According to the Nikkei, due to the prolonged closure of the Strait of Hormuz amid the Iran situation and sluggish market demand, Toyota Motor Corporation plans to cut production outside Japan by approximately 100,000 vehicles by around February 2027. It is reported that Toyota has notified major parts suppliers of the revised production plan.
As U.S. and Israeli strikes on Iran prevent oil tankers from passing through the key waterway, fuel prices have surged, affecting market demand in China, the Middle East, and other regions.
In March and April, Toyota had already cut production of vehicles destined for the Middle East from its domestic Japanese plants by about 40,000 units. Previously, the company also planned to reduce overseas production by approximately 83,000 units between June and November.
In the Chinese market, demand for Toyota vehicles continues to decline due to rising fuel costs. As a result, production of gasoline-powered models such as the Toyota RAV4 sport utility vehicle and the Avalon sedan has been reduced.
Toyota will also cut production of electric vehicles in China, including the bZ3X EV, the bZ7, and the Camry sedan.
However, in the Japanese market, Toyota plans to increase production by 4,200 units in the second half of the year (compared to the original plan set in May). While production of the Lexus ES sedan for the Chinese market will be reduced due to low local demand, output of the RAV4 and the Land Cruiser 250 SUV will increase.
Toyota previously planned to produce approximately 10 million Toyota and Lexus brand vehicles in the fiscal year ending March 2027, a 1% increase year-on-year. The company expects consolidated net profit for the same period to be 3 trillion yen (approximately $18.6 billion), down 22% year-on-year.
