The cutbacks at Toyota’s plants are the latest sign that the chip shortage will hang over the industry well into the second half of the year.
“Due to COVID-19 and unexpected events with our supply chain, Toyota is experiencing additional shortages that will affect production at most of our North American plants,” Toyota Motor North America said in a statement shared with Automotive News. “While the situation remains fluid and complex, our manufacturing and supply chain teams have worked diligently to develop countermeasures to minimize the impact on production. … We do not anticipate any impact to employment at this time.”
Toyota and Lexus dealers, who have been getting by for months working with some of the leanest inventories in an industry at historically low inventory levels, are about to see even that trickle of vehicles dry up.
In an email to dealers Tuesday from Southeast Toyota Distributors, the automaker’s largest U.S. distributor, that was shared with Automotive News, it counseled dealers to accurately report their sales so that they would get their appropriate allocation of available vehicles, a spokeswoman for the distributor confirmed. Southeast Toyota distributes Toyota vehicles to 177 dealerships across Florida, Georgia, Alabama and the Carolinas.
“Due to the uncertainty of future production dates, TMNA has provided guidance to exclude North American production weeks from tonight’s [mid-month] allocation,” the note said. “We will continue to assess the stability of future build weeks and will postpone allocating unbuilt production until we have a higher level of confidence in the supply chain.”
The note goes on to detail a revised allocation pool consisting of just 1,830 vehicles “solely comprised of confirmed [completely built units] production already in transit to our Vehicle Processing Centers.”
Toyota Motor North America began August with 139,600 vehicles in dealer inventory or on the way to dealers, with 26,900 of those being Lexus vehicles and the remainder wearing a Toyota badge, according to the Automotive News Research & Data Center. That gave Lexus a 23-day supply and Toyota a 16-day supply of new vehicles to sell.
Toyota Motor North America sold 225,022 new vehicles in the U.S. in July, and 191,842 in August 2020. In the second quarter, it narrowly outsold General Motors on the domestic automaker’s home turf — 688,812 to 683,696.
Two senators from Michigan and one from Ohio have sent a letter to Hsiao Bi-khim, Taiwan’s de facto ambassador in Washington, asking the nation for more help addressing the semiconductor chip disruption.
The letter, signed by Senators Gary Peters and Debbie Stabenow from Michigan and Senator Sherrod Brown of Ohio, praised Taiwan’s efforts so far but asked for more help as the automotive industry continues to struggle to produce cars as a result of the supply issue.
The senators said they were “hopeful you will continue to work with your government and (chip) foundries to do everything possible to mitigate the risk confronting our state economies.”
Read Also: GM Is Parking 1,000 SUVs And Trucks Every Day As It Awaits Chips
Intermittent production cuts have plagued the industry for the last year as semiconductor chip suppliers face their own COVID-19 disruptions and, in many cases, focused their efforts on the consumer electronics industry that boomed during the pandemic.
“What we are hearing at this point is that the risk of shortages clearly has extended into 2022, despite the considerable efforts in Taiwan to augment production,” the senators wrote.
Speaking to Reuters, Taiwan’s Foreign Ministry said that it has been working closely with the United States to address supply chain issues.
“We believe that Taiwan and the United States can jointly establish a safe and reliable supply chain for key industries,” the ministry said.
Taiwan Semiconductor Manufacturing Co Ltd, the world’s largest contract chipmaker, was also hopeful last month when it announced that shortages would gradually tail off this quarter for its customers. It also expects overall semiconductor capacity tightness to continue into 2022, though. Indeed, a number of automakers are now reporting that they will suffer production shortfallsin the coming months as a result of the supply disruption.
“Demand for vehicles—from cars to commercial trucks—is now up, yet the lack of semiconductor chips is preventing this renewed demand from being met,” the senators wrote. “The U.S. is now the most impacted region in the world.”
Whether or not the Taiwanese government will be able to affect change remains to be seen, but semiconductor supply issues seem likely to continue in the near future no matter what.
Volkswagen and Toyota have become the latest carmakers to warn about production cuts because of the global computer chip shortage.
