The world's largest auto maker, Toyota Motor Corp. (NYSE: TM) announced Tuesday that is was about to issue the biggest recall in the company's history, as problems with some floor mats has led to numerous accidents and at least five deaths.

The recall involves eight different models of Toyota and Lexus vehicles manufactured and sold in the U.S. over the past six years, and include the popular Prius hybrid. Apparently, there is a problem with the driver side floor mats that result in the mats coming loose and jamming down the accelerator.

Although Toyota Motor Corp. (NYSE: TM) was first out of the gate with a gas/electric hybrid vehicle back in 1997 with the Prius, the holy grail for much of the consumer automotive industry has been a 100% electric vehicle that lasts a while on a charge, is big and roomy, and has a long range.

Oh, and it must remain comparable (read: affordable) in price to its fossil fuel cousins. The former GM's Chevy Volt project was a very good stab at this (who knows where that project is heading, though), but what about world automotive leader Toyota?

The executives at Toyota Motor Corp. (NYSE: TM) must live in a world all their own. They have maintained the forecast for their worldwide vehicle sales in the face of a massive downturn in the US auto market and weakness in Japan and parts of Europe.

The big Japanese car company finally bowed to reality and cut its prediction for units sales, but not by much. According to MarketWatch, "The automaker forecast sales for the full year in the lower 9.5 million unit range, down from the previously targeted goal of 9.85 million cars and trucks."

While the revision is a defeat for Toyota, it is also an odd acknowledgment of how well its does with car sales around the world and how clever it has been in designing and marketing new cars. In the US, where most auto firms are dying, Toyota has had a smashing success with its Prius hybrid. It cannot make enough of the cars to keep up with demand.

General Motors Corporation (NYSE: GM) investors, as well as auto industry trackers, will want to read Jonathan Rauch's "Electro-Shock Therapy" in the July 2008 issue of Atlantic Magazine. Mr. Rauch was given unprecedented access to all personnel involved in GM's company-wide commitment to have a market-ready electric car by late 2010. GM personnel note the Chevy VOLT, as the car is named, will not be a hybrid per se, but will be the first mass market electric car with a range of 40 miles per charge, enough to cover the daily commute of 75% of American workers. The car's small gasoline engine will be used to recharge the battery, while only electricity will be used to power the wheels. GM is trying to wow consumers by manufacturing an affordable electric car that will sever the connection between driving and the gas pump.

GM lost the engineering and publicity wars on electric cars to Toyota's Prius years ago. Toyota has been eating GM's lunch ever sense. According to GM's VP Bob Lutz, it's payback time. Using the same rhetoric President Kennedy used to launch the Apollo space program and race to land on the moon, GM has sectioned off the Volt division and given it complete decision-making and spending authority to reinvent not only the electric automobile, but also the company itself. In one Volt engineer's words: "Go big or go home."

Yes, there are problems with the weight to power ratio in the battery. And yes, production of both the battery and the car body are being rushed towards production without the normal period of evaluation. But GM has staked its future on the Volt, and unlike my colleague Michael Rainey who isn't that positive on the Volt, there's reason for at least cautious optimism, a quality currently in short supply coming out of Detroit.

All of those green people in all of those green cars. The Toyota (NYSE: TM) Prius was a gamble when the auto company first designed and built it. The price was more than its "all gas" counterparts because the electric component of the engine was expensive to build. The Japanese firm had to bet that buyers would want to save the environment by purchasing an automobile aimed at cutting emissions.

All of that planning by Toyota worked. The Prius has now sold one million units worldwide. Reuters says that the car company said "Toyota believes that Prius vehicles worldwide have contributed to a reduction in carbon dioxide emissions by producing approximately 4.5 million tonnes less CO2 when compared with gasoline-powered vehicles in the same class and of similar size and driving performance."

And who is to say that the calculation is wrong, at least by much.

Toyota has once again put its competition in a situation where they have to catch up. When the company began to produce almost flawless cars 20 years ago, Detroit and Europe had to up their quality to stay in the game. Now they will need to aggressively follow Toyota into the hybrid market.

Being first to market sometimes has its advantages.

