Toyota may be cutting back its global group production by 200,000 units in the 2012 calendar year, writes Reuters, as a reaction to sharply reduced sales in China after the island row. Toyota’s China sales were down 49 percent in September.
The story is based on a report in the Mid-Japan Economist newspaper, which is published near Toyota’s Aichi HQ. The paper confirms what TTAC had said for months, namely that Toyota wanted to produce slightly more than 10 million cars this year. If the report is right, this number would drop to 9.8 million. Even at the reduced level, Toyota would likely regain the top spot, with GM close behind. We will know more about GM when it publishes its Q3 data in a few days.
If the story is correct, then the China protests create bigger damage than thought. The 200,000 unit cutbacks would amount to more than half of the planned China production for the last four months of the year.
Toyota spokeswoman Shino Yamada told Reuters that “the figure cited in the report is not based on anything announced by us, and at this time there are no changes to the figures we presented earlier.” In August, Toyota had announced plans for 10.05 million cars for the calendar year. Yamada-san is right, the 300,000 less were not announced.
Bertel, I would imagine the declines to have peaked in September and sales will gradually recover from October onwards. Is that case or is there still a lot of hatred for Japanese brands on the streets?
I think we will see big declines in October. In China, the brunt of the troubles did not start in earnest until mid-Sept.
It isn’t so much “hatred for Japanese brands.” It is that the cachet of a foreign brand has changed into something one is ashamed of. Not a good position in a buyer’s market. Nobody torches Japnese cars anymore in China. However, nobody is impressed by Japanese cars anymore either, and this is far deadlier than a few torched cars.
According to unofficial reports “things have improved slightly” in the showrooms. Even the sought-after German cars are selling at big discount, not a good market for image-impaired goods.
“Toyota’s China sales were down 49 percent in September.”
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“The 200,000 unit cutbacks would amount to more than half of the planned China production for the last four months of the year.”
If the above are correct, it is impressive that Toyota has the discipline to cut production in half in response to demand being cut in half rather than continuing to build and let inventory get out of control.
A lot of the ideas in the “Toytota Production System” are easy to understand, but hard to actually do. How many other companies would react so quickly and decisively to rapidly falling demand?
Doesn’t surprise me, not that people here in China don’t want Japanese cars so much as they don’t want them destroyed by someone on the street.
This also makes it easier for VW to become number 1 worldwide in vehicle sales as most buyers are going to VW, with some to Hyundai/Kia and a small amount to GM.
it is impressive that Toyota has the discipline to cut production in half in response to demand being cut in half rather than continuing to build and let inventory get out of control.
costs money & time to build them, should they cannot move then u only see portions of investment back, dont forget 2013 will be around the corner, what to do with 12 cars? sell at discount?
I guess they dont have Unions to dictate how many shifts ought to have.
The Japanese auto situation in China is interesting. But in China, sometimes things may be different than what is suspected on the surface. With politburo selections coming soon, and a formal power handover on the way (but only formal-after all, this is a nation where Jiang Zemin has been out of power for almost a decade, but still wields considerable influence), there’s a lot to consider.
The posters of Mao imply much, but it is not clear what faction is behind it. In many respects, this show of left wing rabble rousing could be meant more for certain current leaders (the Hu faction) than as a protest against Japan.
From a practical standpoint, a Chinese friend has a Toyota, and tells me he is afraid to drive it over fears from his fellow citizens. One is reminded of the Cultural Revolution, in a way.
This time Nippon’s PM Noda san, kind of spelled Nadir in trades with Middle Kingdom especially Wheels. Toyota, Nissan , Happy Honda & Zoom zoom zoom Mazda et al are all steaming into the iceberg at 1/2 speed now.
These cars are contrary to one time flying off the shelf but just can’t seem to give them away, whoever in Middle Kingdom buys a new rice rocket is kind of walk around with a dead Albatross around one’s neck.
His excellency Noda is basically re-arranging the deck chairs on Costa Concordia. Soon enuf he’ll have to either change course on the little Islands aka the Senkaku or change his employment address.