German car manufacturer Volkswagen said a semiconductor supply crunch could force it to slow production lines during the autumn, adding to cuts that have been in place since February. Japanese firm Toyota also reported that it would slash output by 40% in September.
Carmakers have struggled after a recovery in demand stretched supply chains earlier this year, with Covid-19 outbreaks across Asia hitting chip production and operations at commercial ports.
“We currently expect supply of chips in the third quarter to be very volatile and tight,” said Volkswagen, the second largest carmaker behind Toyota.
“We can’t rule out further changes to production,” the company told Reuters.
The Wolfsburg-based carmaker said it expected the situation would improve by the end of the year, and aimed to make up for production shortfalls in the second half as far as possible.
New car prices have begun to rise in response to the limited supplies of cars, but the most noticeable impact has been on the secondhand car market, where prices have jumped by 14% year on year in the UK and more than 40% in the US.
Toyota said it intended to reduce global production for September by 40% compared with its previous plan, according to the Nikkei business daily. This pushed its shares down by 4.4% on Thursday.
Shares in European carmakers and suppliers were also broadly weaker, with BMW, Daimler, Renault, Volkswagen and Stellantis – the maker of Peugeot and Fiat cars – all down by more than 2%.
The latest production woes follow news that German chipmaker Infineon, the top automotive supplier, was forced to suspend production at one of its plants in Malaysia in June, due to a coronavirus outbreak.
Reinhard Ploss, the Infineon chief executive, said earlier this month that the automotive industry faced “acute supply limitations across the entire value chain” and it would take until well into 2022 for supply and demand to be brought back into balance.
Analysts at ING said some Taiwanese semiconductor companies unaffected by the Delta variant of Covid-19 were pushing production beyond the usual 100% to satisfy demand.
Ford said on Wednesday it would halt output for a week on production lines that build its bestselling F-150 pickup trucks because of the shortage. The shutdown will begin on Monday.
Earlier this month, General Motors suspended production for a week at three North American truck plants, while Nissan halted it for two weeks at a Tennessee plant because of a Covid-19 outbreak at a chip plant in Malaysia.
Phone and computer makers have also reported semiconductor shortages. Apple executives said that while the impact was less severe than feared in the third quarter, it would get worse in the current quarter, and could hit iPhone production.
Last year brought the end to more than 20 vehicles. Halfway into 2021, automakers have already announced nine models headed toward indefinite retirement for the 2022 model year. Some, like the Volvo V60 and V90 wagons, will see parts of themselves live on. And arguably the best version of Hyundai’s Veloster will continue. Others, like the Volkswagen Passat and Honda Clarity are getting booted to make room for more electrified lineups in the future.
The Honda Clarity EV was discontinued in 2020, killing the only fully electric Honda in the United States market. And now, the remaining plug-in hybrid and hydrogen fuel-cell versions are gone too. Honda says the Clarity will be available as a lease through 2022, with Clarity FCV leases limited to California. The Clarity’s departure leaves the Hyundai Nexo and Toyota Mirai as the only two FCVs available in the U.S. By that, we mean only in California. Although Clarity sales nearly matched the Chevrolet Bolt in 2019, last year wasn’t as fruitful with just 1617 units moved. The Clarity FCV qualifies for up to $5000 in California Clean Vehicle rebates, an HOV lane pass, and a fuel card for $15,000 worth of hydrogen fueling from Honda. The silver lining here is that Honda is likely making room for new models as part of their plan to sell only battery-electric and hydrogen vehicles by 2040.
The compact-car segment loses another player to team SUV. Hyundai’s beloved three-door hatchback is outta here. Although one of the cheapest cars sold today is leaving us, the 275-hp Veloster N lives on (at least for another year) while the Korean automaker shifts focus to its more popular Kona and Venue SUVs. And we’ll remind you that the Veloster N, equipped with the eight-speed dual-clutch transmission we tested last year, was the second-quickest front-wheel-drive car we’ve ever tested. Just 2205 Velosters have been sold in the first six months of 2021. That pales in comparison to current Kona sales at 50,996. The Venue has moved 15,050 units, outselling the Accent and the Ioniq. Now that Hyundai is busy engineering new rides for its all-electric E-GMP platform, there’s not much room for models that don’t sell. Next year there will be just four cars in Hyundai’s 10-model lineup.
