Cycle News is a weekly magazine that covers all aspects of motorcycling including Supercross, Motocross and MotoGP as well as new motorcycles
Issue link: https://magazine.cyclenews.com/i/126783
Yamaha is counting on new products like the RZ350 (above) and the FJ1100 (engine shown below) to put it back in the black. Yamaha loses S~5Z milUon: President predicts strong recovery Yamaha Motor Company Ltd. released the following statement to the press in Japan and copies were sent to Yamaha dealers in Australia. We havereprinted it here in its entirety, with minor editing for clarity and style... Editor. TOKYO, JAPAN, JUNE 29 Yamaha Motor Company Ltd. announced that its net loss for the fiscal year ended April 30, 1984 was $152 million. At the same time, the company announced that it has taken all the steps necessary to assure a profit during its coming fiscal year. The company said that a re- 18 duction in its worldwide motorcycle inventory has resulted in recent healthy demand for more production which will greatly contribute to improved factory efficiency. The company stated that sales of other products, including outboard engines, Tri-Motos, four-wheelers, golfcars, and snowmobiles are all increasing dramatically and will provide a substantial profit contribution in the current year. A significant reduction in interest costs resulting from reduced inventories and receivables is also expected to contribute to a profitable fiscal 1985. In recent years. Yamaha's primary objective had been to maximize growth. But it has now adopted a more orderly and controlled approach to future growth. as spelled out in a new two-year plan which calls for profits through steady and controlled growth. As Yamaha President Hideto Eguchi has stated, "We will emphasize quality, creativity and stability, and re-educate our personnel so they fully understand this new direction." Yamaha realized certain non-recurring expenses in 1984, including promotional and distribution fees required to reduce excessive inventories; losses on the disposal of dead parts stock and' obsolete machines and equipment; compensation fees to outside contractors for dies, molds and Sales of Yamaha's new FJ line. including the FJ600. have been strong. (Below) Yamaha Motors Corp. U.S.A.'s headquarters. equipment; factory losses caused by decreases in production;losses caused by excessive inventories at overseas subsidiary companies, and foreign exchange capital losses. "We were able to reduce our deficit during each of the last six month periods due to the actions we have taken to reduce costs," said Eguchi. "Our operating loss during the rirst six months was $26 million and for the following six months, $8 million. Our loss before taxes for the first six months was $60 million, while the following six month figure was reduced to $24 million. This shows the great improvement of our profit picture. "Although Yamaha made big losses for the current fiscal year, they are all part of our restructure plan," said Eguchi. "In the meantime, we have taken all steps necessary to assure our return to health and profitability and now we are confident that these efforts of ours will bear fruit in the new year started May 1st." Eguchi also explained that the plan called for an immediate reduction in annual motorcycle production. from 2.9 million units to 1.5 million units in order to reduce excessive inventory worldwide. He added that during fiscal 1984, Yamaha wrote down its overvalued assets and accrued potential losses to insure future profitability. The principal areas of cost reduction were: I. Decrease in excessive motorcycle April 50. 1984 inventories: Japan Invemory U.S. Inventory 5/1/8.'l Targel Actual 505.000 265,000 244.000 576.000 260.000 265.000 2. Decrease in number of employees: April 50. 1984 5/1/83 Targel AClual Yamaha Motor Grp. 17.200 15.000 14.466 3. Improved operational efficiency by reorganization of factory production activities. 4. Increase in cash by elling certain real estate. 5. Reduction in account receivables and other assets (millions of dollars): 4/30/8.'l 4/30184 Improv. $314 $80 Accounts Receivables $394 Olher Assets $224 $169 $55 Despite the fact that m010rcycle sales have been good. the company has reduced its dependence on this product line by improving sales of other products and by developing and introducing new products which enjoy strong market demand. Yamaha has solved patent dispute problems with OMC, and the export of outboard engines to North America have been very successful. Among them, three, four and six-cylinder largehorsepower models have been so successful that the company cannot meet demand. Snowmobile sales in the North American market have been strong. and production for the coming season is expected to be increased further. In addition, sales of Yamaha-built DOHC l6-valve rour-cylinderengines for Toyota's main sports models continue to enjoy outstanding success. The company has established an industrial machinery division which produces and sells robots and highspeed plating equipment. The markets of North America. Europe and other developed countries have been very active for Yamaha due to the general economic recovery. In addition, current-year models have been well received by the consumer. "We are planning to increase our production from 1.3 million units per year to 1.6 million units during our current fiscal year, consistent with our policy of controlled growth," Eguchi stated. Yamaha has enjoyed good sales in both domestic and overseas markets of its two-stroke sport models such as the RZ series, especially the RZV500, which has been very popular. In the Japanese market its "Jog" scooter has been very successful, with total production of over 300,000 units already sold. Yamaha's new FZ400R is already finding success in the formula production racer category in the domestic market, and the FJ 1100 has been successful due to its unique concept