It appears even Toyota, the industry’s top-selling carmaker by volume, couldn't avoid the combined profit gouging effects of an economic downturn, rising material costs and a slowing global economy that have negatively affected most major carmakers. We’ve already seen GM post a $3.3 billion loss this quarter and a number of other carmakers including Daimler, BMW, Honda and Mazda all report double-digit profit slumps, and today Toyota has announced that its January-March quarter sank 28% on last year’s result.

Toyota’s profit for the quarter fell to ¥316.8 billion ($3.05 billion) from ¥440.1 billion a year ago - the first on-year decline in profit since the April-June quarter of 2005, reports Automotive News. Executives have blamed the strengthening yen and declining sales of SUVs and pickups in North America for the poor result, and have already responded by raising car prices.

For the fiscal year ended March 31, Toyota sold 8.91 million vehicles worldwide – 4.5% up on levels one year ago. Despite the poor market conditions, executives are expecting sales to rise this year by 1.6% to about 9.06 vehicles.

Things are expected to get worse, however, as Toyota is still forecasting a 27% profit slump for the year. "We are facing a severe business environment," Toyota President Katsuaki Watanabe warned reporters.