Bond rating agency Moody's Investors Service warned Wednesday it may downgrade Toyota Motor Corp.'s credit rating due to curtailed car production after the earthquake and tsunami which hit Japan on March 11.

The carmaker is running just two plants at limited capacity and had halted production at all 18 of its Japanese plants after the disaster disrupted the flow of parts.

Toyota said Wednesday it would resume limited production at its plant in Kanagawa, west of Tokyo, on Monday.

The Kanagawa factory will make the Corolla Axio and minivan Raum models. But Toyota spokeswoman Shiori Hashimoto said it remained unclear when Toyota would return to full production in Japan.

She said the March disasters resulted in a production loss of 260,000 cars from March 14 to April 8.

Moody's said Toyota's financial and operating performance will worsen as a result of the disasters, which are causing major disruptions in auto parts supplies and have forced Toyota and other automakers to halt production.

Shares fall

Shares in Toyota, the world's biggest automaker, have dropped nearly 10 per cent since the disaster.

Mamoru Kato, an analyst at Tokai-Tokyo Securities, said Toyota's production at the two plants accounts for only 3 to 4 per cent of normal capacity. The two factories have been making Prius and Lexus cars since March 28.

"There is no question that a plunge in domestic production will really hurt Toyota's earnings," said Kato.

"We don't know how long the shortage crisis will last." Moody's said it would take "many months" for Toyota to return to normal production. Toyota's Hashimoto declined to comment on Moody's warning.

Toyota's long-term uncollateralized debt rating is currently set at Aa2 by Moody's. The rating agency said its review for possible downgrade will focus on Toyota's ability to restore production in Japan.

"Moody's will also consider how quickly the company can improve its profitability despite the negative impact of the disasters," it said.

Toyota said Monday it is inevitable that it will be forced to suspend production at all of its North American factories due to parts shortages following the March 11 earthquake.

With files from The Associated Press