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Toyota Looks Abroad, BP Sweetens the Pot
February 5, 2008
NEWS AT A GLANCE
Toyota profits rise, growth slows
Toyota, locked in a race to overtake GM as the world’s top automaker by sales, reported a 7.5 percent rise in quarterly profits, to $4.3 billion, but warned of slowing growth. The quarter’s profit was Toyota’s largest ever for a third quarter, but the percentage gain was the smallest in a year. (AP in Yahoo! Finance) Looking ahead, Toyota said that increased sales from China, Russia, and other emerging markets would only partly make up for slowing U.S. demand and the strengthening yen. “Cars sold in India and China are cheap and have smaller profit margins,” said Yuuki Sakurai at Fukoku Mutual Life Insurance in Tokyo. (Bloomberg)
BP misses target, raises dividend
Oil giant BP, Europe’s second largest company, reported a 53 percent rise in fourth-quarter profits, to $4.4 billion, which fell short of analysts’ expectations. (MarketWatch) Refining outages and rising costs dragged BP’s full-year profit down 5.5 percent, but oil output rose for the first time since 2005, as new fields in Angola, Trinidad, and the Gulf of Mexico came online, and the firm raised its dividend by 31 percent. BP shares rose in London early today. (AP in Yahoo! Finance) “The numbers are disappointing,” said analyst Peter Hitchens at Seymour Pierce, “but I think that is more than made up for by the fact that we have got a step change in the dividend.” (Reuters)
United adds bag-check fee
United Airlines said it is adding a $25 fee to check a second piece of luggage on domestic flights, becoming the first large carrier to charge for the service. United Milage Plus frequent fliers with at least “premium” status won’t be charged, nor will passengers on most international flights. (The Denver Post) The fee, attributed to rising fuel costs, applies on flights leaving May 5 and beyond. Analysts say other airlines will likely follow suit. (Bloomberg) “Everybody is chiseling away at everything that you thought you deserve,” said Bestfares-dot-com CEO Tom Parsons. “But people shouldn’t be upset because we still want to fly coast to coast for $199.” (Los Angeles Times, free registration)
Green habits, not greenbacks
A growing number of consumers are looking to cut back on their “carbon footprint,” and that means buying less. But by trying to reduce their greenhouse gas emissions—and lower their expenses as they weather the hangover at the end of the cheap-credit binge—green consumers might also be hampering efforts to fend off an economic slowdown. The new frugality could render ineffective the stimulus package wending its way through Congress, for example, which relies on free spending. “You know there’s a shift, when drinking tap water is cooler than drinking Pellegrino or Evian,” says trend forecaster Faith Popcorn. (BusinessWeek.com)
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