Douglas A. McIntyre is an editor at 247wallst.com and author of the Ten Stocks Under $10 letter.

NASCAR may be a good place to test engines, but the three U.S. car-makers all maintain budgets for the wild races that top $100 million each. A Chrysler executive quoted by Reuters explained the love affair by saying that "there are still 75 (million) to 80 million NASCAR fans out there ... and being in the automobile business, this is exactly the types of folks we want to be talking to."

For companies like General Motors Corp. (NYSE: GM) and Ford Motor Co. (NYSE: F), who count on middle America and pickup buyers for most of their sales, the venue is probably priceless. It is notable the the more successful Japanese manufacturers tend to keep a lower profile. While GM's U.S. market share is 25% overall in the domestic market, the car company says that number is closer to 40% among NASCAR fans.

It is, in almost every way, an example of what is wrong with Detroit. The companies love marketing to themselves. With their market shares at the lowest level in years, they are probably already down to their core customers bases. Rolling out pickups for the "good old boy" segment of the market doesn't do them much good.

They should be trying to win over people who own a Prius.

Douglas A. McIntyre is an editor at 247wallst.com.

Oil recently climbed up to that magic number: $100 a barrel. Along with it, Toyota Motor Corporation (ADR) (NYSE: TM) has risen to new heights, getting ready to possibly take #1 car manufacturer here in the USA.

Back in April 2005, Eric Wahlgren of Business Week, wrote about the then unthinkable prospect of oil hitting $100 a barrel. In that article I suggested that Toyota Motor Corporation (ADR) (NYSE: TM) might benefit if oil prices rose. That's because it seemed to be taking the lead in making hybrid vehicles. Even though its Prius only accounted for a small portion of its sales, I thought it would keep pushing ahead of its U.S. competitors due to its higher quality, higher prices, and lower costs.

Today, according to The Associated Press, Toyota surpassed Ford Motor Company (NYSE: F) as the U.S.'s second largest vehicle manufacturer. Ford has been in second place since 1931. And the global sales tallies are yet to be completed, however, The Associated Press reports that Toyota -- which estimates that it made 9.51 million vehicles in 2007 will surpass General Motors Corporation (NYSE: GM)'s total of 9.284 million vehicles for 2007.

Since April 26, 2005 when the Wahlgren article was published, Toyota stock has risen 47% while General Motors stock is down 11% and Ford has fallen 35%. Concerns about Toyota overtaking U.S. auto manufacturers' global lead have persisted for about 25 years. Despite occasional efforts by GM and Ford to stop Toyota's inexorable advance, Toyota is now the world leader.

And its prescient response to $100 a barrel oil is helping Toyota to extend its lead.

Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.

Toyota (NYSE: TM) posted a 2.9% increase in operating profit on cost cuts and a stronger dollar. Sales success in areas outside the U.S., including Russia and China, are likely to give the Japanese company its seventh straight year of record profits. Toyota sales in the U.S. and Japan were down a bit due to weak overall car sales in both countries.

According to Reuters, "Second-quarter net profit grew 11.1 percent to 451 billion yen, as stronger sales in Europe, Asia and other markets eclipsed the slide in the United States and Japan, Toyota's two biggest markets. Revenue rose 11.2 percent to 6.49 trillion yen."

The earnings results serve as a reminder that Toyota is still, by far, the world's strongest car company. Its recent stock price drop, recalls, and downgrade in the Consumer Reports quality survey led the market to think that the company's dominance of its industry might start to fade. The firm's latest earnings report is likely to mute that kind of talk.

Toyota is doing well because it has been adroit at entering new markets with its current cars, like the Camry. These models are inexpensive, use less gas than most, and are still highly reliable. They are products that depend very little on trying to change tastes in each market.

The company has also been ahead of the trend with alternative energy cars like the Prius, which has become a very big seller for Toyota.

Toyota may be having a bad turn, but it is still a number of steps ahead of the competition.

Douglas A. McIntyre is an editor at 247wallst.com.

