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Jessica Furtney Sc7n5 Xo W1o Unsplash 5e8222a94a3a6
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Jessica Furtney Sc7n5 Xo W1o Unsplash 5e8222a94a3a6

Toyota Announces 40% Worldwide Production Cut Due Next Month

Aug. 19, 2021
COVID-19 surges in Vietnam and Malaysia are throttling the automaker's supply chain.

Toyota Motor Corporation announced August 19 they would be cutting back vehicle production at plants in Japan as well as factories in Southeast Asia, China, North America, and Europe.

Japan’s Nikkei Daily reported the auto giant was facing issues worldwide with a lack of supplies—and not just semiconductors. COVID-19 is still raging in Southeast Asia, including in two countries—Vietnam and Malaysia—that are home to some of Toyota’s key suppliers.

Difficulty sourcing parts from those countries has already led the RAV4 manufacturer to cut Japanese production in July and April and is now contributing to the global production cuts slated for September. A Toyota spokesperson told Nikkei that COVID-19 surges in Southeast Asia were actually a bigger problem for Toyota right now than the semiconductor shortage that has hamstrung almost every global automotive manufacturer.

Previously, Toyota was aiming to build a little under 900,000 vehicles worldwide in September. The target has been reduced to about 500,000 vehicles, a 40% cut. According to Nikkei Daily, Toyota production in North America, China, and Europe will be scaled back by about 220,000 vehicles.

In June 2021, the most recent month with production results available, Toyota built 831,533 vehicles worldwide, 537,146 of which were built outside Japan.

The Japanese automaker behind the Prius hybrid has otherwise had a solid year. On August 4, the automaker reported a record $8.2 billion profit for the first quarter of 2021, and it later said that sales for the first half of 2021 were up by 4.5% compared to the same period in 2019 thanks to sales in North America and China.

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