Toyota Slims Production At 5 Plants Over Parts Shortage As COVID Hampers Suppliers

Toyota (TM) announced on Thursday that it would be cutting production at five of its plants in Japan as the COVID pandemic continues to affect its parts supplies.

The automaker said that would reduce its global production plans for April to about 750,000 units, with 250,000 vehicles produced in Japan and 500,000 vehicles produced overseas.

Toyota said the cut is about 150,000 fewer vehicles than initially planned.

Globally, the company said it is expecting to produce about 800,000 units from April to June.

The parts shortage includes semiconductor chips, which is affecting every automaker in the industry.

“Up until now, we have conducted recovery production with tremendous efforts from the various relevant parties with the aim of delivering to customers as many vehicles as possible at the earliest possible date,” Toyota said in a statement about the production cutback. “However, due to the parts shortage, we have had to make repeated last-minute adjustments to production plans, and this has imposed considerable burdens on production sites, including those of suppliers.”

The company continued, “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.”

Toyota said the shutdowns would occur over three months from April to June, affecting seven production lines at five plants in Japan that produce vehicles such as Toyota’s Corolla Sport, Camry, Yaris, Yaris Cross, Noah, Voxy, C-HR, and Aqua models, among others.

The affected Toyota plants include the Tsutsumi Plant, Tahara Plant, Kyushu Miyata Plant, East Japan Iwate Plant, and Auto Body Fujimatsu Plant.

Toyota said the production cuts were an “intentional pause” that it hoped would help create “healthy workplace environments that place the highest priority on safety and quality, rather than exceeding the capacities of facilities, pushing people to their limits, and making do through overtime work.”

Toyota also said there was a possibility that global vehicle production could go lower, and it would review the situation with its parts suppliers in the near term.

The company apologized to customers who have been waiting for a new vehicle to arrive, saying that it hopes to “deliver vehicles with high quality as many as possible.”

As of Thursday at 1:31 p.m. ET, shares of Toyota were trading at $170.82, down $1.07, or 0.63%.