Toyota shares dip after unveiling more production cuts

Toyota slashed its fiscal year production outlook by about 300,000 cars.
By
| Updated on: 13 Sep 2021, 05:50 PM
Toyota shares fell as much as 2.5% in early trading in Tokyo on Monday.
Toyota shares fell as much as 2.5% in early trading in Tokyo on Monday.

Toyota Motor Corp. shares posted their biggest drop in three weeks after the company slashed its fiscal year production outlook by about 300,000 cars as the spread of coronavirus in Southeast Asia impacts its ability to procure chips and other essential parts.

Also Read: Toyota cuts production, to make 300,000 less cars this year due to chip shortage

Similar Cars

Find More Cars
Toyota Glanza (HT Auto photo)
Toyota Glanza
1197 cc | Petrol | Manual
₹ 7.18 Lakhs*Onwards
Toyota Urban Cruiser (HT Auto photo)
Toyota Urban Cruiser
1462 cc | Petrol | Manual
₹ 8.5 Lakhs*Onwards
Toyota Yaris (HT Auto photo)
Toyota Yaris
1496 cc | Petrol | Manual
₹ 9.16 Lakhs*Onwards
Toyota Innova Crysta (HT Auto photo)
Toyota Innova Crysta
2694 cc | Petrol | Manual
₹ 16.26 Lakhs*Onwards
Toyota Fortuner (HT Auto photo)
Toyota Fortuner
2694 cc | Petrol | Manual
₹ 29.98 Lakhs*Onwards
Toyota Camry (HT Auto photo)
Toyota Camry
2487 cc | Hybrid (Electric + Petrol) | Automatic (CVT)
₹ 39.41 Lakhs*Onwards

The world’s No.1 automaker said Friday it would be adjusting output in September and October and expects to produce 9 million vehicles in the fiscal year through March, down from the 9.3 million it previously anticipated. The company didn’t change its 2.5 trillion yen ($22.8 billion) operating profit forecast for the year.

Toyota shares fell as much as 2.5% in early trading in Tokyo on Monday, their biggest drop since Aug. 20 on an intraday basis. The stock is up more than 20% this year.

Toyota warned last month of cuts as Covid-19 spread through its core Southeast Asia manufacturing region, shuttering its suppliers’ plants in countries such as Malaysia and Vietnam. The announcement took the market by surprise as Toyota had up until that point largely remained unscathed by the parts shortages hammering its peers.

The latest production-cut announcement was also “a shock" given its magnitude and proximity to the first disclosure, said Bloomberg Intelligence analyst Tatsuo Yoshida. It shows that Covid conditions are changing so fast even Toyota, known for its supply chain savvy, isn’t able to predict the future, he said.

The question remains how the Southeast Asia supply snarls will impact other Japanese manufacturers such as Mitsubishi Motors Corp., Honda Motor Co. and Nissan Motor Co. that similarly have production hubs in the region.

Toyota’s latest announcement was a “wake-up call," Jefferies analyst Takaki Nakanishi wrote in a note. “This problem is not limited to Toyota and has spread to global OEMs," he wrote. Jefferies is now expecting Japanese automakers to cut output by 1.3 million units in the July-September quarter, higher than the 760,000 units it projected last month.

First Published Date: 13 Sep 2021, 05:50 PM IST
NEXT ARTICLE BEGINS

Provide some basic details and Get Personalized offers for

Choose city
+91 | Choose city
Choose city
Choose city
By clicking VIEW OFFERS you Agree to our Terms and Privacy Policy

Dear Name

Please verify your mobile number.

+91 | Choose city