Toyota faced a supply chain shortage during the Shanghai lockdown because of Covid-19, it had led to stoppage of product delivery.
On Tuesday, Toyota announced a pause on production line over 10 Japan based plants due to the lockdown in Shanghai, the company is being challenged and facing supply shortage for the company production.
According to the press release, the company re-examine its global production in June, predicted for about 850,000 vehicles and showed semiconductor shortage with tens of thousands fewer vehicles. This shortage and the impact of a pause can impact half of Toyota’s Japan production line and car model which includes Prius, Toyota Corolla and RAV4, this discontinuation will expand up to five days.
In Shanghai, the things have been at ease but in some parts of the city COVID-19 restriction is found, this sudden pause on vehicle production displays immediate impact over global manufactures.
Toyota has declared a progression on news earlier, as the company announced about temporary pause and suspension of production on 14 lines across eight plants and it stopped its May production which was predicted by 50,000 vehicles because of the supply chain issues caused during the Shanghai lockdown.
Toyota production has been paused due to Shanghai Lockdown.
The company has not re-examine its production plans entirely for the fiscal year, they plan to produce nearly 10 million vehicles in fiscal year 2023. As per the Toyota statement, They will continue to make each effort possible to deliver their customers at their earliest time.
Covid-19 Shanghai Lockdown impact on production
During the spread of COVID-19, it led to the impact of shortage which caused delays and inconvenience to their suppliers, customers and other parties.
According to Last month, the company revised their production plans to be reasonable with recent realities and plan to situate for “intentional pause’ from April to June month. This global production strategy with a plan is approximately 750, 000 units which includes 200,000 units in Japan and another 550,000 units overseas. But, as the impact of shortage in semiconductor, the company has modified the production plan by approximately 100,000 units globally provided to their suppliers by the starting of the year. Their global production plan average is from May through July which is around 800,000 units.
According to Global automotive practice at Strategy Analytics, vice president Ian Riches mentions, the effects are likely to be noticed by U.S. customers, who have observed the delay for a longer period for their Toyota vehicles and face fewer choices in the market.
Covid-19 impact led to changes in Toyota production plan.
The abruption to Toyota’s manufacturing has resulted in compounding supply chain trouble hitting the global automotive industry which includes semiconductor shortage and nearly two months long expanding lockdown in Shanghai, added by Riches.
Toyota apologized for this repeated adjustment and modification to their production plan which is the cause of the resulting shortage and Covid-19, it has affected suppliers, customers and other party members.
The company shares the forecast average global production plan from June to August to be around 850,000 units and 9.7 million units in the overall period of 2023 year. This shortage, which is being exposed on semiconductor, spread of COVID, other factors for the company made it challenging to look ahead, they assured to make each effort possible to deliver as many vehicles to their customers.