Toyota could be heading for its first annual loss in 71 years because of falling sales. In perhaps the strongest indication yet that the automotive industry is in serious trouble, Toyota said it expected a loss of 150bn yen (£1.1bm) in yearly operating profits – from its core operations.
The carmaker’s plight has not been helped by the rising yen, which has seen export levels down 26.7% from the previous year. It has been forced to slash its net forecast by 90% to 50bn yen, meaning it will barely break even.
In a bid to battle the global economic crisis the manufacturer has now had to cut production, slashed earnings forecasts and layed off temporary and part-time workers.
‘The change that has hit the world economy is of a critical scale that comes once in a hundred years,’ Toyota's president, Katsuaki Watanabe, told reporters at the company's headquarters in Nagoya.
The economics minister, Kaoru Yosano, said he found it ‘difficult to imagine’ that Japan would see an improvement in the near future given the desperate state of the global economy.
When asked whether there was likely to be any improvement, he replied: ‘God only knows. Now is not the time to talk about a bright tomorrow. For now we are focused on how to present a bleak tomorrow.’
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