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Shaky economy sends Toyota down by 46%

Wednesday 09 February 1994 00:02 GMT
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TOKYO (AP) - Toyota, Japan's largest car maker, saw profits tumbled 46 per cent in the six months to December as the weak Japanese economy and strong yen cut into earnings.

Net profits of the parent company fell to Y39.44bn ( pounds 248m) from Y72.34bn a year earlier. The company said earnings were likely to continue to decline until the end of its fiscal year in June because of weak demand.

Masami Iwasaki, vice-chairman of the board, said uncertainty over currency exchange rates and the bleak outlook for the European car market were casting clouds over Toyota's profit prospects for the full year. 'The overall situation will be very difficult,' he said.

The dismal six-month profits were reflected in the company's capital spending plans. Toyota said it had decided to cut its capital investment by 15 per cent to Y240bn. The company had hoped to maintain its capital spending at about the same level as the previous fiscal year.

Toyota, which holds more than 40 per cent of the Japanese market, said parent company sales dipped 13 per cent during the six-month period to Y3,990bn.

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