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Mighty Toyota Posts Its First Loss Ever

Even Prius can't overcome flagging demand, soaring yen

By Jason Farago,  Newser Staff

Posted Dec 22, 2008 6:08 AM CST
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(Newser) – Toyota will post a loss for the first time in its history, the victim of plummeting sales and multi-year highs in the value of the yen, the company warned today. The Japanese automaker, which has enjoyed a reputation for profits even in bad times, announced that it would suspend executive bonuses and rejigger its dividend payout. "Unfortunately, I cannot see now where the bottom will be," said Toyota's CEO, who predicted a $1.67 billion loss.

Toyota has always been a much leaner operation than the Big Three, and its hybrid Prius has become one of the hottest cars on the market, but the economic downturn that has brought Detroit to the brink has affected Japanese makers as well. Reacting to the announcement, Moody's said it would review its rating of Toyota, now at triple-A.

Toyota President Katsuaki Watanabe ponders before answering a question during the year-end press conference at Japan's leading automaker's office in Nagoya, central Japan, Monday, Dec. 22, 2008.
Toyota President Katsuaki Watanabe ponders before answering a question during the year-end press conference at Japan's leading automaker's office in Nagoya, central Japan, Monday, Dec. 22, 2008.   (AP Photo/Katsumi Kasahara)
The company logo hangs over the hood of an unsold 2009 FJ Cruiser at a Toyota dealership in Frederick, Colo., Thursday, Nov. 27, 2008.
The company logo hangs over the hood of an unsold 2009 FJ Cruiser at a Toyota dealership in Frederick, Colo., Thursday, Nov. 27, 2008.   (AP Photo/David Zalubowski)
Unsold Corollas and Matrixes sit at a Toyota dealership in Centennial, Colo., on Sunday, Nov. 2, 2008. Toyota dropped 23% in October as low consumer confidence and tight credit scared customers away.
Unsold Corollas and Matrixes sit at a Toyota dealership in Centennial, Colo., on Sunday, Nov. 2, 2008. Toyota dropped 23% in October as low consumer confidence and tight credit scared customers away.   (AP Photo/David Zalubowski)
Toyota President Katsuaki Watanabe ponders before answering a reporter's question during the year-end press conference at Japan's leading automaker's office in Nagoya, Monday, Dec. 22, 2008.
Toyota President Katsuaki Watanabe ponders before answering a reporter's question during the year-end press conference at Japan's leading automaker's office in Nagoya, Monday, Dec. 22, 2008.   (AP Photo/Katsumi Kasahara)
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