displace other employees. However, they can apply for open positions and will be provided with severance.

A company spokesperson did not return calls for comment.

In terms of business, 2008 was a bad year for Motorola. For the last couple of years, the company enjoyed the top third spot in terms of mobile phone sales. In 2008, it slipped down to 4^th position with sales of 99.9 million mobile phones. Due to job loss and financial crisis, consumers have decreased buying new phones. Moreover, the company failed to bring in good quality products which caused its downfall last year.

LG takes third spot selling 100 million mobile phones in 2008

Renowned South Korean electronics company LG took the third spot in mobile sales. According to JongAng Daily, the company sold 100 million mobile phones around the world. LG took the third spot in terms of sales volume removing Motorola who has long been acquiring the third position. Motorola sold 99.9 million around the world. Finnish mobile company Nokia is in the first position as usual.

Crave reports:

Nokia, of course, was the top dog. Preliminary numbers show that the Finnish giant sold 470 million handsets in 2008, putting it far ahead of Samsung, which claimed the number two spot with 200 million handset sold. Nokia shows no sign of losing its No. 1 status, even though Samsung pumps phones out nonstop.

The ongoing economic recession has affected the mobile company. Compared to previous years, sales figures are not so good. Overall the year 2008 has been a time of evolution for mobile companies not revolution. Let’s see what happens in 2009.

Hyundai Assurance program is a hit in USA Auto Market

The economic recession has hit the automakers badly in USA. Top companies like General Motors went bankrupt. However, Asian automakers are not in a bad shape in USA. Hyundai Motor Co., the largest automaker in USA started a new program and it became an instant hit among buyers. Under this new program, buyers who would lose their jobs in one year of buying the car would be able to return them. The company started this new program on January 3, 2009.

Reuters reports:

Hyundai, whose sales plunged 48 percent in December, has seen U.S. sales rise in the first half of January from a year earlier, the automaker said in a presentation to the Automotive News World Congress.

"It's too early to say what it is going to look like for January, but the early results are promising," John Krafcik, acting president and chief executive of Hyundai Motors America, said of the car return program.

North America is the biggest auto market in the world and Asian automakers have become the top automakers in USA. Toyota is the number one auto-maker in USA. Hyundai has also curved its niche in the American market.

Canon shuts down its Melville construction office

Canon USA branch will shut down its Melville construction office as the company has not cleared issues related to “site approvals and incentives packages.” The company ordered Turner Construction, the contractor company to remove its office from the Melville site. In a statement, the company said that there is no necessary for a

full-time construction office as work has not begun.

Long Island Business News reports:

Canon, which currently operates out if Lake Success, was enticed to build the new campus in Melville because the Suffolk County Industrial Development Agency offered it $35 million in incentives. Those include $16 million in local and state sales tax exemptions and $19 million in property tax breaks for a decade after the headquarters opens.

Canon is a famous Japanese company that mainly specializes in cameras, photocopiers and computer printers. In the new office 2500 workers are going to work.

How long will Toyota remain No.1 carmaker in USA?

Toyota Motor Corporation is the largest automaker in Japan. Now, it has become the largest automaker in USA. In 2008, the Japanese automaker crossed General Motors in terms of sales volume. However, the ongoing economic crisis hit the company pretty bad. General Motors, one of the “Detroit three” and the largest auto maker in USA is in a pretty bad shape because of poor sales. The company produces cars that are not fuel efficient. Moreover, people have stopped buying cars due to economic crisis. Tatsua Mizuno, analyst, Fitch Ratings said:

"This is not a case of Toyota being stronger but that GM is so weak at the moment,…Toyota had been doing quite well for a few years and even the first half of last year was not bad, but even so they have failed to build appealing new vehicles…..For the fiscal year that starts in April, we expect Toyota's weak performance to continue,….It's something we expect to see across the whole auto sector, particularly if the yen continues to appreciate."

In the ongoing fiscal year that ends in April, Toyota sold 8.97 million vehicles compared to GM’s 8.35 million. Due to global economic crisis sales of Toyota fell by 4% and GM 10.8%. The company is taking various cost cutting measures including laying off its employees and encouraging consumers to buy cars. Now the million dollar question is, will Toyota retain its top position.

