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Toyota's Operating Profit May Fall by Quarter

Toyota Motor's 2008/09 operating profit is likely to fall by around a quarter, underscoring tough business conditions for Japanese manufacturers, the Nikkei business daily said on Thursday.

AP

The drop was expected to come from an economic slowdown in the United States, the company's biggest market, as well as recent sharp gains in the yen, the paper added.

Despite the report, shares in Toyota , Japan's top automaker, climbed more than 3 percent on Thursday.

The paper said Toyota's operating profit would likely be around 1.7-1.8 trillion yen ($16.7-17.7 billion) in the business year to March 2009, down 22-26 percent from the company's forecast of a 2.3 trillion yen profit for the just-ended year.

It also lags a consensus profit projection of 2.1 trillion yen for 2008/09 in a poll of 22 analysts by Reuters Estimates.

Toyota spokesman Paul Nolasco declined comment on the report.

Slowing demand in the United States also hit Toyota's truck unit Hino Motors. The Nikkei paper said Hino would stop producing commercial vehicles at its plant in California. That would be the first such move by a Japanese automaker in the United States.

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