Toyota posts first loss in 70 year history

Monday 22nd December 2008

Toyota today announced a loss of over £1 billion – the first time it has failed to make a profit since its establishment in 1938.

The Japanese carmaker is forecasting a 150 million yen (£1.2 billion).

Last year the firm saw a record profit of 2.27 trillion yen.

Just last month, the markets were shocked when Toyota announced it expected a 600 billion yen profit.

Toyota is seen as one of the most efficient carmakers, but even it has been caught out by the credit crisis quashing demand from consumers.

Last week the Bank of Japan cut interest rates to just 0.1 per cent to aid the troubled Japanese economy.

Honda, last week, announced a 67 per cent cut to its annual profit forecast. It also moved to batten down the hatches and stepped away from non-urgent investments – such as its Formula 1 racing team – to maintain its financial position.

Japanese tyre maker Bridgestone Corp also today cut its operating profit forecast for 2008 by 24 per cent.

In the UK, Indian owners of Jaguar Land Rover are expected to pump ten of millions of pounds into the carmaker as a short-term measure as the government mulls help.

In the US, General Motors and Chrysler took a three-month government loan of $17.4 billion (£11.6 billion) as they restructure.

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