That screeching noise is Japan's big three carmakers slamming on the brakes. Toyota, the biggest, slashed global production by 17 per cent last month. Nissan and Honda made about 5 per cent fewer vehicles in August. Given the climate, it is no wonder carmakers are cutting back. Tight credit markets, dented consumer confidence and high gas prices all conspire to reduce demand.

The US, which contributes the bulk of Japanese carmakers' profit, is obviously the worst hit. But the more recent surge in emerging markets is also looking fragile. China, forecast to overtake the US as the biggest car market by 2015, registered a rare drop in sales last month. Investors are bailing out: Toyota's share price has lost 22 per cent year-to-date, in line with the broader market, while Nissan is down 38 per cent.