• Jiji


Persistent shortages of semiconductors and other auto parts are casting a shadow over the earnings outlook of major Japanese automakers.

As it remains uncertain when automakers will be able to procure semiconductors and other parts smoothly, they may be forced to make further production cuts and rethink their scenarios for sales recovery from the impact of the coronavirus pandemic, industry sources said.

For the year through March 2022, Honda Motor Co. said on Friday that it has downgraded its sales estimate to ¥14.6 trillion from ¥15.45 trillion and the net profit forecast to ¥555 billion from ¥670 billion.

Honda also reduced its full-year vehicle sales estimate to 4.2 million units from 4.85 million units, against the initial projection of 5 million units.

“It could be difficult to catch up by the end of the current year,” Honda Executive Vice President said.

On Thursday, Toyota Motor Corp. lowered its global vehicle sales projection for fiscal 2021 by 260,000 units to 10.29 million units, following such a downward revision in September.

Due to delays in parts procurement caused by the spread of the coronavirus in Southeast Asia, Toyota was forced to slash auto production by over 700,000 units in September and October alone.

While the company expects the situation to improve from November, Chief Financial Officer Kenta Kon sounded cautious at a news conference, saying, “There still are risks.”

Toyota aims to increase profits by improving cost management. However, materials prices are rising around the world, and it has had to accept an increase in its purchase prices for steel materials in negotiations with Nippon Steel Corp..

It is unclear whether Toyota will be able to achieve a profit boost as planned, partly because the administration of Prime Minister Fumio Kishida is eager to strengthen the supervision of business deals involving subcontractors.

Also on Thursday, Mitsubishi Motors Corp. revealed that the company has expanded its estimate for production cuts linked to semiconductor shortages in fiscal 2021 to 95,000 units from 40,000 units.

Major automakers initially anticipated that production cuts brought on by semiconductor shortages would be resolved by the second half of the current fiscal year.

However, the COVID-19 crisis in Southeast Asia appears far more serious than automakers had expected. “A further production cut is inevitable,” a senior official at a major automaker said.

The automakers are still in the dark about when their parts procurement woes will be resolved and when production will get back on the recovery track.

In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.