Technical Glitch Suspends Toyota's Japan Operations Until Wednesday

YUICHI YAMAZAKI/AFP via Getty Images

Toyota Motor Corporation (TM), slipped down 0.5% in early trading on Tuesday morning as it suspended operations across all 14 of its plants in Japan owing to a glitch in its production system.

The 14 factories experienced a glitch that halted production and are expected to be back online by Wednesday. The plants in Toyota’s home country account for as much as a third of global production. While the cause is under investigation, the Japanese auto giant does not suspect it to be a cyberattack.

The system malfunction prevented the company from ordering components, but the impact on output is unclear. In a domino effect, group firm Toyota Industries has also partially suspended operations at two engine plants.

The just-in-time production method, which requires components to be delivered just when they are needed, was pioneered by Toyota to reduce inventory costs. A disruption in its supply chain means the company does not have spare parts to continue production until the malfunction is resolved.

Last year, a cyberattack on one of Toyota's suppliers led to a system failure, forcing the auto company to suspend operations for a day. The disruption caused an output loss of roughly 13,000 cars. Toyota also had to temporarily halt production at some plants owing to a coronavirus lockdown in China's economic hub, Shanghai, in 2022.

Reuters. "Toyota's Japan production at standstill as system failure hits assembly plants."

CNN. "Toyota suspends production at its Japanese plants after supply chain glitch."

BBC. "Toyota halts all Japan assembly plants due to glitch."