TOKYO—
Toyota
TM -0.02%
Motor Corp. plans to shut down most of its plants in Japan for several days next week, blaming a parts shortage caused by the magnitude 7.4 earthquake that hit eastern Japan on Wednesday.
Toyota said Friday that some of its suppliers were affected by the quake and unable to deliver enough parts. Toyota didn’t name the company, but
Renesas Electronics Corp.
, a major microchip manufacturer, said separately
that its plants in the area of the quake wouldn’t be back to full production until Wednesday next week.
This latest hiccup in Toyota’s supply chain highlights the difficult and uncharted territory car companies find themselves in as such disruptions continue to dent their outlooks and delay a full recovery in factory output.
Shortages caused by Covid-19-related factory shutdowns were exacerbated by a logjam in the shipping industry and various disasters.
Chief Executive
Herbert Diess
said Tuesday that the war in Ukraine threatened to upturn the company’s projections for this year.
Meanwhile, the scarcity of cars as a result of the industrywide supply-chain crisis is helping to drive up prices. Friday’s announcement could deepen the problem because it hits production of some of Toyota’s most popular models, including the RAV4 sport-utility vehicle.
Toyota was among the best-prepared car makers to deal with pandemic-related parts shortages.
Photo:
Masanori Inagaki/The Yomiuri Shimbun/Reuters
Toyota was among the best prepared car makers to deal with the pandemic-related parts shortages, remaining largely unaffected for months. That helped the Japanese auto maker top rival
General Motors Co.
in U.S. sales last year for the first time ever.
Toyota executives have attributed their ability to keep making cars to their foresight and their stockpiling of hard-to-source semiconductors.
Even as other car makers began to warn of a worsening parts shortage, Toyota stuck to its annual production target of 9 million vehicles. That changed suddenly in January when the company announced six production cuts in a single month.
In an industry that prides itself on predictability, automotive giants like Toyota say they no longer are sure what lies ahead for them month to month.
Toyota had already disclosed production cutbacks for March earlier this week, blaming the global supply crunch, before the earthquake made matters worse. Between those previously announced shutdowns and Friday’s announcement, Toyota expects to produce 50,000 fewer cars than planned this month.
Toyota also disclosed it was cutting production plans by 150,000 units for the month of April, saying that suppliers were struggling to keep up. The Japanese car maker said that further cuts were likely in May and June but that it couldn’t be sure how big they would be.
Toyota said it is trying to revise production plans to better fit current market realities, adding that the scramble to hit earlier targets was overwhelming its plant workers and suppliers. Now, the company said it would institute an “intentional pause” on its production targets, instead adjusting them in line with worker availability and the supply of parts.
Write to Sean McLain at [email protected]
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
Appeared in the March 19, 2022, print edition as ‘Toyota Shuts Most Japan Plants After Temblor Disrupts Supplies.’
For all the latest Business News Click Here
For the latest news and updates, follow us on Google News.
Denial of responsibility! NewsBit.us is an automatic aggregator around the global media. All the content are available free on Internet. We have just arranged it in one platform for educational purpose only. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials on our website, please contact us by email – [email protected]. The content will be deleted within 24 hours.
