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Toyota forges ahead with 8.25m vehicle goal despite chip crunch

Automaker projects minimal impact from production cutbacks

A Toyota Motor factory in Toyota, Aichi Prefecture. The automaker does not expect a significant blow to production from the global chip crunch.

NAGOYA, Japan -- Toyota Motor is on track to produce about 8.25 million vehicles worldwide for the year ending in March, largely sticking to its previous forecast even though a global semiconductor shortage has disrupted the auto industry in recent weeks, Nikkei learned Monday.

The automaker released a forecast in November with that figure, a 6% decrease from fiscal 2019 for its Toyota and Lexus brands.

An updated plan for the January-April period shows the automaker is not expecting any significant changes to these numbers.

A chip shortage caused by the coronavirus pandemic has forced many automakers around the world to reduce production in recent weeks. Toyota is facing cutbacks on some models in the U.S., China and France. Still, it plans to offset these cuts by boosting production of models unaffected by the chip crunch. The automaker expects a net production cut of about 2,000 vehicles, a small fraction of its overall output.

Toyota experienced a plunge in production due to the coronavirus earlier this fiscal year, with output in some months falling 50% year on year. But the numbers have been recovering since the summer

Japanese production is estimated to come in around 2.95 million vehicles.

The automaker expects the trend to continue into the following fiscal year, which begins in April. It plans to produce about 800,000 vehicles globally in April -- twice as many as in April 2020, when it was squeezed hard by the pandemic, and 8% more than in April 2019.

The number takes into account sales trends for different models, as well as the supply of their components. "Different models are affected differently by the chip shortage," a Toyota executive said.

Still, the automaker has more or less secured its supply for the next three months, which is the usual lead time on semiconductors. It plans to finalize its full-year production plan for 2021 once it has a better idea of chip supply conditions in May and beyond, when expanded capacity at chipmakers could come online.

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