The automaker will create 40% fewer cars in September due to a shortage of semiconductors
Toyota shares fell by 4.4% after the announcement of production cuts
The securities of the automaker Toyota fell by 4.4% after the company announced its intention to reduce production in September by 40%. This follows from the trading data.
Prior to the news about the decrease in car production, Toyota shares were trading at a price of 9,640 yen (about $87.8) on the Tokyo Stock Exchange. Half an hour before the closing of trading, the price began to decline sharply, and by 15:00 local time it reached 9,295 yen (about $84.7). Thus, the drop was 4.4%.
At first, some publications wrote about the planned reduction with reference to sources, but then this information was confirmed in the company itself. Toyota cited the global shortage of semiconductors as the reason, which began at the height of the COVID-19 pandemic. The decision was also influenced by the fact that there is an increase in the number of coronavirus infections in Southeast Asia.
According to the updated plan, Toyota intends to produce 360,000 fewer cars in September than expected. Only at factories in Japan, production will be reduced by 140,000 cars — work at 14 facilities will be temporarily suspended.
At the same time, the company has not changed its goal for the financial year — as before, it is going to produce a total of 9.3 million cars by March 2022.
Also on August 19, Volkswagen and Ford announced plans to reduce production. The German carmaker is not yet sure whether it will have to reduce capacity and by how much. The American company also intends to temporarily close the plant in Kansas City, which produces F-150 pickups.
The global shortage of semiconductors affected Toyota less than its competitors. The company became the last among its colleagues in the sector to announce a reduction in production due to a shortage of components. In many ways, Reuters notes, Toyota managed to survive difficult times thanks to its strategic reserves of microchips — the company began storing surplus after the accident at the Fukushima-1 nuclear power plant in 2011.