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On Monday, Toyota Motor Corp. revealed it plans to produce as many as 10.6 million vehicles this year, but cautioned that there was a chance that problems caused by COVID-19 virus spreading, and a lack of parts could have a negative effect, and cause the prediction to be lowered.
The automaker also said that final production could be 10% lower if it is unable to obtain adequate parts, particularly semiconductors.
Nevertheless, Toyota’s 2023 production figure forecast shows the company is feeling more confident about its supply chain going forward. Production figures are for Toyota and Lexus brands, but not for its Daihatsu minicar or Hino truckmaking subsidiaries.
As the top automaker in the world, Toyota serves as a barometer for the rest of the industry and its suppliers. Last week, Volkswagen AG stated it anticipated supply constraints to loosen and that it was optimistic about 2023, citing increased orders. But increasing prices for materials and logistics, as well as parts shortages brought on by COVID-related lockdowns have challenged the auto industry for the past few years.
COVID-19-related impacts
If the bullish forecast holds true, that would mean the automaker would produce 1.4 million vehicles more than 9.2 million cars and trucks the company built during its 2022 fiscal year, which ends in March. The final 2022 production figure was lower than the 9.7 million units it predicted would build all year, with cuts finally being announced in October 2022.
The automaker’s 2022 cuts affected 11 out of 28 lines in eight of its 14 plants. The reduced production saw Toyota surrender its spot to General Motors as the largest automaker in the U.S. for calendar 2022. Affected product lines in 2022 included the Toyota Corolla, Corolla Cross, RAV4, Camry, Crown, Land Cruiser Prado and 4Runner, as well as the Lexus LS, IS RC, NX, UX, ES and GX.
Although supply chains are improving, there are still issues. For January, Toyota’s planned global production volume is projected to be about 700,000 units; 200,000 units in Japan and 500,000 units overseas. Toyota is suspending production lines at its Tahara plant, where it builds the Land Cruiser Prado, Lexus GX and 4Runner, as well as at its Hamura plant, which also builds Land Cruiser Prado.
In Japan, the company has been rationing semiconductors, in part by delivering new vehicles with one smart key instead of two on 14 models including the Crown, the Prius and the battery-electric vehicle bZ4X.
While the company remains optimistic, it does so with a note of caution.
“The situation this year remains difficult to predict due to factors such as semiconductor shortages and the spread of Covid-19,” Toyota said.
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