Toyota Japan output at 31-year low

Tokyo - Toyota Motor Corp expects its output in Japan this fiscal year to fall below the level needed to maintain its full-time work force for the first time in more than three decades, a report said on Tuesday.

Toyota sees the production of 3 million vehicles as necessary to maintain its full-time work force in Japan of about 69,400. But its output is projected to be only 2.8 million units in the fiscal year through March 2010 - its first dip below 3 million in 31 years, Japan's top-selling Yomiuri newspaper said.

The company will have difficulty maintaining its level of full-time workers and may need to make some cuts, the daily reported, though it quoted one unnamed executive as saying the company would not cut the workforce at the moment.

Toyota has not laid off full-time workers since 1950.

A Toyota spokesperson could not be reached for comment.

Toyota's global output in the year will likely stay at 6.2 million units, the paper said.

To cope with faltering demand worldwide, the Japanese auto giant will continue to trim production by shortening working hours rather than suspending plant operations, it said.

Hit by plummeting sales, especially in the US, Toyota expects to incur a net loss of 350 billion yen ($3.6bn) in the previous fiscal to March 2009.

The dismal forecast - the first annual net loss since 1950 - is a huge reversal from Toyota's record ¥1.72 trillion profit in the previous fiscal year. A strong yen also hurts Toyota as it erodes the company's overseas earnings. Toyota will release its earnings reports on May 8.

Toyota's global production in February tumbled 49.6% from a year earlier to 434 179 vehicles, underlining a prolonged slump in the worldwide auto market. Its domestic output for the month nose-dived 56.4% year-on-year to 207 743 vehicles.

- AP