Toyota Posts First Loss Since 1950
A feature of Toyota’s (TM) rise to the top of the auto world in the past few years was its ability to meet and beat seemingly stiff targets year after year. These days, it seems to be just the opposite. On May 8 in Tokyo, Toyota chief Katsuaki Watanabe marked his final annual results presentation as president by announcing the company’s first loss since 1950. At $4.4 billion, the red ink was worse than the $3.5 billion loss Toyota had projected in February and a massive $21.7 billion less than the $17.7 billion of profit Toyota booked a year ago, before the global financial crisis took hold. “Both revenues and profits declined severely,” Watanabe told reporters.
And things are looking to get worse for the automaker. Despite projected cost cuts of up to $8 billion, losses could rise to $5.5 billion. Sales are down 21% and projected to fall another 20%. However, Toyota has no plans right now to shut down plants.