Toyota projects 150,000 vehicle loss in April on parts shortage

Japan's Toyota Motor Corp expects to start its fiscal year 2022-23 (April-March), with a vehicle shortfall of 150,000 units globally in April, the company said March 17, citing a shortage of semiconductor chips and the effects of the coronavirus pandemic.

As a result, Toyota plans to intermittently shut seven domestic production lines in five plants, out of its overall 28 lines in 14 plants, starting from April 1 until April 23.

The stoppages in April are a sharp jump from one production line in one plant for March, which caused Toyota to lower its global March production forecast by 100,000 vehicles to 950,000 vehicles.

"...our global production plan for April including overseas production is approximately 750,000 units (250,000 units in Japan and 500,000 units overseas)," Toyota said. In April 2021, it produced 895,678 units worldwide, so the April 2022 projection represents a 16.3% fall.

"In addition to the shortage of semiconductors, the spread of COVID-19 and other factors are making it difficult to look several months ahead, and there is a possibility that the production plan may be lower," it said, projecting that its global production plan from April through June will average about 800,000 units.

"Under these circumstances and in light of a review of past developments, we have revised production plans to be more reasonable in line with recent realities. Specifically, we have positioned the three-month period from April to June as an "intentional pause," and we will create plans based on the personnel structures and facility capacities of suppliers."

The three-month average will be lower when compared to the corresponding period in 2021. Toyota's data showed that from April 2021 to June 2021, it produced about 2.64 million units globally, averaging close to 880,000 units.

Toyota's lower projection for April to June is likely to result in lower demand for automotive steel in the quarter. Japan's Ministry of Economy, Trade and Industry had cautioned that the automotive sector could face a reaggravation in supply chains, specifically semiconductor chips and automotive parts, which could then see a need to revise production forecasts.