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Toyota cutting costs to withstand financial crisis, sales drop

Business Materials 16 December 2008 10:20 (UTC +04:00)

Japan's largest automaker, Toyota Motor Corp, is implementing a series of cost-cutting measures to weather the global financial crisis and its resulting fall in car sales, reported dpa.

Toyota has put a project to develop a diesel motor with Isuzu Motors Ltd on ice, Japanese media reported Tuesday, citing informed sources.

The engine was to be used in small cars for the European market.

Toyota also plans to move back the opening of a new factory in the southern US state of Mississippi by at least a year. It originally had planned a 2010 opening for the plant slated to produce the hybrid Prius car.

Toyota has also asked steelmakers to lower the price of steel plates by about 30 per cent in the new fiscal year, which begins April 1, said the respected Nikkei financial newspaper.

The price agreed to by the industries' two largest companies, Toyota and Nippon Steel Corp, is seen as a standard, and negotiations are to start at the beginning of the year.

The cost cuts were reported after Japanese media said last week that Toyota would have to further lower its earnings projections for the current fiscal year as it was expected to suffer an operating loss in the year's second half because of declining sales and the yen's continued strengthening against the dollar.

Toyota lowered its earnings projections for the year in November but had still forecast an operating profit.

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