Selloff or Market Correction? Either Way, Here's What to Do NextSee Overvalued Stocks

Toyota misses May production target in third monthly shortfall

Published 06/29/2022, 12:32 AM
Updated 06/29/2022, 05:20 AM
© Reuters. FILE PHOTO: 2023 Toyota bZ4X all-electric SUV is displayed during the 2021 LA Auto Show in Los Angeles, California, U.S. November, 17, 2021. REUTERS/Mike Blake/File Photo

By Satoshi Sugiyama

TOKYO (Reuters) -Toyota Motor Corp's global production for the first five months of 2022 fell 9.7% short of its own target on average, raising questions about whether the Japanese automaker will be able to maintain its current target for the year.

The world's largest automaker by sales said it produced 634,940 vehicles in May, 5.3% fewer than in the same month last year and short of its target of about 700,000.

It was the third consecutive month that Toyota has missed its monthly goal.

The company has stuck to its target of a record 9.7 million vehicles for the year ending March 2023 but has floated the possibility that its production plan "may be lower".

Toyota initially fared well during the global semiconductor crunch due to a large stockpile of chips but has repeatedly cut production this year due to shortages of key chips and components as well as supply disruption due to COVID-19 containment measures in China.

Toyota is likely to stick with its current annual target provided that no additional negative factors arise as it aims to make up for lost output in the latter part of the fiscal year, said Seiji Sugiura, a senior analyst at Tokai Tokyo Research Institute.

"It is not impossible to make 900,000 units per month, for example, in the second half of the year, so maybe there is still a place where it is thinking of making up for (the production) there," he said.

For June, the automaker has twice downgraded its production target. The latest forecast is 750,000 vehicles, roughly 12% below its original estimate of 850,000.

The automaker has already called April-June an "intentional pause" in production to relieve the burden on its suppliers.

At home, production slumped by 28.5% in May but rose 4.6% overseas.

Europe was among regions where production increased because it was not hit as hard by the chip shortage.

Production also rose in countries including Thailand and Indonesia which were significantly affected by COVID-19 outbreaks last year.

© Reuters. FILE PHOTO: The Toyota logo is pictured at the 43rd Bangkok International Motor Show, in Bangkok, Thailand, March 22, 2022. REUTERS/Athit Perawongmetha/File Photo

Toyota in mid-April said it planned to produce 750,000 vehicles in May but soon lowered that by 50,000 due to COVID-19 lockdowns in Shanghai.

In January-May, Toyota's global production averaged 713,172 vehicles a month, 9.7% below its initial monthly average forecast of 790,000 units.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.