IRON and STEEL
Japanese auto producer Toyota is extending domestic vehicle output cuts into August as the Covid-19 pandemic continues to depress global sales.
Toyota said today it has decided to close all of its 15 domestic assembly plants every Friday in June. The firm also plans to halt output of 10 production lines at seven plants for two to seven additional days in June.
The company has reduced production to a single shift, from the previous two, at four production lines across three assembly plants for May-June. The measure will now be extended into July at one of the production lines and into August at another. The firm is also planning to additionally reduce production to a single shift at another production line for June-July.
Toyota has been forced to lower domestic output, as well as overseas output, in response to plummeting global vehicle sales affected by the pandemic. The company has predicted its global sales to drop by 22pc during the April 2020-March 2021 fiscal year, assuming that the global vehicle market will bottom out during April-June.
The company will make its best efforts to keep domestic output above 3mn units this fiscal year, said Toyota chief executive and president Akio Toyoda. Its domestic output fell to 2.8mn units in 2009-10 and 2011-12, while hitting 3.3mn units in 2019-20.
The falling domestic car output has also forced Japanese steel mills to cut steel output by temporarily halting blast furnaces (BFs). Japanese steel manufacturer Nippon Steel plans additional output cuts after July. JFE Steel has addressed the demand slump with the closure of two BFs but is not planning additional BF closures at this stage.
Japan's crude steel output is projected to fall by 26pc against a year earlier to 19.4mn t during April-June, the lowest quarterly output level in 11 years. While the country is starting to gradually end Covid-19 restrictions to resume normal economic and manufacturing activity, the country's crude steel output may fail to recover and fall below 80mn t this fiscal year after hitting the lowest level in 10 years in 2019-20.
By Rieko Suda