Monday, December 22, 2008
Toyota forecasts first operating loss as sales slump
NAGOYA, Japan (Reuters) -- Toyota Motor Corp. forecast a first-ever annual operating loss, blaming a relentless sales slide and a crippling rise in the yen while declaring an emergency unprecedented in its 70-year history.
The world's biggest automaker had been expected to issue its second profit warning in less than seven weeks after domestic rival Honda Motor Co. also cut its outlook again last week, but today's downward revision was bigger than analysts predicted.
"We are facing an unprecedented emergency," President Katsuaki Watanabe told a year-end news conference today. "This is a crisis unlike the crises of the past."
The forecast compounds the global automotive crisis and comes three days after General Motors and Chrysler LLC staved off bankruptcy through a U.S. pledge for $17.4 billion in emergency loans. Automakers around the world are caught in a sharp reversal of demand as the financial crisis spreads, squeezing credit and consumer sentiment.
Toyota cut its group operating forecast to a loss of 150 billion yen ($1.7 billion) for the year ending March 31, after shocking financial markets last month by slashing its group operating profit forecast by 1 trillion yen to 600 billion yen.
It made a record profit of 2.27 trillion yen last year....More