Toyota 2009 Annual Report Download - page 60

Financial Section
TOYOTA MOTOR CORPORATION
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The following tables summarize Toyota’s contractual obligations and commercial commitments as of March 31, 2009:
Yen in millions
Payments Due by Period
Total Less than 1 year 1 to 3 years 3 to 5 years 5 years and after
Contractual Obligations:
Short-term borrowings (note 13)
Loans ............................................................................................ ¥ 1,115,122 ¥1,115,122 ¥ — ¥ — ¥ —
Commercial paper ...................................................................... 2,502,550 2,502,550 — — —
Long-term debt* (note 13) ............................................................. 8,949,615 2,688,324 3,589,350 1,261,893 1,410,048
Capital lease obligations (note 13) ................................................ 51,366 11,188 25,272 2,535 12,371
Non-cancelable operating lease obligations (note 22) ............... 54,161 11,567 15,457 9,503 17,634
Commitments for the purchase of property,
plant and other assets (note 23) .................................................. 110,874 50,200 34,275 10,908 15,491
Total .............................................................................................. ¥12,783,688 ¥6,378,951 ¥3,664,354 ¥1,284,839 ¥1,455,544
* “Long-term debt” represents future principal payments.
Off-Balance Sheet Arrangements
Toyota uses its securitization program as part of its funding for
its financial services operations. See note 7 to the consolidated
financial statements regarding the impact of the securitization
program on the consolidated financial statements.
Lending Commitments
Credit Facilities with Credit Card Holders
Toyota’s financial services operation issues credit cards to custom-
ers. As customary for credit card businesses, Toyota maintains
credit facilities with holders of credit cards issued by Toyota.
These facilities are used upon each holders’ requests up to the
limits established on an individual holder’s basis. Although loans
made to customers through this facility are not secured, for the
purposes of minimizing credit risks and of appropriately estab-
lishing credit limits for each individual credit card holder, Toyota
employs its own risk management policy which includes an anal-
ysis of information provided by financial institutions in alliance
with Toyota. Toyota periodically reviews and revises, as appro-
priate, these credit limits. Outstanding credit facilities with credit
card holders were ¥1,816.7 billion as of March 31, 2009.
Credit Facilities with Dealers
Toyota’s financial services operation maintains credit facilities
with dealers. These credit facilities may be used for business
acquisitions, facilities refurbishment, real estate purchases, and
working capital requirements. These loans are typically collater-
alized with liens on real estate, vehicle inventory, and/or other
dealership assets, as appropriate. Toyota obtains a personal
guarantee from the dealer or corporate guarantee from the
dealership when deemed prudent. Although the loans are typi-
cally collateralized or guaranteed, the value of the underlying
collateral or guarantees may not be sufficient to cover Toyota’s
exposure under such agreements. Toyota prices the credit facili-
ties according to the risks assumed in entering into the credit
facility. Toyota’s financial services operation also provides financ-
ing to various multi-franchise dealer organizations, referred to as
dealer groups, often as part of a lending consortium, for whole-
sale inventory financing, business acquisitions, facilities refur-
bishment, real estate purchases, and working capital
requirements. Toyota’s outstanding credit facilities with dealers
totaled ¥1,702.3 billion as of March 31, 2009.
Guarantees
Toyota enters into certain guarantee contracts with its dealers to
guarantee customers’ payments of their installment payables
that arise from installment contracts between customers and
Toyota dealers, as and when requested by Toyota dealers.
Guarantee periods are set to match the maturity of installment
payments, and as of March 31, 2009, ranged from one month to
35 years. However, they are generally shorter than the useful
lives of products sold. Toyota is required to execute its guarantee
primarily when customers are unable to make required payments.
The maximum potential amount of future payments as of
March 31, 2009 is ¥1,570.4 billion. Liabilities for these guarantees
of ¥5.3 billion have been provided as of March 31, 2009. Under
these guarantee contracts, Toyota is entitled to recover any
amounts paid by it from the customers whose obligations it
guaranteed.
Contractual Obligations and Commitments
For information regarding debt obligations, capital lease obliga-
tions, operating lease obligations and other obligations, includ-
ing amounts maturing in each of the next five years, see notes
13, 22 and 23 to the consolidated financial statements. In addi-
tion, as part of Toyota’s normal business practices, Toyota enters
into long-term arrangements with suppliers for purchases of cer-
tain raw materials, components and services. These arrange-
ments may contain fixed/minimum quantity purchase
requirements. Toyota enters into such arrangements to facilitate
an adequate supply of these materials and services.