The weak dollar vs Yen and Toyota’s production decisions

An Associated Press article (January 15,2011, http://finance.yahoo.com/news/Toyota-Rising-yen-could-force-apf-1661264517.html?x=0) describes the impact of the current 83 yen to the dollar exchange rate on Toyota’s decisions regarding production. Toyota has the largest Japanese production of all Japanese automakers, and the strong yen decreases the profitability of that decision.  Toyota’s President Akio Toyoda describes the company’s responsibility to preserve manufacturing in Japan and its role to deliver profitability to shareholders and suggests that the company may have to shift production out of Japan.  How long should the strong yen persist before the switching costs of production are dominated by production shifts ? Will the weak US dollar succeed in bringing increased production to US plants ?

Advertisements

About aviyer2010

Professor
This entry was posted in Global Contexts, Supply Chain Issues and tagged , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s