Toyota to cut domestic output amid slowing demand

TOKYO: Toyota Motor Corp. said it will suspend production of some vehicles in Japan for two days later this month to reduce output to grapple with slowing global demand.

Toyota will halt production of Lexus luxury models at the Tahara plant, in central Japan, and output of all vehicles at the Miyata plant, in southwestern Japan, on December 24 and 25, company spokesman Toshiaki Hori said Wednesday.

The Miyata plant, which makes Lexus cars, Kluger sports utility vehicles and Harrier hybrids, is run by subsidiary Toyota Motor Kyushu Inc, Hori said.

Japan's No 1 automaker is suspending production to deal with a global downturn in demand, he said, without elaborating.

On Tuesday, Toyota said its sales in the United States had tumbled 34 percent in November, including a 35 percent slump in its Lexus luxury line. Many of the Lexus models produced at the two plants are exported to the United States.

US sales fell sharply for nearly every Toyota model, and the decline came even as the company, which has typically shown restraint in incentive spending, extended its zero-percent financing offer on a dozen models through the end of December.

Toyota officials said they expect short-term sales to be down, but that the introduction of new models in the U.S. could boost sales in early 2009.

Last month, Toyota Motor Corp. revised its projected global production to 8.24 million vehicles for the year ending March 2009, down 5.7 per cent from an earlier projection of 8.74 million. Hori declined to detail the impact the latest suspension would have on global output.

Tough economic conditions and tight credit markets have cut into sales across the industry this year, forcing many automakers to cut production.

Hori said winter bonuses for Toyota's 8,700 managers would be cut by 10 percent, but declined to disclose the total amount of money saved.

The company also cut its net profit forecast through March to 550 billion yen ($5.9 billion), or about half of its earlier projection of 1.25 trillion yen ($13.4 billion).