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Recently, Toyota released financial results from April to September in the first half of 2022, which showed that Toyota sales rose 14.4 per cent to 17.7093 trillion yen in the first half of the fiscal year as the depreciation of the yen against the US dollar boosted profits. Toyota car sales rose 1.6% from April to September compared with the same period last year, to 4.159 million vehicles. But net profit was 1.171 trillion yen (57.6 billion yuan), down 23.2% from a year earlier.

As for the decline in net profit, Toyota said that profit growth brought about by the depreciation of the yen also failed to hedge against rising costs due to rising prices of raw materials such as steel and aluminum. Toyota also said it cut its global production plan for fiscal year 2022 to 9.2 million vehicles from 9.7 million earlier.

At the same time, Toyota stressed that although production capacity and sales may be affected, it will keep its full-year net profit forecast for the 2022 fiscal year (ended March 31, 2023) unchanged at 2.36 trillion yen (116.4 billion yuan). The full-year forecast remains unchanged, which also means Toyota will increase its net profit in the second half of the fiscal year. Toyota is planning to raise the price of its vehicles in Europe and North America to offset some of the falling profits caused by rising costs and chip shortages, according to Jun Nagata, Toyota's chief communications officer.

It is worth noting that Toyota was also forced to stop production in the second half of this year due to chip shortages, the COVID-19 epidemic and other uncertain factors. In July, for example, Toyota said on July 27th that a production line at the Toyota Takaoka plant had suspended night shift operation due to the COVID-19 epidemic, resulting in a loss of production of about 650 vehicles. Toyota said on July 28th that it was difficult to purchase spare parts because of heavy rain. Toyota said on July 28th that production was suspended in 2 of 28 production lines in 14 factories in Toyota's local market. As a result, Toyota cut domestic production by about 4000 vehicles in July.

Toyota said on July 29th that two factories affected by the torrential rain had resumed normal operations, while two production lines at another plant had extended the shutdown time, affecting about 1000 vehicles and a cumulative total of about 5200 vehicles affected by the torrential rain. In addition, at the end of July, Toyota was forced to suspend production at its Japanese plant affected by the epidemic, resulting in delays in the production of models such as the Corolla.

Toyota has also cut its monthly production several times since June. On June 16, Toyota lowered its global production plan for June from 800000 to 750000; on June 22, Toyota lowered its global production plan for July from 850000 to 800000; on July 19, Toyota cut its global production plan for August from 850000 to 700000, and on September 22, Toyota lowered its global production plan for October from 900000 to 800000. On October 21st, Toyota announced plans to produce about 800000 units in November, including about 250000 in Japan and 550000 in overseas markets. Global production this fiscal year is expected to be lower than the original plan of 9.7 million vehicles, it said. This is the second year in a row that Toyota has cut its annual production plan after fiscal year 2021. Toyota had earlier planned a production target of 9.3 million vehicles at the beginning of fiscal year 2021, but it actually produced 8.56 million vehicles in fiscal year 2021.

Of course, Toyota's frequent production cuts and factory shutdowns undoubtedly have a certain impact on its sales. According to relevant data, Toyota produced a cumulative global production of 3593807 vehicles from April to August this year. Among them, Toyota's global production in April 2022 was 692259 vehicles, down 9.1% from a year earlier. Production in May was 634940 vehicles, down 5.4 per cent from a year earlier. Production in June was 793378 vehicles, down 4.59 per cent from a year earlier. Production in July was 706547 vehicles, down 8.6 per cent from a year earlier. Production in August was 766683 vehicles, up 44.2 per cent from a year earlier. As for the decline in production from April to July, Toyota said it was mainly affected by the epidemic and shortage of semiconductor parts, and the factory shutdown made Toyota's production lower than the previous year's level.

Judging from the downgrade of Toyota's full-year production plan, it is not difficult to see that it is still affected by the shortage of chips. As for when the chip shortage will be alleviated, Sam Fiorani, vice president of global automotive forecasting at AFS, said the chip shortage is expected to last until at least mid-2023. At present, the automotive industry is still in a state of shortage of key components, and people in the industry expect that the problem of chip shortage will continue in the short term and is not expected to ease until next year.

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