If Toyota's Hurting, You Know It's A Bad Year For Auto Sales

Implications: Toyota Motor Corp. sees North American sales coming in at 2.70 million units in 2008 and languishing at the same level in 2009. By contrast, the Toyota group sold 2.83 million units in North America last year.

Analysis: Toyota Motor Corp, the world's second largest carmaker, lowered its forecast for 2009 auto sales growth to 2.1% from 5.6% as record fuel prices and sagging economies damp global demand.

The more modest ambitions highlight how even the worlds second biggest and most profitable carmaker has been stung by the U.S. meltdown. The carmaker's strong operating profits in North America nearly vanished in the April-June quarter, plunging 98.9%.

The company will reduce production in the UK and Poland, in response to a downturn in Europe, adding to cuts in the U.S. Toyota lowered the target for North America, its biggest market by 10% as drivers buy fewer SUVs and pickup trucks because of a slumping economy and high gasoline prices.

Toyota initially floated the 10.4 million sales target last year, before the subprime loan problem torpedoed demand in their biggest market. Hitting the goal would have made Toyota the first carmaker to pass 10 million units.

In Europe, Toyota is dropping one of two shifts at its Burmaston, England plant for five months, starting in the second half of September. The company also will suspend one of two shifts at an engine plant in Poland.

European sales are expected to fall 3.8% this year to 1.25 million units.