Toyota sees first operating loss as sales slump

Toyota Motor Corp, the world's biggest automaker, on Monday forecast its first ever group operating loss due to a relentless global slide in car sales and a crippling rise in the yen.
Toyota had been expected to issue its second profit warning in less than seven weeks, after domestic rival Honda Motor Co also took the rare step of altering its guidance outside the usual quarterly reporting season, but the downward revision was bigger than predicted.
"This is very, very, very bad," said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments. "There's a chance they could fall into the red in the next business year as well.
"This is also not just a problem for Toyota. What is good for Toyota is good for the Japanese economy."
Automakers around the world face their toughest business environment in recent memory, caught in a sharp reversal of demand as the financial crisis spread globally, squeezing credit and consumer sentiment.
Toyota, one of the fastest-growing major automakers until last year, has been particularly vulnerable after it rushed to add production capacity that quickly became redundant.
Toyota has idled factories, slowed assembly lines and delayed manufacturing projects, such as the start of a new Mississippi plant under construction to build the Prius hybrid model.
RECORD LOSS
Toyota cut its group operating forecast to a loss of 150 billion yen ($1.7 billion) for the year to end-March, 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 operating profit of 2.27 trillion yen last year.
Analyst forecasts on Reuters Estimates ranged from a loss of 150 billion yen at the low end, to a profit of 800 billion yen for figures not updated since conditions deteriorated in the past month.
Toyota now expects group net profit of 50 billion yen instead of 550 billion yen.
Toyota made the announcement at its annual year-end news conference attended by its top executives.