TOKYO -- Japanese supplier Denso Corp., the worlds second-biggest auto parts maker, is forecasting a second straight year of losses as the global market meltdown hammers North American sales to Toyota Motor Corp. and the Detroit 3.
Denso is predicting an operating loss of ¥40.0 billion, or $411.1 million at March 31, 2009, exchange rates, in the fiscal year that began April 1. The company made the forecast April 28 as part of the release of its financial results.
It is predicting a net loss of $195.3 million for the year.
Denso slumped to a $383.5 million operating loss and an $864.3 million net loss in the fiscal year that ended March 31.
The results marked an about-face from the year before, when Denso posted operating profits of $3.58 billion and net income of $2.51 billion on booming business with Toyota, its biggest shareholder and top customer.
But now, Toyota, which owns 23 percent of the supplier, is expecting its first annual operating loss in decades as sales implode. To match tumbling demand for cars and trucks, the worlds biggest automaker has been slashing output at home and abroad.
Densos sales have contracted in tandem.
Revenue fell 21.9 percent to $32.30 billion last year, from $41.37 billion the year before. Denso sees revenue further deteriorating to $27.96 billion in the current fiscal year, which ends March 31, 2010.
Last year, Denso booked big declines in operating profits and sales in all regions. But Japan was the only market to notch an operating loss, of $1.18 billion.
Revenue from the Americas tumbled by a third to $5.76 billion, and operating profit there dropped 87.8 percent to $52.2 million. Denso attributed the collapse to declining business with Toyota and the three American automakers.
Denso ranks No. 2 on the Automotive News list of the top 100 global original-equipment automotive parts suppliers based on 2007 sales.