Back in 2015 we fit six all-wheel-drive subcompact crossovers into a former staffer’s backyard because they were toylike and well, his backyard was a big playground. The Mazda CX-3 won big in that snack-size comparison test. It beat the Jeep Renegade, Honda HR-V, Kia Soul, Fiat 500X, and the Chevrolet Trax. Unfortunately, in 2022, the CX-3 is the loser. Even in a package with less cargo space than its smallest sedan and hatchback, Mazda’s suspension tuning was optimized for low body roll without turning the ride into a pogo stick. Its biggest
Automotive lead acid battery market is set to surpass a valuation of US$ 41.8 Bn and is poised to grow at a value CAGR of 5% during the forecast period (2019-2029). The surge in production of automobiles globally has supplemented the growth of lead acid battery market. Lead acid batteries are soaring on popularity as they provide an additional source of power to the vehicle. However, in the current scenario, the global automobile market has been stagnant in terms of profitable growth. This is anticipated to change in the coming years as the automotive sector is set to capture growth opportunities owing to the increasing vehicle production, thus aiding the demand for automotive lead acid batteries. Moreover, the heightened uptake of passenger cars globally, is expected to accelerate the growth of automotive lead acid battery market. Further, a steady rise in the use of pure electric and hybrid vehicles is fueling demand for enhanced flooded batteries which function as auxiliary batteries for starting, lighting, and ignition (SLI). The newest report by Fact.MR estimates that the enhanced flooded batteries will account for ~34% of the total global value share by the end of forecast period.
Key Takeaways of Automotive Lead Acid Battery Market
Flooded batteries are estimated to create an absolute $ opportunity of US$ ~4.9 Bn accounting for nearly 39% of the total share during the forecast period. Owing to the extensive use of cost-effective energy storage batteries in emerging countries, flooded battery segment is projected to expand 1.4X as compared to 2019
Asia-Pacific will remain the prominent region across the forecast period, accounting for more than 45% share in the automotive lead acid battery market.
The Internal Combustion Engine (ICE) technology segment is expected to create an absolute $ opportunity of US$ ~15.1 Bn during the forecast period owing to the continuous adoption of conventional vehicles over electric vehicles due to lack of charging infrastructure in developing economies.
In terms of value, the enhanced flooded battery type segment is expected to grow 2.2X over the forecast period
“Research and development initiatives for sustainable technologies and high performance at low costs is expected to provide new growth prospects in the automotive lead acid battery market” says the Fact.MR analyst
Partnerships to Remain Key Forte of Competitors
The report reveals some of the key players, including EnerSys Inc., Johnson Controls Inc., GS Yuasa Corporation, Panasonic Corporation, Leoch International Technology Limited, Exide Industries Ltd., East Penn Manufacturing Company, Exide Technologies Inc., CSB Battery Company Limited, NorthStar, FIAMM S.p.A., and others. Prominent manufacturers are focusing on building partnerships to strengthen their global presence. For instance,
In 2019, Exide Industry partnered with JCB’s Electric Teletrucks. With this partnership Exide will provide nuanced battery solutions to JCB
In 2018, NorthStar teamed up with Daimler to create the world’s first ultra-high performance pure lead AGM battery
Find More Valuable Insights on Automotive Lead Acid Battery Market
Fact.MR, in its new offering, brings to fore an unbiased analysis of the global automotive lead acid battery market, presenting
GÖTEBORG, Sweden, April 21, 2020 /PRNewswire/ — Sharing the Green Deal vision of sustainable transport and a carbon neutral Europe by 2050, two leading companies in the commercial vehicle industry, Daimler Truck AG and the Volvo Group, have signed a preliminary non-binding agreement to establish a new joint venture. The intention is to develop, produce and commercialize fuel cell systems for heavy-duty vehicle applications and other use cases. Daimler will consolidate all its current fuel cell activities in the joint venture. The Volvo Group will acquire 50% in the joint venture for the sum of approximately EUR 0.6 billion on a cash and debt free basis.
