The global semiconductor chip shortage has impacted automakers worldwide, including Toyota. With chip supplies limited, Toyota has been forced to cut production of various models. Understanding which Toyota vehicles have been affected by the chip shortage can help consumers make informed purchasing decisions in the current market.
How has the chip shortage impacted Toyota?
Toyota has not been immune to the chip shortage that has plagued the auto industry. The company has repeatedly needed to adjust production plans and shut down manufacturing plants due to limited chip supplies. Here is a brief overview of how Toyota has been impacted:
- In January 2021, Toyota needed to cut production by 40% in Japan and 30% in the US due to chip shortages.
- In August 2021, Toyota suspended production at 14 plants worldwide and cut September production by 40% due to Covid-related supply chain issues.
- In September 2021, Toyota announced it would cut global production for October by 15% due to the chip shortage.
- Between April and June 2022, Toyota’s operating profit fell over 18% as chip shortages continued to impact production capabilities.
Overall, Toyota has lost an estimated 1.5 million units of production globally due to chip shortages since early 2021. The company continues to face uncertainty regarding semiconductor supplies, leading to fluctuating production levels.
Which Toyota models have been most affected?
While the chip shortage has impacted Toyota’s operations broadly, some models have seen more extensive production cuts than others. Here are the Toyota vehicles that have been most affected by chip shortages so far:
Toyota Tundra
The Toyota Tundra full-size pickup truck has faced significant production cuts stemming from chip shortages. Examples include:
- In November 2021, Toyota idled the San Antonio, Texas Tundra plant for 3 weeks due to parts shortages.
- In December 2021, Toyota cut Tundra production by 40% for the month.
- In January 2022, Tundra production was cut in half for the month.
Toyota Tacoma
The midsize Toyota Tacoma pickup has also been heavily impacted by chip-related parts shortages. For example:
- In January 2022, Toyota idled Tacoma production at the Baja California, Mexico plant for 2 weeks.
- In March 2022, Toyota suspended Tacoma production at the Guanajuato, Mexico plant for about 2 weeks.
- From January to March 2022, Toyota’s Tacoma production fell by about 40% compared to 2021 levels.
Toyota Tundra and Tacoma
In April 2022, Toyota halted production of both the Tundra and Tacoma at all North American plants for at least 2 weeks due to semiconductor and parts shortages.
Toyota RAV4
The popular RAV4 compact SUV has also faced supply chain-related production cuts:
- In August 2021, Toyota reduced RAV4 production by 40% at the Ontario, Canada plant due to chip shortages.
- In September 2021, Toyota suspended production of the RAV4 for 2 weeks at the Kentucky plant due to parts shortages.
- In October 2021, Toyota cut RAV4 production in half at the Ontario plant, with shortages expected to continue.
Other Toyota models impacted
While the Tundra, Tacoma, and RAV4 have seen the most extensive chip shortage-related production cuts, other Toyota models have also been affected to varying degrees:
- Camry – Production slowed in August 2021 and was suspended for 2 days in October 2021.
- Highlander – Faced a 20% production cut in September 2021.
- Corolla – Saw reduced production levels in mid to late 2021.
- Sequoia – Production was idled for 2 weeks in December 2021.
- SIenna – Production suspended for 2 weeks in August 2021.
Overall, Toyota’s pickup trucks, SUVs and North American-built models have been the most heavily impacted by chip-induced parts shortages so far. However, the majority of Toyota models have seen at least some level of production disruption.
What Toyota models have been least affected?
While no Toyota models have been completely immune to the chip shortage, some have weathered the issue better than others so far. Toyota models that have seen minimal impact include:
- Prius – Hybrid hatchback production has been relatively stable.
- Corolla Cross – Toyota’s newest crossover SUV has not faced cuts yet.
- GR86 – No significant production impacts for the sports car.
- Mirai – The hydrogen fuel cell vehicle has been mostly unaffected.
Many of Toyota’s cars produced outside North America, such as the Yaris and Corolla, have also avoided major disruptions so far. However, the chip shortage remains an evolving situation, so impacts could spread to additional models going forward.
When will the chip shortage impact end?
Predicting exactly when the chip shortage impact will dissipate is difficult, as the situation remains complex and uncertain. However, based on expert projections, here is an overview of when Toyota chip shortage issues may start to improve:
- Late 2022 – Some analysts expect chip supplies to incrementally improve in late 2022 as new production comes online.
- 2023 – The chip shortage is expected to ease significantly in 2023, allowing automakers to resume normal production.
- 2024 and beyond – Semiconductor supplies are projected to stabilize at healthy levels, eliminating chip shortage impacts by 2024.
However, if unexpected disruptions occur, like new Covid waves, the chip shortage could persist at some level beyond 2023. Toyota and other automakers will likely continue facing at least some degree of parts shortages and production uncertainty in the next 1-2 years.
What is Toyota doing to manage the shortage?
Toyota is employing a range of strategies to manage the chip shortage and limit the impacts on production levels. These include:
- Working closely with suppliers to maximize chip supplies and identify alternative chips or component designs when possible.
- Coordinating with dealers to align vehicle allocation with inventories and consumer demand.
- Adjusting product mixes at plants to prioritize high-demand models.
- Developing new connected capabilities to track chip supplies in real-time.
- Stockpiling key components and chips when available to buffer against future shortages.
Toyota has also announced long-term investments of up to $5.6 billion to shore up chip supplies, including:
- $2.5 billion investment in Toyota Motor Manufacturing in Liberty, Kentucky to produce automotive semiconductors.
- $2.3 billion investment in Toyota Motor Manufacturing Texas to produce chips for North American vehicles.
- $700 million to build a data center and semi-customized silicon chips.
These efforts demonstrate Toyota’s commitment to building more supply chain resiliency against future semiconductor supply shocks.
How are Toyota shortages impacting customers?
For customers looking to purchase new Toyota vehicles, the chip-driven production cuts have led to the following impacts:
- Reduced new vehicle inventory – Dealers have limited stock for impacted models.
- Order delays – Much longer lead times for orders, often many months.
- No special configurations – Most orders are limited to standard configurations.
- Pay MSRP or above – Due to high demand and low inventory, most dealers are not offering discounts.
- Used car price increases – Limited new inventory has led to higher used vehicle prices.
However, analysts expect the chip shortage impact to gradually improve throughout 2022 and into 2023. As supply chain conditions stabilize, new vehicle availability should improve, potentially bringing relief to car shoppers.
Conclusion
The semiconductor chip shortage has dealt a serious blow to Toyota’s operations and production capabilities since early 2021, leading to extensive cutbacks for models like the Tundra, Tacoma and RAV4. While Toyota is investing heavily to shore up future chip supplies, inventory and order delays will likely persist in some capacity through at least 2022. However, the long-term outlook points to a post-2023 future when chip shortages no longer restrain Toyota’s output. With proactive planning and strong partnerships, Toyota hopes to emerge from the chip crisis ready to satisfy surging post-pandemic auto demand.