The Chip Shortage Strikes Again: Toyota to Cut Output by 40 Percent

• Toyota will see temporary cuts to its vehicle production in August and September, and expects a 40% drop in global output.

• The chip shortage has affected numerous automakers, as semiconductor suppliers have struggled to switch back to automaker chips.

• Several major assembly lines in North America have seen downtime this summer, as automakers have struggled with chip stockpiles.

Late this week Toyota said that it would drastically cut vehicle production in the month of September, citing the current chip shortage. The automaker indicated that global output would see a 40% drop through next month, Nikkei reported earlier this week, and expects a drop in production in North America during this timeframe. The automaker has cited coronavirus infections in Asia for the downtime in addition to the chip shortage, and now plans to produce 500,000 vehicles in September, instead of some 900,000, according to Nikkei.

The automaker has posted a detailed table of planned factory downtimes. Some of the production lines will see a suspension during the entire month of September, including those that build the Century and the Land Cruiser, while others will see stoppages of just a few days in September or a single day as in the case of the Land Cruiser 70, which is still in production and does not require all that many chips.

The automaker's Hamura plant, part of Hino Motors, that produces the High Mobility Vehicle—Toyota's Humvee-style SUV—will merely see a two-day suspension of production in September. The company's Kyoto plant, which is a part of Daihatsu Motor Corporation, will see three days of downtime for its Probox van. The automaker's Gifu Auto Body plant that produces the Coaster mini-bus will see just one day of downtime next month.

However, all plants in North America will see temporary stoppages of at least several days, except for the San Antonio, Texas plant that produces the Tundra and Tacoma pickup trucks.

Toyota is by no means the only manufacturer forced to suspend production for days and weeks due to the global chip shortage, and it has actually avoided some of the more painful stoppages experienced by other automakers over the past year. In the month of July, General Motors had halted production at its Lansing, Michigan plant for several weeks, stretching well into August, with the plant producing the Buick Enclave and Chevrolet Traverse. Production halted July 19 and has yet to resume.

Ford plans to halt production at its Kansas City plant that builds the ever-popular F-150, with the automaker planning to idle the line for a week starting August 23.

The chip shortage itself was sparked by the semiconductor suppliers' turn to makers of personal electronics in the months after the pandemic began, with suppliers now struggling to increase output to match demand from a resurgent auto industry. The chip shortage has produced weeks of production downtime for many automakers in the U.S. and overseas for the past year, and is expected to persist into 2022.

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