The document compares key financial metrics of Toyota for 2017 vs 2016 such as liquidity, solvency, and profitability ratios. It also compares Toyota's ratios to its main competitor, Ford. Additionally, it discusses Toyota's cash-to-cash cycle and various past and present joint ventures with companies like Mazda, Subaru, BMW, and Tesla. It briefly outlines a large frame damage settlement by Toyota and issues surrounding an unintended acceleration recall from 2010.

1. Toyota

2. Ratios
Profit Margin, Inventory Turnover, Current Ratio, etc.

3. Toyota
2017vs2016
Liquidity 2017 2016
Working Capital $4,581 $18,557
Current Ratio 1.03 1.13
Inventory Turnover 9.68 10.22
Days in Inventory 37.70 35.72
A/R Turnover 12.54 12.92
Avg. Collection Period 29.10 28.24
Solvency 2017 2016
Debt to Assets 61.7% 61.9%
Free Cash Flow $16,741 $29,405

4. Toyota
2017vs2016
Profitability 2017 2016
Earnings per Share $5.39 $6.60
Gross Profit 16.5% 19.2%
Profit Margin 7.9% 10.5%
Return on Assets 4.6% 6.3%
Asset Turnover 0.57 0.60

5. Ford
Main Competitor

6. Liquidity Toyota Ford
Working Capital $4,581 $18,180
Current Ratio 1.03 1.20
Inventory Turnover 9.68 14.70
Days in Inventory 37.70 24.80
A/R Turnover 12.54 2.96
Avg. Collection Period 29.10 123.10
Solvency 2017 2016
Debt to Assets 61.7% 87.7%
Free Cash Flow $16,741 $9,424
Toyota
vs
Ford

7. Profitability Toyota Ford
Gross Profit 16.5% 10.6%
Profit Margin 7.9% 4.5%
Return on Assets 4.6% 2.9%
Asset Turnover 0.57 0.66
Toyota
vs
Ford

8. Cash 2 Cash Cycle
Inventory Cost Method

9. C2C
Toyota
What is C2C?
▪ Amount of time, in days
▪ Paying cash for raw materials
▪ Receiving cash from customers
How to impact C2C?
▪ Extend average A/P
▪ Reduce inventory by reducing the production cycle
▪ Decrease average A/R

10. C2C
Toyota
What does 25 days mean?
▪ Represents the time it takes for a dollar to flow back into your
company after it has been spent on RM.
▪ Major Metric to determine how well your company is managing the
financial flows from both suppliers and customers.
▪ Determines how much liquidity a company needs.
▪ The longer the C2C cycle, the more net working capital required.
How to impact C2C?
▪ Extend average A/P
▪ Reduce inventory by reducing the production cycle
▪ Decrease average A/R
25

11. Joint Ventures

12. Toyota&Mazda

13. NewJoint
Ventures

14. Toyota &
Mazda

15. Mazda,
Toyota &
Denso

16. Toyotaand
Subaru
▪ Started in April 2008.
▪ Subaru transferred 16.5% of issued shares to Toyota in
July 2008. Production of Toyota vehicles at Subaru plants
ceased in May of 2016.

17. Toyotaand
BMW
▪ Collaborations started in the research of Lithium-Ion
batteries and BMW to supply Diesel engines to Toyota
Europe.

19. Toyota&Suzuki
▪ Started in 2017 to include environmental, safety,
information technologies as well as mutual supply of
components.

21. ToyotaandTesla

22. Toyota &Tesla
&Panasonic

23. JointVenturethat
wasnotwas
unsuccessful
▪ Toyota & GM

24. OldJointVenture
Toyota & GM

25. FrameDamage?!?

26. Framesettlement
▪ According to Reuters, Toyota has reached a settlement in
a class action lawsuit involving owners of various Toyota
trucks with severe frame rust. The settlement is for $3.4
billion and will pay for inspecting and replacing frames on
affected trucks. It also allows Toyota to avoid admitting
any wrongdoing. In total, this settlement could include 1.5
million 2005-2010 Toyota Tacomas, 2005-2008 Sequoias,
and 2007-2008 Tundras. Reuters reports that vehicles are
eligible up to 12 years to the day that they were
sold. The Wall Street Journalreports that Toyota will reach
out to owners via mail, notices to publications, and
internet methods.

27. What‘sthebigdeal?!

28. WhatRecall?!

29. Unintended acceleration (oops!)
▪ The automaker expects its global recall related to faulty
accelerator pedals — and the sales and production suspension
that resulted — to cost about $2 billion or 180 billion yen.
Earlier in the week, analysts pegged the cost at about $1.1
billion but pointed to future brand damage as an additional
price.
▪ 2010*