Toyota cuts annual output target by 500,000 units due to chip shortage

Japan’s Toyota Motor Corp. has lowered its production target for the year ending March 31, 2022, to 8.5 million vehicles, because of the effects of the COVID-19 pandemic on production, the company said Feb. 14.

The company has cut its output projection twice; from the initial 9.3 million vehicles in August and 9 million units projected in September.

The latest revision comes as Toyota lowered its global March production by 100,000 vehicles to 950,000 vehicles “due to the impact of semiconductor shortages,” the company said.

From March 2 to March 22, the company plans to shut three domestic production lines at its Kyushu Miyata and Iwate plants, down from seven lines in six plants in February.

Lower vehicle production has reduced demand for automotive steel, resulting in local steelmakers cutting their yearly forecast.

Nippon Steel has cut its projected consolidated crude steel production for the financial year ending March 31, 2022, to 44.80 million mt, down 2% from the 45.7 million mt it had forecast on Nov. 2, 2021, the steelmaker said Feb. 3, citing a drop in steel demand from the automotive industry as one factor.

Another steelmaker JFE Steel lowered its annual output forecast by 500,000 mt to 26 million mt, but the outlook was still higher than the 24 million mt produced for fiscal year ended March 31, 2021.

“Steel demand is temporarily weakening due to the reduction in automobile production, resulted from the shortage of semiconductor [chips] and parts,” it said Feb. 8.

— Clement Choo