Toyota expects operating profit this business year to fall 35 per cent to 300 billion yen (€2.6 billion) after Japan’s biggest earthquake on record severely disrupted car production and cut sales.

Operating profit in the year to March 2011 was 468.3 billion yen.

The 9.0 magnitude earthquake that rocked northeastern Japan on March 11th forced Toyota and other Japanese automakers to cut output at home and abroad as they struggled to secure vital parts. The ensuing nuclear disaster and power shortages have compounded problems.

The world’s biggest automaker said on May 11th that the earthquake had contributed to a 52 per cent fall in profit during the January-March quarter, but the firm delayed unveiling the annual forecasts as it weighed the impact of the disaster on consumption and its supply chain.

The disruption to output will likely mean Toyota will fall behind General Motors and Volkswagen to rank third in global vehicle sales this year. – (Reuters)