December 2008 Car News - GBCarLoans.com

22nd December 2008

The crisis facing the world's automotive industry deepens.

Toyota, one of the global elite, revealed it was on course to record its first operating loss in more than 70 years. Toyota Japan's biggest car maker, has forecast its first annual loss in 71 years due to plummeting sales coupled with a surge in the value of the yen.
The firm said it expected a loss of 150bn yen (£1.1bn) in yearly operating profits - from its core operations.

Company chief Katsuaki Watanabe said the current downturn was of a size that came only "once in a hundred years".

Japan's exports posted a trade deficit in November of $2.5bn (£1.7bn). The rising yen saw export levels down 26.7% from a year earlier, the ministry of finance said. The carmaker had recorded an operating profit of 2.27 trillion yen last year.

It is the second profit warning by Toyota in less than seven weeks.

Toyota said in a statement it was cutting its profits forecast because of the soaring yen "as well as a review of sales plans following a faster than expected contraction of the auto market".

Toyota's president Katsuaki Watanabe said the company now expected to sell 8.96 million vehicles around the world this year, down 4% from the previous year. The drop in vehicle sales over the last month was "far faster, wider and deeper than expected", he said. Mr Watanabe gave no sales goal for 2009. The company stated it will have to cut thousands of temporary workers' jobs at its plants in Japan, but its full-time employees will be protected.

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