“Transport and logistics keep the world moving, and the need for transport will continue to grow. Truly CO2-neutral transport can be accomplished through electric drive trains with energy coming either from batteries or by converting hydrogen on board into electricity. For trucks to cope with heavy loads and long distances, fuel cells are one important answer and a technology where Daimler has built up significant expertise through its Mercedes-Benz fuel cell unit over the last two decades. This joint initiative with the Volvo Group is a milestone in bringing fuel cell powered trucks and buses onto our roads,” says Martin Daum, Chairman of the Board of Management Daimler Truck AG and Member of the Board of Management of Daimler AG.
“Electrification of road transport is a key element in delivering the so called Green Deal, a carbon neutral Europe and ultimately a carbon neutral world. Using hydrogen as a carrier of green electricity to power electric trucks in long-haul operations is one important part of the puzzle, and a complement to battery electric vehicles and renewable fuels. Combining the Volvo Group and Daimler’s experience in this area to accelerate the rate of development is good both for our customers and for society as a whole. By forming this joint venture, we are clearly showing that we believe in hydrogen fuel cells for commercial vehicles. But for this vision to become reality, other companies and institutions also need to support and contribute to this development, not least in order to establish the fuel infrastructure needed,” says Martin Lundstedt, Volvo Group President and CEO.
The Volvo Group and Daimler Truck AG will be 50/50 partners in the joint venture, which will operate as an independent and autonomous entity, with Daimler Truck AG and the Volvo Group continuing to be competitors in all other areas of business. Joining forces will decrease development costs for both companies and accelerate the market introduction of fuel cell systems in products used for heavy-duty transport and demanding long-haul applications. In the context of the current economic downturn cooperation has become even more necessary in order to meet the Green Deal objectives within a feasible time-frame.
The common goal is for both companies to offer heavy-duty vehicles with fuel cells for demanding long-haul applications in series production in the second half of the decade. In addition, other automotive and
India’s auto industry had to scale down operations March 23 onwards
Mayhem broke out last month after the sudden spike in Coronavirus cases in our country to control which the entire nation had to go under a lockdown starting March 24. Production started taking a hit almost a week before the lockdown when we started hearing about automakers scaling down operations and were completely stopped on the day of Janata Curfew on March 22. This took quite a toll on the production numbers for March 2020. While the overall industry witnessed a decline of 33.61 per cent at 14,47,345 units as compared to 21,80,203 units manufactured a year ago, production of passenger vehicles (PVs) slumped by 38.14 per cent 2,07,196 units as compared to 3,34,948 units assembled in the same month last year.
Also Read: Passenger Vehicle Sales Down By 51 Per Cent In March 2020
(Car manufacturers started scaling down on production process almost a week before lockdown was delcared)
Production of passenger cars went down by 43.84 per cent at 1,22,037 units against 2,17,292 units which were manufactured a year ago. In the same months, the utility vehicle (UV) segment recorded a decline of 19.24 per cent at 78,334 units as compared to 96,997 units. Production of vans too witnessed a heavy drop of 66.96 per cent at 6825 units as compared to 20,659 units. Production of commercial vehicles (CVs) went down by a whopping 82.88 per cent at 18,057 units as compared to 1,05,475 units. Production of two-wheelers too went down by 28.21 per cent at 11,61,826 units against 16,18,406 units while production of three-wheelers went down by 50.39 per cent at 59,813 units as compared to 1,20,578 units. The quadricycle segment too witnessed a decline of 43.09 per cent at 453 units as compared to 796 units.
Also Read: Coronavirus Lockdown: Indian Automobile Sector May Start Operations Soon
Auto sales also remained subdued in March 2020.
With all dealerships remaining closed across the nation during the lockdown, sales have also remained subdued in March. Auto sales overall went down by 44.95 per cent in March 2020 selling 10,50,367 units last month as compared to 19,08,097 units which were sold in the same month a year ago. Sales of passenger vehicles went down by 51 per cent in March 2020 selling 143,861 units as compared to 2,91,861 units a year ago.
For the latest auto news and reviews, follow CarandBike on Twitter, Facebook, and subscribe to our YouTube channel.