Robert Piehl
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Explosion at Steel Factory Halts Japanese Toyota Production

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Aichi Steel explosion halts Toyota production

An explosion at Aichi Steel Production has forced Toyota to halt production at all Japanese plants for a week

Toyota announced yesterday that it will be halting production at all factories in Japan for an entire week, due to a steel shortage in the country. Production will halt on February 8th and will not pick back up again until the 15th, meaning Toyota will lose six actual work days.

It doesn’t come as a huge shock that Toyota is finally halting its production, as one of its key steel suppliers, Aichi Steel Production, has halted its own production following an explosion at the plant on January 8th. Production won’t resume at Aichi until late March.

Because of the steel plant’s downtime, Toyota is fast approaching a situation wherein it does not have the amount of steel necessary to make vital components of its vehicles. Toyota execs hope that halting production for an entire week, while detrimental to production volume, will keep the company from running into problems in the weeks ahead.

A week may not sound like a long time for production to be paused, but the auto giant’s Japanese factories reportedly produced 13,600 models a day in December 2015. At that rate, that automaker will be missing out on 81,600 vehicles in a six-day period.

While a shortage of vehicles that large will certainly affect Japanese dealerships, dealers in the US will likely feel the heat too. More than half of all vehicles produced at Japanese assembly plants are actually exported to markets such as the United States. Most notable is the all-new 2016 Toyota Prius, which customers will be eager to snag off dealership lots.

Robert Piehl is the General Manager of Carver Toyota in Taylorsville, IN, which serves the greater Indianapolis areas including Columbus, Bloomington, Greenwood, Franklin, Seymour, and Brownstown.