Isuzu Posts $344M Loss for Year

TOKYO AP reported that Isuzu Motors, a Japanese automaker controlled by General Motors Corp., reported a narrower loss for this past fiscal year than a year earlier and said it plans to return to profitability this year.

The Tokyo-based company on Friday posted a group net loss of 43 billion yen ($344 million) for the fiscal year that ended in March in contrast to a loss of 67 billion yen a year earlier.

Vehicle sales dropped both at home and the United States amid a global economic slowdown this past year. Cost reduction helped it post a smaller loss than a year earlier.

Although Isuzu sold 13 percent fewer vehicles than the previous fiscal year, revenues edged up 1.8 percent to 1.6 trillion yen ($13 billion) from 1.57 trillion yen as the truckmaker widened its profit margins.

Isuzu sold 308,437 vehicles in fiscal 2001, down from 355,093 vehicles a year ago. Vehicle sales in Japan fell 18 percent and 12 percent overseas.

Isuzu said it was moving forward with a turnaround plan in partnership with General Motors, which owns 48 percent of the Japanese company. Announced last year, the plan includes cutting costs, closing a plant, selling assets and creating a global strategy with GM.

Isuzu has so far eliminated 5,500 jobs, about 14 percent of its global work force. It employed 38,000 people before starting its recovery plan.

Isuzu is forecasting a profit of 3 billion yen ($24 million) on sales of 1.37 trillion yen ($11 billion) for the fiscal year ending in March 2003.

For the fiscal year just ended, Isuzu lost 9 billion yen ( $72 million) on the plunging value of its stockholdings and took a charge of 14 billion yen ($112 million) for a retirement plan.

A favorable currency rate helped ease the impact of those blows on its bottom line. A weaker yen means that the overseas earnings of exporters like Isuzu translate into more money when they are converted into the Japanese currency.

One bright spot in Isuzu's business was its engine sector, where the company posted a 40 percent improvement in revenue on surging production at its Poland plant and the joint venture engine plant with GM in the United States.