Here's a theme you'll be reading variations on for years to come: Toyota Motors
Case in point: a story in TheWall Street Journal last week about how Toyota has so much cash on its balance sheet that it is taking over some of the functions of the Japanese central bank, becoming the lender of last resort to Japanese companies in dire financial straits. When a company starts taking on the attributes, and fulfilling the functions, of a nation state, look out -- you're dealing with a Rule Maker.
More to the point, on Monday, Toyota announced that next year it will double its production of hybrid gas-electric Prius sedans for sale on the U.S. market. This was not exactly news, mind you. Back in July, Toyota advised it would be significantly expanding U.S. sales of the Prius, and might go so far as to double them. But now that "might" has become a resounding "shall."
Let's take a quick look at the numbers. Worldwide, Toyota currently makes about 125,000 "Prii" per year. Toyota is now boosting that number to 180,000. U.S. sales of the Prius are expected to be in the 40,000 range this year. Next year that will be 100,000. So in 2005, Toyota will boost production worldwide by about 55,000, and send literally nearly every extra car produced -- to the U.S.
This, my friends, is an all-out assault on the U.S. auto industry and its hopes of competing successfully for "green" car buyers. So far, among U.S. automakers, only Ford
Right now, Toyota's only serious competition for hybrid passenger vehicle sales comes from back home: Honda
Given the disarray and limited offerings of the competition, Toyota's flooding of the U.S. market next year may well satisfy the lion's share of the demand for hybrid vehicles -- leaving no buyers left for the also-rans, and little hope of gaining economies of scale on their hybrid product lines. If they don't act soon to reverse this trend, within a year or two at most, resisting Toyota may become truly futile.
Read all about the developing war for hybrid vehicle dominion in these electrifying stories:
- Toyota Versus Bill Gates
- Honda's Signals Mixed
- Dealers Cash In on Hybrids
- Ford's Profit Potential Is Electric
Fool contributor Rich Smith owns no shares in any company mentioned in this article.