24 Dec 2008

Toyota braced for first loss

6:07 am on 24 December 2008

Japan's biggest car,maker, Toyota, has forecast a loss of 150 billion yen in yearly operating profits - its first annual loss in 71 years. The loss is due to plummeting sales and a surge in the value of the yen.

Company chief Katsuaki Watanabe said the current downturn was of a size that came only "once in 100 years".

Japan posted a trade deficit in November of $US2.5 billion as exports fell at a record rate. Its ministry of finance says export levels are down 26.7% from a year earlier, due to the rising yen.

The car maker recorded an operating profit of 2.27 trillion yen last year. Toyota said it still expects to make a profit on a net level for the year ended March, but has cut its forecast sharply to 50 billion yen - down from a previous estimate of 550 billion yen.

It is the second profit warning by Toyota in less than seven weeks. The BBC reports the latest estimate is far lower than its net profit of 1.7 trillion yen the previous year.

President Katsuaki Watanabe said Toyoya expects to sell 8.96 million vehicles around the world this year, down 4% from the previous year.