Toyota Motor Corp has said it will lower global production by 40% from its prior forecast for September, becoming the final major carmaker to do so as a result of a global chip shortage, but it will meet its yearly sales and production targets.
On Thursday, the world’s largest carmaker by volume reaffirmed its global production goal of 9.3 million vehicles for the fiscal year ending in March, as well as its plan to sell 8.7 million cars during that time.
“The 9.3 million global production plan takes into account certain risks,” executive Kazunari Kumakura told reporters. “We want to achieve the numbers.”
Toyota said the September cuts would affect 14 factories in Japan as well as abroad sites, and that the company expected to lower global production by about 360,000 vehicles that month.
Of these, 140,000 will be at Japanese plants, with the rest in the United States, China, Europe and other Asian countries.
Due to the months-long chip shortage, carmakers around the world have been reducing production, but a resurgence in Covid-19 cases in Japan, the Philippines, Thailand, Vietnam, and Malaysia – all of which have auto factories and chip plants – has prompted stricter restrictions, exacerbating the crisis.
Volkswagen stated on Thursday that it may need to reduce output even further, and that chip supply in the third quarter will be “extremely variable and tight.”
Toyota shares closed down 4.4% in their biggest daily drop since December 2018, pulling the benchmark Nikkei average to a seven-month low.
The carmaker had already halted assembly lines at some Japanese factories between late July and early August, including its Tahara plant, due to a surge in infections in Vietnam which had constrained the supply of parts, the Nikkei reported earlier.
Toyota also halted operations at three factories in Thailand last month owing to a pandemic-related component shortage.