AutoBeta(AutoBeta.net)05/18 Report--

After the global automobile market was hit by the novel coronavirus epidemic, it was almost completely disrupted, so that many car companies fell into a state of sluggish sales. In response to this situation, Toyota said a few days ago that it would suspend some factories and production lines in order to achieve the problem of overproduction.

According to Toyota, the shutdown will involve 15 factories in Japan, which will stop production for four days on June 5, 12, 19 and 26, while suspending production on 10 production lines for up to seven days.

In addition, Toyota also plans to adjust the production and operating time of some factories and production lines. Five of the production lines only operate on a single shift, and two of them will operate on a single shift until July. Another production line will operate on a single shift until August.

It is understood that the models produced in this part of the production line include best-selling models such as Prius gasoline hybrids, Corolla sedans and 4Runner sports utility vehicles (SUV). Of course, for specific operating plans, Toyota also said it may change according to changes in demand and parts delivery.

Toyota's cumulative production of 289500 vehicles in June last year means that production will fall by 40 per cent year-on-year to about 122000 after the cuts are implemented. Toyota has a total of 18 factories in the mainland, and 80% of the factories have stopped production this time, so I do not know whether it will be affected by the sale of models in the Chinese market.

In fact, earlier this month, Toyota planned to cut production at its North American plants by 30 per cent between April and October this year. Toyota's plants in the US, Canada and Mexico will produce about 800000 vehicles from April to the end of October, including its RAV4 SUVs and Camry sedans, which represents a 29 per cent year-on-year decline in production and a 32 per cent drop from the January forecast.

It is worth mentioning that before the outbreak, Toyota also planned to produce about 3.24 million new cars in 2020. But Toyota has halted some production lines at its Japanese plants in March and April, and production at Toyota's Japanese plants will be cut further in May and June. this means that Toyota's annual production of 3 million vehicles may not be achieved, while annual production of 3 million vehicles is Toyota's "red line", once below the red line, Toyota will have to consider layoffs.

Therefore, affected by the outbreak of the epidemic, Toyota's sales in fiscal year 2019 decreased by 127000 units, net revenue also decreased by 380 billion yen, and operating profit lost 160 billion yen. The company expects operating profit in fiscal 2020 to plunge 80% from the previous fiscal year, the lowest since fiscal 2012.

According to Toyota's data for the first quarter of 2020, its cumulative global sales were only 2.3169 million vehicles, down 11% from a year earlier. Toyota's first-quarter operating profit fell 28 per cent to $3.56 billion, while net profit fell 86 per cent to $585 million, according to the results. This has also led Toyota to be bullish on the Chinese market in order to balance profits.

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