Japanese automaker Toyota (NYSE: TM) stole the hybrid vehicle marketing limelight years ago with its Prius passenger car -- you know, the one that has a gas mileage figure of over 50 miles per gallon. Due to combining a smaller gasoline engine with an electric motor, the smaller car has a remarkable fuel efficiency rating, and the word of mouth that started selling the Prius to ecologically-aware consumers and assorted environmentally-conscious folks was like a wildfire in the passenger car market. The waiting line to buy one was half a year in many cases.

Although many detractors say the Prius' claimed gas mileage is not what it's cracked up to be, the popularity contest has already been won. The next step for Toyota would be to make the nameplate in an all-electric fashion instead of a hybrid design that still uses gasoline. The trouble is, no company can produce an all-electric car that has the same amenities as the modern internal combustion vehicle: range, comfort, size, price and design. If anyone can ever make this a reality, though, it would be Toyota (although an effort is still plenty of years off).

Until then, perhaps the automaker is looking at plug-in electric hybrid vehicles for Act II of its hybrid car marketing strategy? At the recent Tokyo Auto Show, Toyota showed off designs that use a hybrid propulsion system that contains a larger battery, allowing the vehicle to travel short distances at highway speeds powered by the electric motor alone, instead of the motor just being used in city stop-and-go traffic. The battery pack would need recharging at night, instead of being charged by regenerative braking like in current designs, but all things considered, this would be the next step to an all-electric design that uses little to no internal combustion (or gas). Whoever gets there first will hold the holy grail of sales to customers needing smaller passenger cars. General Motors (NYSE: GM) isn't sitting still at all, though.

A down side for hybrid cars -- Apparently, Toyota Motor Corp's (NYSE:TM) Prius and other such gas/electric vehicles are not popular among one segment of Americans, the visually disabled. The National Federation of the Blind has asked that the vehicles be equipped with some sort of warning noise so that the sight-impaired can avoid stepping in front of the almost-silent cars. I wonder what can be done to help the iPod impaired, who often aren't aware of approaching fire engines until the bumper hits them in the ass.

Another interesting transportation story comes to us from the bicycle-crazy Netherlands. The new Bikedispenser is a fully-automated bicycle rental station. Much like the baggage cart rentals in airports, Bikedispenser stores 50 or more all-purpose bikes, ready to pop one out to the customer that scans his/her debit card. The company expects to install the machines at train stations and other public transportation hubs.

In the category of fun --- How much time could I waste on the web site J! Archive? The right answer is tons. The site has compiled all of the Jeopardy! game show questions, player answers, and real answers for the entire run of the show, since 1983, over 110,000 questions in all.

Finally, hairdresser Lee Becks thought he was getting a tattoo of the Mandarin characters for "Love, honor and obey." To his dismay, he found, after the fact, that the lettering on his arm actually translates as "At the end of the day, this is an ugly boy."
via cantonese.sheik.co.uk

Nissan Motor Co., Ltd. (NASDAQ: NSANY) really wants to come out with new hybrid and all-electric vehicles in the next few years. However, throw out the terms biodiesel and ethanol at the Japanese automaker and you'll probably receive a scornful look back. Does Nissan want to bet on the all-electric vehicle instead of mixed-propulsion methods like combustion based on ethanol and biodiesel? You bet.

As many critics have pointed out (and there is quite a bit of validity to this), the economic returns on the uses of those two alternative fuels are not that good, even with foreign oil prices being at the level that they are currently. Nissan officials said this week that designing an ethanol or biodiesel car is fairly straightforward in a technical sense. Yet, the cost of the fuel and the resources needed to distill it into a form usable by these alternative-fuel engines would outpace regular gasoline with all variables considered.

Are you ready to actually pay more to travel in order to use a non-oil form of fuel? That's what Nissan execs are hinting out here, even as E85 vehicles continue making inroads with competitors like General Motors Corp. (NYSE: GM) and others. The costs of using cropland for fuel production instead of food production are also on the minds of many (in the case of ethanol). But electric cars -- today -- are nowhere near close to replacing internal combustion vehicles in terms of performance or cost. Nissan, though, hopes that they will be in the next decade or two. Right now, the automaker sees its first mass-produced electric car in 2011 or 2012.

