Toyota Japan output to drop 60 percent in April: report

Business Materials 24 January 2009 11:16 (UTC +04:00)

Toyota Motor Corp (7203.T) plans to reduce vehicle production in Japan by nearly 60 percent in April, a level that could force it to cut its domestic workforce amid slumping car sales, Tokyo Shimbun newspaper reported on Saturday.

Toyota, the world's biggest automaker, is whittling down its non-permanent workforce by letting contracts expire, but executives have said they intend to leave full-time staff untouched despite unprecedented factory suspensions in Japan, reported Reuters.

Toyota has announced plans to close all its domestic factories for a combined 14 days between January and March, reducing work to a single shift at 17 assembly lines, out of 75 globally, at different times from January and February.

The Japanese daily, without citing sources, said Toyota would need to cut its domestic production in April to between 145,000 and 148,000 units on the assumption car sales would not turn up just yet.

A Toyota spokesman said production plans for April had not been decided. Suppliers are usually given final production plans about one month in advance.

If the planned level for April were to last for a year, annual production would reach around 1.8 million vehicles -- far short of the 3 million units that Toyota considers a minimum necessary to retain its permanent workforce, the paper said.

A company source told Reuters a day earlier that Toyota was considering cutting full-time employees in Britain in North America in a rare move as it faces its first-ever consolidated operating loss in the business year to March 31.

Automakers everywhere are aggressively cutting production, closing factories temporarily and reducing wages to weather plunging vehicle sales amid the global economic crisis.