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Steel Shortage Shutters Toyota’s Japanese Plants

One week closure to have major production impact.

by on Feb.01, 2016

The new 2016 Toyota Prius is one of the models to be hurt by the steel shortage.

Toyota will halt production at its Japanese auto assembly plants for a week due to a shortage of steel.

The week-long closure, which begins on February eighth, comes in the wake of an explosion at a steel plant operated by one of its key suppliers, Aichi Steel Corp. early last month. That has left Toyota struggling for the steel it needs for a variety of its operations, including powertrain and chassis components.

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“Operations are scheduled to recommence on February 15,” Toyota said in a statement, “and vehicle production on lines outside Japan will not be suspended.”


Toyota Won’t Abandon Japan

CEO Toyoda will maintain “illogical” Japanese production base.

by on Jul.15, 2011

It may be "illogical," but Toyota CEO Akio Toyoda won't give up on building cars like Prius in Japan.

As his nation struggles to rebuild after the devastating earthquake and tsunami of March 11, Toyota Motor Co. CEO Akio Toyoda says he won’t contribute to Japan‘s problems by shifting more automotive production offshore – even as it contributes billions of yen in losses to the world’s largest automaker.

There had been mounting fears in the troubled Asian nation – but hope among many investors – that the Toyota family heir would use the crisis to justify a shift away from the home market reliance that has made it difficult to resume production after the disaster.  Japan’s largest automaker, Toyota has traditionally positioned its hefty Japanese production base as a matter of civic responsibility, though in the weeks after March 11, Toyoda admitted it was becoming increasingly “illogical.”

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Toyota controls roughly half of the home market, but its production base there is far more than what’s needed simply to supply Japanese vehicle needs.  Competitors like Nissan have steadily fled offshore – Nissan CEO Carlos Ghosn closing four Japanese plants since taking over that company’s reins in 1999.  But while most of Toyota’s growth has been fueled by new plants in places like North America, Europe and China, the maker has been reluctant to walk away from its original production base.

“Toyota is a company that was born and raised in Japan and we can’t just abandon it because the environment is difficult,” said the grandson of the company founder, insisting the automaker would “grit our teeth and protect Japanese manufacturing.”


Toyota Warns It May Have To Move Production Out Of Japan.

Full-year earnings up, but exchange rate, recalls likely to yield 2nd-half plunge.

by on Nov.05, 2010

It's becoming increasingly difficult to keep building vehicles, like the Prius, in Japan, warns Toyota.

Toyota Motor Co. did markedly better during the first half of its fiscal year, a senior company official disclosed Friday, but while strong sales in key markets, such as Asia will help it deliver better earnings than expected for the current year, the rising value of the yen and its ongoing recall problems will result in a plunge in earnings during the second half of 2010.

Income for the full fiscal year, which ends March 31, 2011, is now expected to rise to 350 billion yen ($4.31 billion), up from an earlier forecast of 340 billion yen.

That projected improvement comes “despite the influence of the strong yen,” which has been a serious problem for the maker in dealing with its largest foreign market, the United States, said Toyota Managing Officer Takuo Sasaki, speaking through an interpreter, during a teleconference to discuss the company’s latest quarterly earnings.

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Looking ahead, Toyota now anticipates an exchange rate of 85 yen to the dollar, down from an earlier forecast of 90.  But on November 1, the exchange rate fell to its lowest level in more than 15 years, the yen plunging to 80.22 against the dollar.

“If we assume the (exchange rate) remains at 80 yen to the dollar, the environment will be extremely tough,” cautioned Sasaki, and would raise questions about how long the company can continue producing vehicles in Japan.