Related article:

Telegraph.co.uk

Number one carmaker Toyota shedding temporary jobs

For the last three years, we have seen many news about the competition between Toyota Motor Corporation (TYO:7203) and General Motors Corporation (NYSE:GM)  for becoming the leading automaker in the world. GM had traditionally positioned itself as the top automaker in USA but in 2008, it was like the year of Toyota and Toyota achieved good success but then came the great economic recession. GM is now struggling a lot and even we have seen talks of GM getting bankrupted. The only good thing perhaps for Toyota is that their condition did not reach so bad and they are still doing ok. However, economic condition is not good in the markets of Toyota like Japan and USA and even in Asian countries like China and India fewer people are willing to spend to buy car. So, it is becoming a big problem for carmakers as in the time of economic recession the car companies suffer perhaps the worst way. Toyota is now going to shed 3000 temporary workers and the company is not going to take any new temporary workers at this moment. This is bad news for Japanese economy because many Japanese people consider Toyota as an indication of their national economic status.

 

Related article:

AFP

Leading Mobile Phone Makers Joining Content Production Rat Race?

Because of the ongoing economic recession, the mobile phone makers are worried whether they can sustain their growth in countries like India and China. The leading mobile phone makers have witnessed tremendous growth in the last one decade thanks to mainly the emerging markets of Asia but things are not rosy at all at this moment as people are now worried about the future. So the leading mobile phone makers are now total is focused on developing new strategies and their only goal is to retain the existing consumers for the time being. In a bid to do so, they are now focusing on content creation that will give entertainment to the consumers.

I am not surprised by this move because it is really a very tough time and it is one is now trying their best to survive.

Related Article

Mobile phone giants dial up entertainment in growth bid: analysts

G1 Mobile Phone in Germany for just 1 Euro?

It is not any catchy advertisement headline but there is a catch- you will have to subscribe two years of T-Mobile service in Germany to get G1 Mobile Phone book for just one Euro. I’m sure that many German consumers would be very happy with this news but the only problem is that it is the time of economic recession and many people in European countries like Germany are not seriously thinking of buying new and expensive mobile phone sets. Apple is really lucky because when it introduced iPhone in the German market it received good response as people were not so much worried about their future like now.

Related Article

Google phone to reach Germany in two weeks

Sony Ericsson posted loss. The company is undergoing massive re-structure

In the fourth quarter of 2008, famous mobile phone maker, Sony Ericsson observed a loss of $245 million. The ongoing economic recession badly affected the company’s profit. In the fourth quarter of 2007, the company posted a profit of $495 million. Compared to this figure, $245 million shows a drastic drop in its profit. Due to job loss and economic difficulty, people are not spending much money on mobile phones. The major weakness of Sony Ericsson is that the company does not produce any entry level mobile phones like Samsung, Nokia or Motorola. In the fourth quarter of 2008, Sony Ericsson shipped 24.2 million phones. Compared to 2007, this is a 21% drop. Dick Komiyama, President, Sony Ericsson said:

"In economic terms, 2008 has been a tumultuous year with world markets experiencing a serious downturn,……We foresee a continued deterioration in the marketplace in 2009, particularly in the first half."

Recently, the company released Xperia X1 and another 8.1-megapixel camera phone but they failed to capture consumers’ attention. It also started to offer a new “food-ordering service” within fast-food restaurants called “EZ Pass environment.”

It is not only Sony Ericsson that is suffering from this problem. Other mobile companies are also expecting a contraction in the cell-phone market. In order to survive these tough economic times, Sony Ericsson is undergoing a massive re-structure. It already laid-off 2000 employees and the president said that more people would be removed from the company. It is currently working to achieve a cost saving goal of $398 million.

Also read: Acer Aspire One 103 Ready for Win 7 in Pictures; to Release Next month

Related articles:

Information Week

Fierce Wireless

Toyota to Cut in North America Production again in Fear of Annual Operating Loss

Toyota Motor Corporation is going to cut its production once again in the North American market because of slow-down in the market. In fact, for the first time in 70 years, Toyota predicted an annual operating loss recently. The decrease in production will vary in car models and this reduced production comes into effect in the facilities in the upcoming months. Because of economic recession and oil price hike, Toyota’s sales decreased significantly last year and the Japanese automaker is now also in fear of facing an annual operating loss this year.

Amidst global credit crunch, car makers are facing huge problems as no. of sales volumes has been reduced considerably and the situation is getting aggravated day by day. People are also looking for hybrid cars and fuel efficient cars.

Related article:

Fox News

2009 is going to be worse than 2008: Automakers are going for more production cuts and layoffs

The auto-industry is already infested by production-cuts and layoffs in the face worldwide economic recession but 2009 is going to be worse than 2008. According to latest news reports, major Japanese automakers are going to further cut down their production and layoff temporary workers.

Honda Motor Co., Ltd. (TYO: 7267) is going to cut down production to 1.17 million in the current fiscal year ending in March. Honda will also layoff 3100 of its temporary workers in Japan in April. Honda's major rival, Toyota Motor Corporation (TYO:7203) is cutting down production till April 2009 in its U.S. and Canadian plants. Toyota will also layoff 5,000 temporary workers in its Japan and US manufacturing plants. The company is facing its first operating loss in the last 71 years.

