Toyota Lowers 2022/2023 Production Target Amid Chip Shortage

Toyota has announced that it will lower its global production volume for the fiscal year that ends in March 2023 due to persistent chip shortage. Despite having to lower targets for the last fiscal year, the best-selling carmaker had announced in May this year that it planned to produce 9.7 million units this year.

At the end of September 2022, the company continued to cling to their goal, stating there would be “no change” despite missing interim targets during the first part of the fiscal year—according to Reuters, the company fell short in the first five months by 6.7%. Production improved in August but October brought about a different tune with the announcement.

Initially, Toyota planned to produce an average of 850,000 units per month in the last quarter of 2022, but has since lowered global production volume for November 2022 to 800,000. Toyota confirmed that it has scheduled to halt eleven production lines in their local facilities for between two to nine days. The company, however, has yet to announce the revised year-long target.

This issue has been in large part due to the chip shortage that doesn’t seem to have an end in sight, a problem faced by the entire auto industry. The expectation of economic recession in major markets have also dampen outlook, with Tesla’s Elon Musk stating that “a recession of sorts” have been affecting demand for the electric car company’s products in  China and Europe. If two of the best-selling car brands are “feeling it”, we can assume that worst is yet to come…