Toyota reconsidering production despite disruption

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Toyota Motor Corp. is reviewing its production plans as growing global disruptions hamper the automaker’s attempts to ramp up production.

“We need to look at the conditions before us,” CEO Akio Toyoda told union leaders, according to a posting on the company’s website March 9. “If we don’t continue to develop strong production plans” with suppliers, “it will lead to burnout.”

Toyoda’s comments reflect the challenges the world’s top automaker faces as it tries to make up for lost production in recent months due to strained supply chains, COVID outbreaks, a cyberattack and disruptions resulting from Russia’s invasion of Ukraine. Toyota last month slashed its production target for the fiscal year ending in March to 8.5 million vehicles from a previous target of 9 million.

Although Toyota has not changed that target, it is forwarding a more “realistic” production plan to suppliers for the April-June quarter, human resources director Masanori Kuwata said March 9. later date, he added.

“As the union points out, a production plan that exceeds the capacity of personnel and equipment is abnormal,” Toyoda said earlier in his discussion with union leaders. The situation is “already at the limit”, he said.

Toyota was relatively resilient amid supply chain issues early in the pandemic and tried to ramp up production to meet growing global demand for new vehicles. The company said last month it expected to produce 950,000 cars and trucks in March, compared to 843,393 assembled in the same month last year.

“We learned firsthand, during times such as major recalls, the importance of prioritizing safety and quality above all else and not neglecting the people who support us on the pitch,” said Toyoda. “Together with suppliers and dealers, we want to work together to overcome the current crisis situation.”

According to Bloomberg Intelligence analyst Tatsuo, recent disruptions, including a cyberattack on a supplier that took all of Toyota’s factories in Japan offline for a day last week, mean it will be difficult for the company to recover. additional production for the fiscal year ending this month. Yoshida.

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