Global News: Auto Riches to Rags From Europe to Asia
By Michelle Krebs March 24, 2009In news from around the world Monday, auto magnates in Japan and Russia have seen their fortunes crippled, the outlook for Germany's economy has worsened, German automakers may pull out of the shortened Tokyo auto show and French supplier Valeo's chief executive has stepped down over a strategy disagreement.
In Japan, Toyota Motor Corp.'s founding family has lost $429 million as the value of Toyota
shares has tumbled 46 percent in the past nine months, according to Bloomberg News'
calculations.
While this is an unrealized loss since no family member has sold Toyota shares, analysts predict a likelihood of reduced dividends that will directly impact the Toyodas. Incoming President Akio Toyoda, set to take office in June, and his father Shoichiro Toyoda, honorary chairman and past president, own a combined 0.46 percent of the 3.45 billion outstanding shares of Toyota, according to filing data. When founded in 1937 by Kiichiro Toyoda, Akio's grandfather, and brother-in-law Risaburo Toyoda, they owned a combined 8 percent of the then privately held company.
In Russia, aluminum mogul Oleg Deripaska has lost 88 percent of his wealth in the past year, according to Forbes
magazine, as aluminum prices have tumbled to a seven-year low and Russian stock prices have plummeted. Deripaska, the now 53.8 percent majority stakeholder in aluminum supplier United Co. Rusal, Monday turned over 3 percent ownership to help pay off a $2.8 billion debt owed to a private investor in Rusal. Analysts expect that Deripaska will swap more equity and lose controlling share in Rusal, as the company struggles with $14 billion of debt. Forbes
estimates Deripaska's fortune was $28 billion in 2008, making him Russia's richest man at the time.
Deripaska, owner of Russian automaker GAZ, bought and sold a stake in Canadian supplier Magna International. His purchase came while Magna was making a bid for Chrysler, before Cerberus Capital Management ultimately bought the automaker. Deripaska also owned a stake in General Motors at one time and reportedly had expressed interest in buying Hummer.
In Germany, the economy is predicted to contract 3 percent to 7 percent in 2009 as recession deepens and exports plunge. Last week IHS Global Insight forecast a 3.2% decline in Germany's real GDP, while Commerzbank AG announced Monday a GDP contraction of up to 7 percent. Economic organizations RWI Institute and IMK Institute forecast GDP declines of 4.3 percent and 5 percent, respectively. The German economy has faltered partially from overreliance on exports, while recently-released statistics show exports dropped in January for a fourth straight month.
Meantime, German automakers BMW, Mercedes-Benz, Volkswagen, and supplier Robert Bosch may withdraw from the Tokyo motor show, according to Germany's Automobilwoche
. The German auto industry has been hammered by low demand domestically and abroad, with BMW announcing an 89 percent plunge in profit recently, and costs are being slashed everywhere possible.
In Japan, the Tokyo motor has been shortened by four days, Nikkei News reports. Organizers have considered cancelling the show, set for October, anticipating poor participation from automakers. While the German automakers waver on attendance in Tokyo,
the Detroit 3 have already pulled out, citing cost issues. 
In France, Valeo chief executive Thierry Morin resigned over a disagreement on company strategy, and Jacques Aschenbroich has been named successor. "This decision comes as a result of strategic differences and the will of the board to change the group's governance structure," the company said in a statement. Morin, who'd been chairman for eight years, has been named honorary chairman of Valeo "in recognition of his significant contribution to the development of the group," Valeo said.
AutoObserver's Global News report is compiled by Edmunds.com Senior Manager David Greene.
Photos
1 - Incoming Toyota Motor President Akio Toyoda
2 - Russia Oleg Deripaska
3 - 2009 Tokyo Motor Show promo
4 - Resigned Valeo CEO Thierry Morin
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