Toyota foresees summer supply shortage

Toyota Motor Corp. is telling U.S. dealers that new vehicles could be in short supply this summer because of production slowdowns in Japan and North America.

In a memo to dealers obtained Monday by The Associated Press, Toyota's U.S. general manager Bob Carter said Toyota is producing cars and trucks at significantly reduced levels in April and hasn't set its production schedule for May through July.

"The potential exists that supply of new vehicles could be significantly impacted this summer," Carter said in the memo.

Production has been hampered by parts shortages after hundreds of suppliers were damaged by the March 11 earthquake and tsunami in Japan. Even paint colors have been affected. Carter said in the memo that the company is changing exterior colors on some vehicles because of shortages of a chemical produced by a supplier.

Toyota's North American plants are facing a series of one-day shutdowns starting this Friday because of parts shortages. All 13 of its plants will have some downtime, though the duration may vary at a few. For most, the one-day shutdowns will happen between April 15 and April 25. The temporary shutdowns will affect 25,000 workers, but there will be no layoffs, the company said.

Among the vehicles Toyota makes at its U.S. and Canadian plants are the Camry and Corolla sedans, the Tundra pickup and the Sienna minivan.

In Japan, Toyota plans to resume production at all its factories from April 18 through April 27, but only at half their normal volume. The Japanese plants will then shut down through May 10 for an annual holiday break. The Prius hybrid and Yaris subcompact are among the cars the company makes in Japan.

Carter said Toyota now has 300,000 vehicles available in the U.S. Considering that Toyota sold 176,222 cars and trucks in March, the current stockpile means the company has a little less than two months' supply.

"In summary, what we know is, today we have good levels of inventory, but inventory will be getting tighter," Carter said. Toyota's U.S. sales are off to a strong start in April, he said.

Earl Stewart, who owns a Toyota dealership in North Palm Beach, Fla., sold 88 Prius hybrids last month but now has none in stock. He hopes to find out this week how many more he'll get.

"I'm sure it isn't going to be nearly as many as we could sell," he said. Stewart said he has continued taking orders from customers and hopes to fill them in the next few months.

Carter said Toyota will be shipping vehicles to North America every two weeks and will stop at six or more ports per voyage. He said he will let dealers know how many vehicles will be coming to each port as soon as he receives each ship's manifest.

The contents of the memo were first reported by the Wall Street Journal.

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