Japanese Automakers Cutting Output amid Chip Shortages

Tokyo, Jan. 28 (Jiji Press)--Japanese automakers are increasingly reducing their output after delays in their procurement of semiconductor chips became evident in early January. Global semiconductor shortages are a blow to the automakers, which saw their output recover at a relatively early date from the fallout from the novel coronavirus pandemic. The Japanese government has asked Taiwanese semiconductor makers to boost shipments to Japan. But it is likely to take several months for Japanese automakers to receive sufficient supplies. "The impact is not small," a senior official at a major automaker said. Semiconductor demand grew in line with a surge in sales of personal computers and game consoles amid the pandemic. By contrast, automobile output plunged in the first half of 2020. This promoted a shift in semiconductor supply from automobiles to other products, leaving chip procurement by automakers difficult, industry officials said. Nissan Motor Co. <7201> and Honda Motor Co. <7267> are cutting domestic compact car production by several thousand units per month each. Toyota Motor Corp. <7203> is reducing production in the United States and France. The company is investigating the financial impact of the move, a public relations official said. A Rohm Co. <6963> official said "its semiconductor plants have been running at high utilization rates since last autumn." Renesas Electronics Corp. <6723> is manufacturing chips for automakers at its plant in Hitachinaka, Ibaraki Prefecture, eastern Japan, on behalf of an Asahi Kasei Corp. <3407> unit, which has suspended production due to a fire. Still, supply shortages continue, prompting Renesas and Toshiba Corp. <6502> to propose raising prices for their semiconductors. On Tuesday, industry minister Hiroshi Kajiyama said that the government is calling on Taiwanese semiconductor makers including Taiwan Semiconductor Manufacturing Co. to boost production. Even after the current shortages are eliminated, semiconductor demand is expected to increase further in line with accelerated technological development. "Automakers may need to review the way in which they develop production plans and order parts," a senior industry ministry official said. END