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Monday, December 22, 2008

Toyota expects first operating loss in 70 years

The president of Toyota Motor, Katsuaki Watanabe.

Toyota Motor announced Monday that it expected its first loss in 70 years in its core vehicle-making business, underscoring the way the pain from the current economic crisis was spreading across the global auto industry.

Analysts said the fact that even Toyota was stumbling pointed to still harder times ahead for other automakers.

On Monday, Toyota said it expected a loss during the current fiscal year of ¥150 billion, or $1.7 billion, from its auto operations. Toyota said that would be its first operating loss since 1938, a year after the company was founded.

A loss this year would also be a huge reversal from the ¥2.3 trillion in operating profit Toyota earned in the past fiscal year.

Toyota, the Japanese auto giant that has been neck and neck with General Motors for the status of world's largest vehicle maker, said it still expected to eke out a narrow net profit for its group, which also includes the automaker Daihatsu and the truck maker Hino.

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