Toyota confirmed over the weekend that it will need to suspend production at all its plants in Japan due to a blast at a plant of its main steel supplier. The blast at the plant of Aichi Steel Corp actually took place on January 8, but with the plant offline for repairs it meant steel supplies for clients have started to dwindle.
Toyota will suspend production February 8 and will restart things February 15 due to the tight supplies. Though the period is only a week, note that Toyota produced more than 4.0 million cars in Japan last year and according to Bloomberg the rate was close to 14,000 cars per day in December. Fortunately for the automaker, production outside Japan is unaffected.
The problem highlights one of the major drawbacks of Toyota’s Just-In-Time production methodology where minimal supplies are kept for efficiency. However, since the tsunami disaster of 2011 Toyota has worked to make its production facilities more flexible. Most of Japan’s automakers also agreed to cooperate with one another in the event of production disruptions.
The shutdown isn’t expected to significantly impact Toyota’s deliveries this year, though there could be some delays. Last month, we learned that Toyota managed to deliver 10.15 million vehicles worldwide in 2015 to retain its title of world’s biggest automaker. Toyota also confirmed that it will take full control of fellow Japanese automaker Daihatsu.
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