INSTANT VIEW 5: Toyota cuts outlook on global sales slump

TOKYO (Reuters) - Toyota Motor Corp slashed its annual profit forecasts on Monday, its second profit warning in less than seven weeks, due to a relentless global slide in car sales and a crippling rise in the yen.

The world's biggest automaker cut its group operating forecast to a loss of 150 billion yen ($1.7 billion) for the year to March 31, after shocking financial markets last month by slashing its group operating profit forecast by 1 trillion yen to 600 billion yen.

COMMENTARY:

KOICHI OGAWA, CHIEF PORTFOLIO MANAGER, DAIWA SB INVESTMENTS

"This is very, very, very bad ... There's a chance that they could fall into the red in the next business year as well. This is also not just a problem for Toyota. What is good for Toyota is good for the Japanese economy."

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FUJIO ANDO, SENIOR MANAGING DIRECTOR, CHIBAGIN ASSET MANAGEMENT

"This shows how rapidly and badly the auto sector has deteriorated. We should also look closely how auto-parts makers like Denso Corp will do businesses in an increasingly severe business environment like this.

"Toyota will likely revise down its earnings numbers or sales forecast again in late January or February as I don't think the business environment will become any better."

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KOJI ENDO, AUTO ANALYST AT CREDIT SUISSE SECURITIES

"Toyota is likely to post losses next business year too as its earnings are likely to only get worse (if current auto market conditions continue).

There is even a possibility that Toyota might have to cut this year's outlook again given uncertainties including the currency market. And the other concern is that the company might cut its dividends."

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SHOTARO NOGUCHI, ANALYST AT MITSUBISHI UFJ SECURITIES

"Conditions next fiscal year could be more severe, given the yen's strength and worsening market conditions, unless the company and the government copes flexibly with external factors.

"The fact that Toyota did not make volume projections for 2009 at today's announcement, despite its tradition of forecasting sales volume for the next calendar year at a year-end news conference, highlights the uncertainty surrounding the company."

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MITSUSHIGE AKINO, CHIEF FUND MANAGER, ICHIYOSHI INVESTMENT

"Today's announcement is within our expectations. The full-year loss forecast is based on the current situation in North America and we could already expect this.

"The negative risk for Toyota is the currency. Toyota now looks for the dollar to trade at 93 yen but the yen may get stronger and could trade somewhere around 85 yen to the dollar."

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JUNICHI MISAWA, EXECUTIVE OFFICER AT STB ASSET MANAGEMENT

"(Given media reports of losses), the revised outlook was roughly in line with expectations and there was not much surprise. But it underscores the severity of the current environment."

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MARKET ACTION:

Toyota shares closed down 0.2 percent at 2,895 yen ahead of the official announcement, but shortly after the Nikkei business daily said the automaker was set to slash its annual outlook to a consolidated operating loss of 150 billion yen -- its first such loss ever. The Nikkei average rose 1.6 percent.

(Reporting by Tokyo Newsroom)