First loss for Toyota in 59 years

TOYOTA, THE world's biggest car firm, reported a 766 billion yen (€5.74 billion) loss for the first three months of the year, forcing the firm into its first annual loss in 59 years.

Reflecting the increasingly dire situation of the global auto market, the Japanese car giant reported an annual net loss of 436.6 billion yen (€3.27 billion) for the year to March 31st.

It also predicted this year's losses may total 550 billion yen (€4.12 billion), almost twice what analysts were expecting. With the global car market recording dramatic double-digit falls in sales, Toyota is suffering a similar fate to the other car giants.

Its losses for the three months to March exceeded those of either Ford or embattled General Motors.

However, the situation at Toyota remains some way off the perilous state of either Chrysler, which has filed for bankruptcy protection, or GM, which has been given until June 1st to avoid a similar fate.

The US recession has hit Toyota hard, as it had done particularly well there in the last decade, recording significant growth for both its mainstream models and its premium Lexus brand.

Globally the firm has been forced to cut significantly production and several of its factories now stand idle as distributors and dealers attempt to sell on sizeable inventories.

Toyota's outgoing president Katsuaki Watanabe was downbeat about the immediate future, declining to say when sales might pick up in major markets, or when the company would return to profitability and overcome its excess capacity.

"Of course the external environment doesn't help, but we were lacking in the scope and speed of dealing with various problems and issues, and for that I am sorry," he told a news conference.

He predicted the total US auto market for all firms would be about 10 million vehicles at best this year, down from more than 13 million in 2008.

Mr Watanabe is due to be replaced as company president next month by Akio Toyoda, grandson of the firm's founder.

Mr Toyoda will be responsible for reviving sales and cutting costs as rising unemployment and falling wages in the US, Europe and Japan affect sales.

In Ireland, where Toyota is handled by an independent local franchise, the mainstream brand lies second place in terms of sales, behind Ford. It had 5,274 new cars registered up to the end of April, representing a 64.2 per cent drop from the 14,751 sales during the same period last year. - (Reuters/Bloomberg)