TOYOTA ARM SEEKS GOVERNMENTLOAN
Posted March 3, 2009on:
Toyota, the world’s biggest carmaker, has said it is seeking a state loan to help its car financing unit.
The company said Toyota Financial Services was in talks with the government-backed Japan Bank for International Co-operation.
Local media reports said that it had applied for a 200bn-yen ($2bn; £1.45bn) loan. However, Toyota said no details had been decided.
Toyota has said it expects to report its first annual loss since 1950.
The Japan Bank for International Co-operation was set up last year to help struggling Japanese businesses.
apan’s Finance Ministry said earlier on Tuesday that it would provide an additional $5bn to the bank from its foreign exchange reserves.
‘Not in danger’
Toyota Financial Services does 70% of its business in the US, where the credit crunch has made it harder to offer financing and the economic downturn has hit demand for vehicles.
General Motors’ financing arm, GMAC, has been hit by losses and has received a $6bn bail-out from the US government.
Analysts said that the news did not mean that Toyota was in trouble.
“Toyota is not in danger. It’s out to get the lowest price for funding that the strength of its credit can get,” said Yasuaki Iwamoto, an analyst at Okasan Securities, told Reuters news agency.
“On the balance sheet, it doesn’t matter if the funds are private or public.”
Reports also said that Nissan was considering various types of government aid.
US carmakers General Motors and Chrysler have received $17..4bn from the US government.
Toyota ended GM’s 77-year reign as the world’s largest carmaker last year as its sales surpassed its US rival.