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Toyota Expects Production Target Miss as Chip Shortage Drags On

Toyota believes it will not be able to achieve its annual 9-million vehicle production target as it doesn’t have enough computer chips to reach that goal


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Toyota president Akio Toyoda gestures at a briefing on electric vehicle battery strategies in December 2021. Photo: AFP.

 

Toyota said on Tuesday it expects to miss its annual 9 million vehicle production target because competition for semiconductors meant it didn’t have enough to ramp up car output to offset production lost during the pandemic last year.

“Hitting the 9 million mark is going to be extremely difficult,” Kazunari Kamakura, an executive at the world’s biggest car maker, said during an online briefing. Toyota, he added, could not predict how long the chip shortage would last.

Toyota and other automakers have been forced to curb production even as demand in key markets such as China has rebounded. In addition to tackling chip shortages caused by Covid-19 supply-chain disruptions, car makers also have had to contend with soaring semiconductor demand at consumer electronic companies.

The surge in Omicron infections did not factor into the latest production outlook, but it is, nonetheless, a concern forToyota, Kamakura said. Toyota‘s business year runs from April to March.

Covid-19 lockdown restrictions last year disrupted supplies of components from plants in Southeast Asia.

The maker of the Corolla compact sedan said it will build 700,000 cars globally in February, more than last year, but 150,000 fewer than it had initially planned.

To reach its annual 9 million production target, set in September, Toyota would have to build 1 million vehicles in March.

 

• Reuters with additional editing by Jim Pollard

 

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Toyota Halts Production Over Supply Chain Squeeze

 

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Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years and has a family in Bangkok.

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