Toyota Sales Dive in China, Fiat Wants Opel from General Motors
Overseas, Toyota's (NYSE: TM) sales in China are slumping drastically due to boycott efforts of Chinese people on the Japanese automakers after the country's government made a controversial purchase of a group of East China Sea islands in September.
China is the world's largest car market, and Toyota sales were reported at 50,000 units for the month of September compared to 86,000 units one year ago. As a result, Toyota, Nissan (OTC: NSANY) and Honda (NYSE: HMC) have all had to reduce production rates and shipments to China. Although the market in China will continue to grow, the boycott and anti-Japan emotions will likely impact company profits and the value of shares.
Premarket, shares of Toyota are down 1.14 percent and up 2.48 percent for the week. Year to date, Toyota is up 15.42 percent. Shares of Honda are down 0.16 percent premarket and up 1.99 percent for the week. Year to date, shares of Honda are up 2.13 percent.
In other automotive news, Fiat (OTC: FIATY) is continuing to eye the potential acquisition of Opel from General Motors (NYSE: GM). Opel is GM's European subsidiary and has been draining GM's resources overseas, giving the company reasons to let it go.
Chrysler has been the subject of many mergers and acquisitions over the years, and has been the recipient of government bailouts as has General Motors. CEO of Fiat Sergio Marchionne is currently making a play to acquire Opel from GM for the minimum amount necessary so as to not further Chrysler's propensity towards financial troubles.
Recently, General Motors has doubted its relationship with Opel, as the company's status in the GM family depends on how well Steve Girsky can make a go of the company he voted against selling off in 2009.
As of yet, no offer has been made for GM's European arm, and the relationship would hang on GM's ending its relationship with Peugeot. While sales for Fiat have taken a dive in Europe, Marchionne is committed to rebuilding European confidence in Fiat's brand. Thanks to Chrysler's U.S. success, Fiat has the cash on hand to make such acquisitions as Opel in order to strengthen its presence overseas.
Shares of Fiat close dup 4.28 percent Thursday and are up 6.75 percent for the week. Year to date, Fiat is up 27.45 percent. General Motors closed up 1.07 percent on Thursday and are up 6.76 percent for the week. Year to date, shares of General Motors are up 21.61 percent.
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