Toyota to cut full-year production target on chip shortage

TOKYO — Toyota is finally cutting its fiscal-year production forecast, after clinging to it for months, conceding it must trim its plan for November due to the semiconductor crunch.

In abandoning its target, the automaker said it “expects” to lower its worldwide production schedule for the fiscal year ending March 31, though it did not offer a new target.

Toyota had stubbornly clung to its goal of churning out 9.7 million vehicles in the current fiscal year, even as it repeatedly cut monthly plans amid global supply chain upheaval.

A spokesperson said Toyota is evaluating a new target. The company is expected to report fiscal second-quarter earnings early next month, and new guidance could come then.

As recently as September, Toyota had said it wanted to manufacture 900,000 vehicle a month from September through November, as it raced to recoup lost volume from earlier in the year. But it later cut September output to 850,000 and October’s output to 800,000.

In a statement issued Oct. 21, the automaker said November total would also be lowered to 800,000, covering 250,000 units in Japan and 550,000 overseas.

Suspensions in Japan will affect 11 lines in eight plants, out of 28 lines in 14 plants.

Affected nameplates include the Corolla, Corolla Cross, RAV4, Camry, Crown, Land Cruiser Prado and 4Runner, as well as the Lexus LS, IS RC, NX, UX, ES and GX.

“As a result of this plan, the full-year production forecast for FY2023 is expected to be lower than the previous forecast of 9.7 million units,” Toyota said.

Despite continuing production problems, Toyota’s now-abandoned goal of 9.7 million vehicles for the full fiscal year would have chalked an all-time high if actually achieved.

The target counts output for only the Toyota and Lexus brands; it doesn’t cover consolidated figures for the Daihatsu minicar or Hino truckmaking subsidiaries.

The objective represented a big leap forward from Toyota’s current production record of 9.08 million vehicles, the volume it pumped out in the fiscal year ended March 31, 2017.

Production rose 4.7 percent to 8.57 million vehicles in the fiscal year ended March 31, 2022.

Toyota kicked off the current fiscal year cautiously aiming higher on the hope that the global pandemic and worldwide supply chain troubles would settle down and fuel an upswing.

Instead, it soon said would take the foot off the gas because of pinched supply chains.

Still, Toyota has been trying to jump-start production and move ahead of last year. In the first eight months of 2022, Toyota’s global consolidated output, including the Daihatsu minicar and Hino truck subsidiaries, was down just 0.1 percent from the year before to 6.82 million vehicles.

Production of just Toyota and Lexus vehicles was up 0.2 percent to 5.83 million, meaning the company was off pace from its 9.7-million target.

In August, the latest month for which figures are available, Toyota’s global consolidated output climbed 40 percent to 885,812 vehicles, riding a 61 percent surge in overseas production. The actual result beat Toyota’s downwardly revised guidance, but still couldn’t hit the initial target.