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Toyota Motor Corp. seems to be in big trouble. The Japanese automaker forecasts a first-ever annual operating loss blaming the huge decline in demand and the rise in the yen.

“We are facing an unprecedented emergency,” President Katsuaki Watanabe told a year-end news conference yesterday. “This is a crisis unlike the crises of the past.”

Toyota cut its group operating forecast to a loss of 150 billion yen ($1.7 billion) for the fiscal year ending March 31. That’s compared to the record profit of 2.27 trillion yen it announced last year.

As with the rest of the auto industry, Toyota has delayed projects, halted production at its plants and cut executive bonuses. It said those moves “will continue until the tide turns.”

Watanabe did not project any sales or earnings figures for next year saying that Toyota hopes to return to profit and cut capital spending to below 1 trillion yen next year.

Source: Reuters

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