Toyota slashes annual production target due to parts and chips shortages

Toyota Motor Corp (7203) said last week that it had revised down its annual production target by 300,000 vehicles due to coronavirus-related output slowdown at parts facilities in Vietnam and Malaysia as well as because of a global shortage of auto chips.

The largest auto maker worldwide now projects to manufacture 9 million vehicles during the year to March 31st, down from 9.3 million vehicles in the previous forecast.

“It’s a combination of the coronavirus and semiconductors, but at the moment it is the coronavirus that is having the overwhelming impact,” Kazunari Kumakura, an executive at Toyota, was quoted as saying by Reuters.

Earlier in September, the Japanese company reduced global production by 360,000 vehicles. Last Friday it also said that global output would be cut by additional 70,000 vehicles this month and by another 330,000 vehicles in October.

The shares of Toyota Motor Corp closed lower for the fourth time in the past ten trading sessions in Tokyo on Monday. It has also been the steepest single-session loss since August 20th. The stock went down 1.65% (JPY 164.0) to JPY 9,795.0, after touching an intraday low at JPY 9,661.0. The latter has been a price level not seen since September 3rd (JPY 9,635.0).