Business news for Thu, 29 Nov 2007 & with words despite+profits. 5 news.

After 15 years of gloom, Japan's companies have emerged with a new, hybrid model a bit closer to America's, says Tom Standage ONCE it was the Walkman. Then it was the PlayStation. Today it is the Toyota Prius that epitomises Japan's technological and industrial prowess. Built by Japan's largest company, which is now on the verge of becoming the world's largest carmaker, the Prius is a hybrid car propelled by the combination of a petrol engine (for range) and an electric motor (for energy-efficiency). The Prius was the first commercial hybrid car and has become by far the most successful, with sales of over 1m since its launch in 1997. Although that is a modest figure compared with Toyota's annual output of around 8m vehicles, it has transformed the company's image. Toyota is now known for greenery and innovation as well as manufacturing efficiency. But the Prius also symbolises another transformation: that of Japan itself. Just as a hybrid car combines the distinct advantages of petrol and electric propulsion systems, Japan has been developing a new hybrid model of capitalism that brings together aspects of the old Japanese model, which ran into trouble in the early 1990s, with carefully chosen elements of the more dynamic American or Anglo-Saxon variety of capitalism. The resulting hybrid model has been adopted by many firms and has already helped to transform Japan's fortunes. After wrenching political and corporate reforms, the country in 2002 emerged from over a decade of economic stagnation. Since then the recovery, originally export-led, has spread to the economy as a whole (see chart 1). Japanese firms have restructured, paid down their debts and are now posting record profits. The banking system has been cleaned up. Yet despite this progress, Japan still faces huge problems. ...

Love them or hate them, Germany's two power giants keep the lights on IN AN apparent victory for the little man, the burghers of Ensdorf this week successfully blocked plans by RWE, a huge German power company, to build a spanking new coal-fired power station in their back yard. But those Saarland villagers have won an incomplete victory. Germany needs to add about 35,000 megawatts (MW) of new capacity by 2020, plus another 16,000MW if its nuclear plants are to be phased out by then, as planned. So new power stations will have to be built somewhere. RWE and E.ON, the other German power giant, are treading on eggshells these days. Their duopoly over electricity generation and distribution in Germany is under attack from almost every quarter: the European Commission, the Federal Cartel Office, the Federal Network Agency and, of course, consumers. People are livid that the two giants recently announced price rises of 7-10% for next year, despite record profits in the first three quarters and windfall gains from CO2 emission certificates that they were given free. ...

Despite the uncertainty over a holiday shopping season that threatens to squash retail profits in a melee of discounting, some executives and directors are finding bargains in their companies' beaten down stock.

Shares in Alliance & Leicester, the UK mortgage bank dogged by worries about its exposure to the credit crunch, jumped 13 per cent this morning despite its warning that operating profits will be lower than forecast this year.

OMG, the company behind the motion-capture technology used to create the eye-boggling graphics for 3D film Beowulf and the upcoming The Golden Compass, has posted a record profit despite its substantial investment in two new start-up businesses over the past year.