Mazda Motor Corporation now expects to post a group net loss of JPY13bn instead of a previously projected JPY50bn profit for the financial year ending 31 March as the decline in global vehicle sales and the yen’s appreciation have been faster than predicted earlier, it said on Wednesday.

The automaker now expects to record a consolidated operating loss of JPY25bn, instead of a previously forecast JPY90bn profit, on sales of 2.55 trillion yen, down from 3 trillion yen forecast earlier, Kyodo News said.

Mazda also revised down its vehicle sales projection for fiscal 2008 from 1.41m units forecast last October to 1.24m units, down 9% year on year. It expects to post falls in all markets except China.

The automaker has cancelled plans to pay a year-end dividend of JPY3 a share, saying the dividend amount remains undecided.

For the first three quarters of fiscal 2008, Mazda reported group net profit down 35.9% to JPY28.86bn  on sales off 16.7% to 2.09 trillion yen.

Global vehicle sales declined 1.0% to 964,000 units due to a sharp sales decline starting in the October-December quarter.

Mazda will not renew 500 temporary worker contracts due to expire in March, chief executive Takashi Yamanouchi told Reuters.

The job cuts would be on top of the 1,500 the company has announced since November.

Mazda last year posted a record net profit of JPY 91.84bn yen as its cars, particularly the 3, sold well in North America and Europe.