AIG to Post Biggest Loss in U.S. History; Stocks Fall to a 12-year Low; Honda to Post First Quarterly Loss in 15 Years; Toyota Lowers Production Target
- American Insurance Group (AIG), the insurance giant that is already 80% owned by the U.S. government, is in discussions with the government for more federal funding so it can keep operating after next Monday, when it will report the largest loss in U.S. corporate history, CNBC reported. Sources close to the company told CNBC that the loss will be close to $60 billion.
- Both the Dow Jones Industrial Average and Standard & Poor's 500 Index tumbled yesterday (Monday) to their lowest levels in 12 years. The Dow fell 250.89 points, or 3.41% to close at 7,114.78 and the S&P 500 plunged 26.27 points, or 3.47%, to close at 743.33.
- No. 2 Japanese carmaker Honda Motor Co. Ltd. (ADR: HMC) – forecasting its first quarterly loss in at least 15 years – has named Takanobu Ito as its next president, Bloomberg News reported. The Tokyo-based company is watching its sales plunge in both Japan, and in the United States, its biggest market, thanks to the worst financial crisis since the Great Depression. Ito, 55, now global chief of Honda's automobile division, succeeds Takeo Fukui, 64, in June. Fukui will become an advisor to Honda.
- Toyota Motor Corp. (ADR: TMC), the world's biggest automaker, is prepared to set a 2009 production target of about 6.5 million vehicles, the lowest in six years, The Nikkei, Japan's top business daily, reported yesterday (Monday). For the fiscal year that ends in March, Toyota is skidding towards its first net loss since 1950, due to precipitous sales declines in virtually every market – including the United States, Japan, Europe and even the emerging economies of Asia, BusinessWeek said. This reversal for the Toyota City-based firm follows seven years of aggressive expansion, and has led to an onogong management shakeup. Toyota also said yesterday that three executive vice presidents were retiring in June; last month, Toyota tapped a member of the founding family, Akio Toyoda, 52, grandson of the company founder, as president, replacing Katsuaki Watanabe.