INSTANT VIEW: Toyota sees bigger losses as sales slide

TOKYO (Reuters) - Toyota Motor Corp said it expected its full-year loss would be three times what it flagged just six weeks ago, as the world's biggest automaker struggles to cut production fast enough to match sliding sales.

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KEY POINTS

-- Toyota now expects an operating loss of 450 billion yen ($4.95 billion) for the year to March 31 instead of the 150 billion yen loss it forecast in late December.

-- For October-December, it reported an operating loss of 360.5 billion yen ($4 billion) against a year-earlier profit of 601.6 billion yen.

-- It cut its forecast for 2008/09 global vehicle sales to 7.32 million units from 7.54 million.

-- Toyota shares closed up 1.6 percent at 3,090 yen ahead of the results announcement.

COMMENTARY

KOCHI OGAWA, CHIEF PORTFOLIO MANAGER, DAIWA SB INVESTMENTS

"Production adjustments are likely to continue into the first half of next fiscal year, so I think things will be tough for some time to come. The question is how much (Toyota) can cut costs going forward."

HITOSHI YAMAMOTO, CEO, FORTIS ASSET MANAGEMENT JAPAN

"The earnings forecast was very severe, but the figures were almost in line with expectations and are unlikely to have a big impact on its future stock price.

"I was slightly concerned about the impact of Moody's downgrading Toyota's long-term rating to Aa1 on its stock, but so far the effect seems to be small.

"The new rating of Aa1 is higher than U.S. and European rival car makers' and that is a relief to investors.

"If the U.S. government can take effective measures to shore up the auto loan market, there will be a swift recovery in auto demand. I think that's the key for future recovery."

SOICHI OKUDA, CHIEF ECONOMIST, SUMITOMO SHOJI RESEARCH INSTITUTE

"Toyota's results raise concerns about the damage to Japan's regional economies, which have relied heavily on the company's local outlet operations. The yen's strength has hit Toyota hard, and while the damage from that likely peaked in the October-December quarter, the effect will likely remain for the January-March quarter.

"There are also lingering pressures for downward revisions to earnings in the first half of next business year as the impact continues to be felt from sagging exports due to slackening global demand."

YOSHINORI NAGANO, CHIEF STRATEGIST AT DAIWA ASSET MANAGEMENT, TOKYO

"This is absolutely awful. The earnings situation has obviously deteriorated since last October when the company's stock price plunged.

"But hopes for the U.S. economic steps and their effectiveness have supported the company's stock since then. and that will likely continue even after the earnings.

"Still, if something goes wrong on that (economic steps) front, that could batter the stock price once again.

"The key now is whether consumers in America will be able to start securing loans again. Slumping sales due to the dismal state of the economy may be inevitable, but another big problem facing the sector today is that consumers who can normally get loans can't get them these days."

(Reporting by Tokyo Newsroom)