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Toyota Implements More Production Cuts in June as Chip Crisis Bites

The automotive industry is currently between a rock and a hard place. The switch to electric vehicles, while a worthy proposition, hit a snag after supply chain issues and component shortage issues erupted. On Tuesday, the largest car manufacturer, Toyota, said it will cut its global production plan by about 100,000 due to the industry-wide semiconductor shortage, Reuters reported.
2018 Toyota Camry 6 photos
Photo: Toyota
Toyota's European Manufacturing Plants and OperationsToyota's European Manufacturing Plants and OperationsToyota's European Manufacturing Plants and OperationsToyota's European Manufacturing Plants and OperationsToyota's European Manufacturing Plants and Operations
The current chip crisis isn’t taking any hostages, and like the rest of the automakers out there, Toyota has found itself in a position where it needs to make adjustments to curb the effects of the lack of chips.

In March, the Japanese giant announced it would halt production in one of its domestic plants, going offline for eight days due to a lack of semiconductors. It also made plans to cut global production by 150,000 in April.

On Tuesday, the bZ4X automaker announced that it would cut global production again by about 100,000 to about 850,000 units in June, due to the elusive microchips. However, the automaker did not change its estimate of producing about 9.7 million units worldwide by March 2023.

Additionally, the Japanese giant announced another factory line suspension, due to component supply shortages occasioned by tight lockdown measures in Shanghai, China. The suspension will last five days, beginning Wednesday to June 3. The break will affect 16 lines in 10 plants for May and June.

Toyota made an ambitious plan to launch 30 new BEVs by 2030, selling about 3.5 million battery-electric cars annually. But with the current setbacks occasioned by supply disruptions and elusive semiconductors, its plan might face similar obstacles.

Earlier in the week, the International Energy Agency said the cost of electric vehicle batteries would increase by 15% if raw materials used for production remain high. The agency advised industry players to stay vigilant and resourceful to reduce the risks of supply interruptions.

Last month, VW executives said there wouldn’t be any meaningful changes regarding the chip shortage this year or the next. The load of problems now falls on the consumers as EV prices hit the roof and the cost of fuel surpasses cost-effective levels.
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About the author: Humphrey Bwayo
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Humphrey is a car enthusiast whose love and passion for automobiles extended into collecting, writing, driving, and working on cars. He got his passion for cars from his Dad, who spent thousands of hours working on his old junky 1970 E20 Toyota Corolla. Years later, he would end up doing the same with a series of lemons he’s owned throughout his adult life.
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