Following Toyota’s official announcement back in August that it was reducing its global sales target for 2009 by 700,000 vehicles comes a new report that claims the industry juggernaut has cut its annual earnings forecast to less than a third of what it was the previous fiscal year.

The new predictions have Toyota posting a global decline in profit of 73.6%. For the April-June quarter, Toyota reported a 39% drop in operating profit compared to the same period last year, and for the total year ending March 2009 the company cut its net profit forecast to ¥550 billion ($5.5 billion), or about half of its earlier projection of ¥1.25 trillion ($12.6 billion), and about a third of the previous year’s profit of ¥1.72 trillion yen, reports the Detroit Free Press.

Toyota has previously cited America’s credit crunch, a strong yen, rising oil prices and rising material costs as the main reasons for its recent poor performance, but recent reports have claimed that sales growth in emerging markets has also been slower than expected. Toyota's North American operations have now reported a $335 million operating loss for the April-September fiscal half-year as sales dropped 9.6%.

“The financial crisis is negatively impacting the real economy worldwide, and the automotive markets, especially in developed countries, are contracting rapidly,” said Toyota executive vice president Mitsuo Kinoshita. “This is an unprecedented situation.”

Despite the declines in sales for established markets, Toyota is still optimistic about markets such as China, India, Russia and Brazil at fueling its future growth. The carmaker also plans to start building more small cars and hybrids in North America to capitalize on growing demand for such vehicles. It also plans to cut costs and adjust production amid “a variety of risks and uncertainties, including higher energy and raw material prices.”