Toyota is to review its entire range of models as the company's new president attempts to revive the world's biggest car manufacturer.
The new president, Akio Toyoda, is the grandson of Toyota's founder and has already predicted the next two years will be difficult times for the manufacturer.
As well as reporting its biggest-ever annual loss for 2008, Toyota has already predicted that its fortunes will fall even further during this year.
The company made a net loss of 437 billion yen (2.8 billion) for the year to March 31, the first loss since 1963. It has predicted a loss of nearly double that figure for the 2009 year.
Mr Toyoda said: 'We want to do everything possible to avoid a third consecutive year of losses.'
The company will try to revive its fortunes in the European market by concentrating on petrol-electric hybrid vehicles. It has just launched the latest version of the Prius hybrid in Japan, which has already attracted 180,000 orders.