Toyota, BMW spread gloom

The Paris motor show today was full of shiny new cars and razzamatazz but all the talk was of dismal times for the industry.

Toyota's shares tumbled to a three-year low in Asia this morning after it announced an unprecedented wave of interest-free loans to entice US consumers to its showrooms.

It is the first time the company, the world's second-biggest motor vehicle firm, has used free financing across so many models.

The strategy was seen as high risk and gave a worrying insight into how tough conditions are in the US, where car sales plummeted 32% in September.

That came after BMW, maker of Rolls-Royce and Minis, warned of a global slump in the industry for at least nine months.

Meanwhile, Lotus accelerated into profit in 2007 although turnover crashed 17%.

Norfolk-based Lotus Group International, owned by Malaysia's Proton, turned a £2 million net profit in 2007 after a £4.9 million after-tax loss the previous year.