Last week I wrote about GM's plans to bring its hybrid Volt to market in 2010. As I mentioned in that post, the competitors won't be standing around waiting for General Motors (NYSE: GM) to catch up. In fact, Honda (NYSE: HMC) and Toyota (NYSE: TM) are already preparing for a 2009 green-on-green smackdown.

According to Newsweek, both corporations have big plans to grab a lion's share of the green market. Honda, still licking its wounds over the failure of the hybrid Accord, is pulling that model out of their green lineup. To take its place, the company will introduce an entirely new marquee, one that will (hopefully) outrun the Prius in fuel efficiency and price. The company hopes to sell 100,000 of this model a year, a quantum leap beyond its current hybrid sales.

Toyota, the clear leader in the field to date, is treating its Prius as a new brand, much as it did with the Scion line. By 2009, look for compact, midsized and crossover models under the Prius moniker.

J.D. Powers estimates that by 2011 there will be 75 hybrid models in America's showrooms. And I'm betting every one of them will be better looking than Honda's original ugly mutt hybrid, the discontinued Insight.

J.D. Power and Associates said that 187,000 hybrids were sold in the first half of 2007, according to USA Today, which accounted for a minuscule 2.3% of all new vehicle sales. Despite the recent slowdown in auto sales, the auto information company expects total sales of 345,000 hybrids for the year, a 35% jump from 2006.

The best-selling hybrid model continues to be the Toyota (NYSE: TM) Prius, which accounted for just over half of all hybrids sold. J.D. Power told the newspaper that Prius sales received a boost from incentives of up to $2,000 per vehicle, which offset the drop in federal tax breaks for hybrids this year. Incentives were something Detroit and the "Big Three" were hoping to avoid this summer, and became one of the main reasons domestic market share fell below 50% for the first time in history.

In the next few years, the competition in the hybrid segment will intensify. J.D. Power estimates there will be as many as 65 hybrid models in the market by 2010, with more than half of them being trucks. It also projects sales of nearly 750,000 units, nearly double the expectations of 2007.

What's not shocking to read is that Toyota, a foreign car manufacturer, holds top billing in hybrid sales. American manufacturers again are late to the game. What is shocking is that despite soaring gas prices, hybrid sales totaled a meager 2.3% of all new vehicles. In three years projections push this out to 5%, which is still too low. If Americans want to complain about high gas prices and how they can't take the pain of paying $3.50 a gallon every week, maybe they should do something proactive and buy a hybrid.

Both General Motors Corp. (NYSE: GM) and Ford Motor Co. (NYSE: F) have hinted recently at more hybrid vehicles entering the global auto pipeline from both manufacturers. This is no surprise; customers are dealing with high gas prices every day now (with little to no relief in sight) and auto manufacturers are responding with hybrid auto technology to fill the customer need for better MPG (miles per gallon). Although Toyota Motor Corp. (NYSE: TM) has been at the forefront of marketing so far (with its Prius hybrid, for example) and GM and Ford are pushing hybrid technology as well, what about other manufacturers?

Nissan Motor Co. (NASDAQ: NSANY) CEO Carlos Ghosn, who has been given credit for completely revitalizing and saving Nissan from complete failure back in 2001 or so, indicated yesterday that the company he leads is working hard to develop the next generation of smaller, lighter auto batteries. This move will make Nissan (hopefully) more competitive in the technology field that is sure to be used more and more in the future for not only auto batteries, but 100% electric-powered vehicles as well.

Nissan's specific move here is to have the smaller, more efficient and lighter lithium-ion battery technology currently used in cell phones and laptop computers used in passenger cars and trucks. In terms of Nissan vehicles that use hybrid technology, the current lineup includes the 2008 Nissan Altima. That car -- one of the most popular in all of Nissan's product portfolio -- has a hybrid option that uses older Nickel Metal Hydride technology that Nissan licenses from competitor Toyota. If Ghosn does not only get the newest generation of automotive batteries to market faster than the competition -- and possibly make Nissan vehicles with that technology on board -- Ford and GM may become customers as both domestic automakers strive to get a more solid footing in the hybrid vehicle market.