Toyota Motor Corp said that it would decrease its worldwide production target for April to 750,000 vehicles, down 150,000 from a prior estimate, as a semiconductor shortage and the Covid-19 outbreak wreaked havoc on company preparations. The revelation comes only a week after Toyota said that it would reduce domestic output by up to 20% in April, May, and June to relieve pressure on suppliers dealing with chip and other part shortages. The article is about Toyota Targets 17% Cut In global production.
“It is still difficult to foresee the situation several months ahead, and there is a possibility the current plan will be revised downward,” the company said in a statement. Toyota noted that the average monthly global production for April to June would be about 800,000 units.
According to Toyota CEO Kazunari Kumakura, worldwide car production would be down 10% in May and 5% in June compared to earlier predictions. Because of the shortages, the manufacturer has had to adjust its production schedule many times, aggravating suppliers and causing President Akio Toyoda to refer to the period from April to June as a “deliberate cooling off” period.
Aside from the continuous chip scarcity, Toyota is confronted with many issues. Covid-19 was compelled to halt a joint venture with China’s FAW Group in Changchun, in the northeastern city. The manufacturer also claimed logistical challenges as a reason for the stoppage of production at a factory in Russia, citing political uncertainty generated by Russia’s invasion of Ukraine, which it refers to as a “special operation.”
These considerations were not considered in Toyota’s April-June worldwide production plan, Mr. Kumakura said, adding that while the Ukraine situation had not yet had a direct impact on the company, it will investigate short- and long-term risks.
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