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Toyota Motor Corp on Thursday said that it was planning to produce about 800,000 vehicles globally in October. This is around 100,000 short of the average monthly production plan presented earlier due to semiconductor shortages, claims the Japanese car brand. Last month, Toyota said that its average monthly production plan from September through November would be around 900,000 units. The latest announcement comes as a straight blow to that previous production strategy.
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Interestingly, despite the dented production strategy in October, the world's largest automaker by sales is sticking to its 9.7 million global vehicle production target for the current financial year through March 2023.
Toyota is not the only car manufacturer that has been impacted due to the chi shortage. Several other automakers from all parts of the world have been affected by the crisis. Several automakers had to shut down their manufacturing plants for temporary periods owing to the chip shortage.
Modern cars are heavily reliant on software and advanced technologies. Microchips or semiconductors act as the brain of these cars. The microchips control a wide range of functions in modern cars, from safety systems to infotainment, from powertrain to fuel economy. A severe shortage of chips has therefore impacted automobile production around the world.
The chip crisis started as a byproduct of the Covid-19 pandemic. At the beginning of the pandemic, when the world economies announced lockdown in an attempt to curb the spread of the virus, demand for consumer tech products that are also heavily chip-powered increased multifold. At the same time, auto manufacturing factories were shut down, resulting in the chipmakers shifting their focus on consumer tech products. Later, when the auto companies restarted their production after the gradual reopening of the economies around the world, chip manufacturers were not able to cope with the demand, creating a mismatch between the supply and demand ratio.