Toyota Motor Corp will delay resuming operations in Thailand for 10 days, starting up Nov 21, says Akio Toyoda, president of Toyota.
“We will try to start production as soon as possible, possibly on the 21st of this month, and then slowly increase our production capacity,” said Mr Toyoda.
Though floods have not hit Toyota’s three Thai plants in Samut Prakan and Chachoengsao, parts shortages have limited its operations. The company has delayed restarting operation three times.
Mr Toyoda said the company is studying what its overall production capacity for this year will be.
“Toyota expects to increase our investment here over time to develop the automotive industry,” he said, adding the company aims to be the global industry leader.
A Toyota executive said some parts makers confirmed their readiness to resume supply to Toyota, making this restart schedule more likely.
Japan, Thailand’s biggest foreign investor, may also be the largest overseas economic victim of record floods forcing companies including Toyota, Hitachi and Canon to halt output in the country.
Toyota also scrapped its profit forecast as the floods are ongoing and it needs more time to assess the financial toll. It previously projected earnings of 390 billion yen this year.
Some analysts cut that estimate in half if the floods hamper production for three months.
Toyota was already producing at full capacity to recover from the impact of the March earthquake in Japan, so there is a limit to what it can do to recover from flood losses, he said.
The floods may also push back expansion plans at Toyota and Honda until the first quarter of 2012.
However, Japanese manufacturers may have more difficulty shifting output away from Thailand, where they have more concentrated supply chains than US and European rivals including Ford Motor Co.
Japanese companies make up 57% of the foreign projects granted investment incentives last year by Thailand’s Board of Investment, the most by a large margin. Besides the March earthquake and tsunami in Japan, its exporters are also reeling from the yen’s rise to a post-WWII high on Oct 31.
Isuzu Motors extended its halt on operations in Thailand to tomorrow because of the parts shortage, even though its factories are not flooded. Production will be cut by 25,000 units over the last 30 days.
Source: Bangkok Post