Supply chain issues plague every automaker, and with the announcement that Toyota is cutting their 2022 new car sales outlook, things look bleak.
Bob Carter, executive vice president of sales for Toyota Motor North America, said the new outlook of 15.5 million vehicles was down from its previous forecast of 16.5 million. It’s not that demand is dropping, it’s simply that the constraints of supply issues continue to upset the apple cart. Reuters reported that, in a conference call with Carter, he stated that “The supply-chain challenges that we’re seeing … will remain with us for a while.”
Toyota already cut global sales by 150,000 in April.
Raw material shortages, semiconductor chips, pandemic and now the logistical nightmare of Russia’s invasion of Ukraine all contributed to the supply conundrum. According to Carter, Toyota expects U.S. sales to finish at about 2.35 million vehicles for 2022 – that’s both Toyota and Lexus.
“That is an adjustment that quite frankly is not based on consumer demand. It’s based solely on what our projections of the supply environment is going to be.”
Bob Carter, Executive Vice President of Sales for Toyota Motor North America
You can read about Toyota’s sales success with the new Tundra pickup truck (here).
Many consumers are concerned that the additional costs of materials will be passed on to the buyer. Carter does not think that the affordability of Toyota products will jump significantly this year. He predicts that it may take around six months for inventory rates to calm as the supply chain normalizes.
Carter expects some of the higher raw material costs to be passed on to consumers; he doesn’t see vehicle affordability being an issue this year. He said it will take six months for inventory rates to normalize after the supply chain recovers.
According to Carter, as of right now: “The vehicles are being sold literally before they are built.”
