Toyota Output:

 https://mainichi.jp/english/articles/20210929/p2g/00m/0bu/036000c

Article:

NAGOYA (Kyodo) -- Toyota Motor Corp. said Wednesday its global output dropped 16.2 percent in August from a year earlier to 531,448 units, the first fall in a year, due to parts shortages amid the spread of COVID-19 in Southeast Asia and a semiconductor crunch.

Toyota has already announced plans to curb production in September and October, clouding the outlook for an auto sector that has staged a strong recovery in sales in key markets including China and the United States.

The world's top-selling automaker has trimmed its output outlook for fiscal 2021 through next March to 9 million units, down 300,000 from its initial plan.

Ideas:

Not only Toyota but most likely all automakers globally are either doing the same thing or making plans to reduce domestic and global output.

There are two parallel forces in play here; one being the semiconductor chip shortage and at the same time there is still a real supply chain problem globally.

If you consider logistics and supplies there are some real challenges. For example, as reported in my news outlets in the US alone there are as many as 50+ container ships sitting in the Pacific Ocean waiting to be unloaded as there aren't enough workers at the LA and Long Beach ports in California. 

And most likely there might be challenges in many other ports globally.

Of course now that Toyota and most likely most automakers have reduced their output and supply what is that going to do to car prices in the future. Are they going to bite the bullet and accept lower total sales or are they going to raise prices to keep the same amount of profit to keep shareholders happy.

Article:

Global sales in August rose 3.9 percent to 748,893 units, marking the 12th straight monthly gain, Toyota said.

Southeast Asia serves as a key manufacturing hub for automakers but factory shutdowns in countries such as Malaysia and Vietnam due to the pandemic have made it difficult to secure enough parts.

It has caused an additional headache for automakers already scrambling to cope with global semiconductor shortages. Chips are used in everything from laptops and game consoles to electronic devices and cars and the pandemic has boosted demand for some of those products.

Ideas:

Japan and Toyota can no longer afford to think Japan only because businesses and economies are so interconnected that problems in other countries can effect everything on all countries. 

So even production in Japan can be heavily effected by challenges in Malaysia and Vietnam where automakers in the Japanese domestic market are effected by what is happening in other countries.

And then there is the additional challenges to the Japanese economy and not just automakers as chips are now used in almost everything that is electronic.

There might be not shortages or supply problems yet, but all of these companies that rely on chips are now in competition with everyone else to find and get the chips they need.

And of course there are always positives and negatives in any economic activity. While the pandemic is a terrible thing it has boosted demand and increased business for some areas such as chip making companies.

Article:

In August, Toyota reported a 19.9 percent fall in overseas output to 345,722 units while domestic production dropped 8.4 percent to 185,726 units.

By region, production in China tumbled 30.3 percent from a year ago while Asia as a whole except Japan reported a 21.4 percent drop. Output fell 14.6 percent in North America.

The automaker expects global output to roughly halve in September and decrease around 40 percent in October from its original plans. The impact of recent production curbs on sales is expected to become apparent in the months ahead.

Ideas:

It would be interesting to know just what surplus or supply Toyota has despite the reduction n output. Do they have for example enough supply for the rest for 2021.

But according to the article Toyota might not even have enough surplus or excess supply to make to the end of 2021 and most likely at that time global sales will begin to decrease a lot.

So are there going to be long waiting periods for some cars or are car buyers going to buy before the supply runs out.

A 50 to 40 percent decrease in production can't be good for the company's profits if they really are cutting back that much. 

And again most likely this is the situation with many of the car makers. Can they survive this much decrease in output. Or maybe they have a surplus of cash reserves or other such resources to be able to survive.

And then you add in all of the other companies that are related to the car industry and you see a huge supply chain challenge and just how are all of these related companies going to survive with  40 to 50 percent decreases in production.

Article:

In August, Toyota sold 637,324 units overseas, up 3.4 percent. While the spread of COVID-19 prompted some dealerships in China to shut, sales in North America, where RAV4 compact crossover SUVs are popular, were more or less flat.

Buoyed by strong demand for the Yaris and Roomy compacts, sales in Japan rose 6.7 percent to 111,569 units. The figure in Japan includes sales of minicars with engines of up to 660 cc.

Ideas:

So it depends on the supply and demand of some Toyota models. Maybe some models are going to be OK with the production and sales and some models are not going to be OK.

Then Toyota be trying to create a safe-guard strategy where it picks and choose which models to continue to produce depending on present and estimated demand.

Most likely all the car makers are making the same kind of strategy decision depending on what cars or most in demand and try to keep those in production and closing those not in demand and closing them to try as much as possible a complete shutdown due to the chip shortage.

And then just recently in Japan there is a new type of strategy to get consumers into new cars. Car makers are now using a subscription type program, somewhat similar to leasing but not exactly the same thing.

The new subscription program, where a customer might sign a three, five, or seven year contract which provide for insurance and maintenance is very popular among young people who don't want to own a car. The customer doesn't own the car but uses it like its his or her car.

And also at the same time car-sharing is becoming more popular in Japan as again those using the car don't own then but use it like its their own.

Subscription programs might be the future, besides electric type cars for car makers especially in the big cities in Japan. 

Have a nice day and be safe!