Toyota, the world's top carmaker, said its losses were ballooning as world car sales slid while truckmaker Volvo swung to a fourth quarter loss and Italy readied aid for the ailing industry.

A sudden collapse in consumer demand last year battered automakers who were forced to cut production and shed jobs leaving the sector and its related industries reeling.

Governments have swung into action, preparing aid packages to help out their struggling car sectors.

In Italy on Friday, the government approved a decree which included incentives worth more than 1,500 euros for trading in cars that were more than 10 years old and buying a new one.

Toyota Motor Corp operating loss for the year to end-March would be 450 billion yen ($4.95 billion), three times the loss it had forecast just six weeks ago.

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