Honda Motor Co. has come up with a surprising update about cutting its production in Japanese plants. The company announced on Thursday it will curtail car production at two Japanese plants by 40 percent for the rest of September as a result of ongoing supply chain and logistics challenges.
Reduction On Honda Motor Plants:
The reduction can taken as a hint that automakers won’t be able to increase production levels in the second half of the fiscal year to the end of March to make up due to a dent brought on by a persistent chronic chip shortage and supply chain disruptions in the first half of the fiscal year.
In September, Honda Japan’s Saitama assembly plant north of Tokyo will drop output by around 40%, and two lines of its Suzuka plant’s production in western Japan will drop output by about 20%. Moreover, the automaker announced that for the remainder of the month, output at the Saitama facility and the Suzuka factory would reduced by around 10% and 30%, respectively.
Reason For This Production Reduced:
According to the media resources, the company CEO has pointed to COVID-19 outbreaks and a lack of semiconductors as the reasons for operational problems. Several vehicles will be affected by the production cuts, including the Vezel sports utility vehicle, the Stepwgn minivan, and the Civic compact car. Honda Japan changed its production schedule in May but had intended to resume normal operations in early June.
Toyota Motor Corp (7203.T), a competitor of Honda, maintained its confidence in its production strategy, maintaining its record 9.7 million global vehicle production target for the current fiscal year ending in March 2023 and claiming that the production and sales outlook would improve from August onward. This month, Toyota said it expected to produce about 850,000 vehicles globally in September and planned to ramp up production through November, subject to manpower and parts availability.
