Although several national media report Toyota plans to reduce vehicle production in North America through October, Susan Elkington, president of Toyota Motor Manufacturing Kentucky, plans a more “wait-and-see” attitude.

Reuters reported last week Toyota plans to produce 29 percent fewer vehicles of all types from April through October than were produced during the same period last year. 

Before the pandemic struck the U.S. in March Toyota had plans to actually increase production in its North America plants.

“Sales were down 55 percent in April,” Elkington said. “That’s a large number, but it is actually a lot less than we anticipated. And the end of April was better than the start of April.

“We’ll have to see what happens. We’ll slowly pick up production, but I believe fall will be good for us.”

Despite the shutdown of all plants in North America, inventory on dealer lots should be fine once demand picks up.

“We haven’t had production for seven weeks, so there has been time to adjust the inventory,” Elkington said.

A factor that may influence production is the supply chain, she added.

“This (pandemic) has had an impact throughout the world,” she said. “We have a global supply chain, and the longer this goes the deeper and deeper it impacts our supply chain.”

TMMK reopened May 11, and has spent much of the first week going through safety protocols established because of the coronavirus. Then production will ramp up slowly as the economy begins to reopen. 

In its report Reuters quoted an unnamed Toyota executive that the carmaker planned to produce only about 10 percent as many vehicles in May as originally planned. That same Toyota executive predicted September production could surpass last year’s levels, as the carmaker begins catching up to its lost output.

This year, TMMK began manufacturing the RAV-4 SUV, and J.D. Power reports demand for that vehicle has remained strong despite the pandemic.  

However, when Toyota Motor Company released its quarterly financial statements, the automaker warned global car sales may not return to pre-virus levels before next year. 

The car market is expected to hit bottom this quarter, but the recovery may be slow due to the lingering impact of COVID-19, Toyota said in its release.

 

Mike Scogin can be reached at mscogin@news-graphic.com. 

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