Fuji Heavy Industries Ltd. (TYO:7270), the producer of Subaru cars, and Yamaha Motor Co., Ltd. (TYO:7272) also declared to cut down their production. Due to economic crisis, worldwide sales of automobiles has decreased significantly. North America, which is considered to be the largest market in the world, is in a terrible condition. Analysts are saying that auto sales may hit "a 27-year low" in 2009. On January 15, 2008, General Motors Corporation (NYSE:GM) said that sales of automobiles in USA would drop to 10.5 million in 2009.

Related articles:

Bloomberg

Honda scraps projects for survival

In the face of auto-sales slump, Japanese Automaker, Honda Motor Co., Ltd. (TYO: 7267) decided to scrap its various projects. These include development of its convertible CR-Z, which is going to be the successor of Honda S2000, the company's popular sports car model, a rear-drive line-up of Acura, development of a new V-8 engine and launch of a new single global model for Honda Accord. In order to keep the company running, the automaker had to shutdown these projects. The production of S2000 will also stop at the end of 2009. CNet reports:

Tough times already had killed the planned 2010 Acura NSX, which would have had a front-mounted V-10. Now Honda also has decided to shelve a rear-drive V-8 Acura that was meant to take on BMW in 2015, according to Autocar. The V-8 -- long a thorny issue, given Honda's green image -- was seen as the wrong powerplant because of the uncertain future of fuel prices.

American automakers observed sales slump when price of fuel went up. All the major American automakers specialize in building trucks, pickups and SUVs. Due to the price rise of fuel, people stopped buying these cars. At such a time, Honda motor enjoyed a little success because unlike its competitors, Honda specializes in producing fuel-efficient small cars. However, the worldwide economic recession affected the auto industry. Now, like every other automaker, Honda is trying hard to survive these tough economic times.

Here, I like to mention that even companies like Google are finding things to be tough.

Related articles:

Cnet News

Car Wale.com

Chinese Farmer Wu Yulu Becomes Famous for Robotic Invention

Wu Yulu is a Chinese farmer, but his sons are not human being! No, I am not kidding you. Yulu’s sons, as he claims, are not human beings. They are made up of pieces of plastics and various metals and in fact, they are robots. Yes, this Chinese farmer has become famous in China by making robots which turned his fortune around. Despite facing severe hardship in life, Wu Yulu did not give up on making robots, a work he has had fascination for since his early life. He burnt down his house while spraying with battery acid, and thus, he along with his family was homeless. His sons left house and wife Dong Shuyan was also about to leave. Moreover, with battery acid, Wu Yulu also burnt his face and chest and was hospitalized. He said that he considers his robots as his sons and loves the robots more than his sons.

Wu Yulu is not in poverty now and has become an inspiration for many in the country. He is now working in developing robotics with universities and companies. He is no more a poor farmer; rather Wu Yulu has become a living example for many of us who lose patience in despair and give up halfway of a work.

Related article:

Reuters

South Asia Blog

Japanese Government Lending $13 Billion to the Banks to Keep Economic Crisis under Control

Japan is the richest country in Asia, but the Asia’s biggest economy has not gone untouched by the ongoing economic slump. Japan government is now lending 13 billion dollars to the banks and other financial companies in order to ease the credit flow in the country. Providing 1.225 trillion yen (13.2 billion dollars) to the banks, Japan is trying to ensure that the banks will have enough money so that they can continue lending money to various companies and organizations amidst economic downturn. Recently, Japanese banks have been pretty strict in lending money due to the current economic recession, even though Japanese economy has not been hit severely by the credit crunch yet.

The News reported:

"The central bank will continue providing capital proactively to the market to ensure the stable management of small- and mid-size companies," Bank of Japan governor Masaaki Shirakawa said in parliament.

The BoJ has little room to reduce its rock-bottom interest rates further so it is seeking alternative tools to repair credit markets that have been battered by the global financial crisis.

The BoJ has pledged to supply an unlimited amount of funds against eligible collateral at an interest rate of just 0.1 percent.
On December 19, it slashed its key rate to just 0.1 percent to cope with the worsening global slowdown……….

It is good to see that BoJ is taking several attempts to prevent against the current global economic downturn which has reached at its peak since 1930’s Great Depression. There is no sing of hope that this economic crisis will decrease in the near future. So, it is a good move by Japanese government that they are trying to keep the credit flow intact in the country. However, the question is that for how long the problem will remain under control by this artificial measure.