Toyota has announced it will further reduce production at its North American plants.

Toyota, the world’s biggest car manufacturer, has announced it will further reduce production at its North American plants.

After predicting its first annual net loss this year since 1950, Toyota had previously frozen North American hiring, eliminated overtime, suspended capital spending and scheduled periodic cuts in production.

It is now introducing a number of new measures to reduce costs. Executives could now see their take-home pay fall by 30%, including a 5% pay reduction and the elimination of bonuses. It will shut down production for between two and eight days in April at some US plants, with some also seeing a shorter work week.

Finally, it will offer buyouts – voluntary redundancy for part-time workers – to 18,000 individuals, but expects few workers to take the offer up given the worsening job situation in the US. The offer consists of 10 weeks pay, plus two weeks of pay for every year of service, plus $20,000 (£13,900).

The buyouts would not be offered to workers at two unionised plants in California and Mexico.

Jim Wiseman, Vice President of External Affairs for Toyota Motor Engineering & Manufacturing North America (TEMA), said: “We’ve taken responsible, step-by-step actions to address this issue in recent months, and we hope the new measures will help us adjust while protecting jobs.

“This philosophy of shared sacrifice is the best approach for us, and hopefully will make us a stronger company in the long term.”

Many car companies are cutting back as a global slowdown reduces demands. Nissan Motor Company this week said it would cut 20,000 jobs worldwide, or 8.5% of its 235,000-strong global work force, by March 2010, and both GM and Chrysler are offering incentives to hourly workers to retire or leave the payroll.