Toyota Motor, the world's top automaker, announced on May 8 a $4.4 billion annual loss, its first ever, and warned it would plunge deeper into the red as car sales collapse during the recession. It is the first time that Toyota has finished a year in the red since it started publishing results in 1941.
Toyota lost 765.8 billion yen (US$7.7 billion) in the quarter to March alone, even more than General Motors, as it idled plants to ride out the biggest crisis in its more than 70-year history.
Company president Katsuaki Watanabe blamed the weak performance on a slump in vehicle sales, particularly in the U.S. and Europe, as well as a stronger yen and higher raw material costs.
Last year the company saw a record profit of 1.72 trillion yen.
The company, which unseated General Motors last year as the world's top selling automaker, logged an annual operating loss of 461.0 billion yen, against a year-earlier profit of 2.27 trillion yen. Revenue slid 21.9%.
Toyota actively expanded its global production facilities in recent years to meet brisk demand, particularly for its fuel-efficient cars, leaving it vulnerable to the current collapse in worldwide sales.
The maker of Prius hybrids and Corolla compacts saw its global sales fell 15% to 7.57 million vehicles last year.
It expects an even worse performance in the current business year to March -- a net loss of 550 billion yen and an operating loss of 850 billion yen. Vehicle sales are expected to sink to 6.5 million.
"We believe the current difficulty will persist for a while," said Watanabe, who will soon be replaced by Akio Toyoda, the grandson of the automaker's founder.
While the Chinese and Indian markets are showing signs of recovery, the outlook for most of the world remains uncertain, he said.
The company plans to expand its line up of fuel-sipping hybrid cars and cut costs as part of efforts to return to profit.
The Japanese company has idled plants and slashed thousands of temporary jobs in response to its biggest ever crisis. Industry analysts say the new president, Toyoda, will probably have to announce more drastic steps when he takes over. The founder's grandson is seen as someone who can unite the company during the current crisis and take some tough decisions about its future.
Toyota did not announce any new steps to overhaul its operations but said it aimed to reduce costs by 800 billion yen this year.
Copyright Agence France-Presse, 2009
