December 14, 2008

Toyota may cut executive bonuses

Toyota executives may get substantially smaller bonuses this fiscal year -- and possibly none at all -- because of harsh economic reality, sources said Sunday.

Citing informed sources, Kyodo reported that Toyota Motor Corp., Japan's biggest automaker, is considering cutting executives' salaries.

The cost-cutting actions will be taken up at a shareholders' meeting next June, the sources told the Japanese news agency. The moves come as Toyota is likely to revise further downward its group earnings projections for the current fiscal year ending March.

In fiscal 2007, Toyota paid a total about $11 million in bonuses to about 29 board members and a total of about $708,000 to seven auditors. In addition to the bonuses, the automaker paid a total of about $31.3 million in executives' salaries in fiscal 2007.

With sharp declines in global auto sales and the yen's sharp appreciation against the U.S. dollar and the euro, Toyota is expected to report an operating loss of about $1.1 billion in the October-March period.