BUSINESS

Toyota To Resume Full Production By November, President Says

06/04/2011 10:38 am ET | Updated Aug 04, 2011

(Reuters) - The president of Toyota Motors (7203.T) said on Saturday he expects the automaker to resume full production globally in November and its Japanese output is expected this month to recover to 90 percent of levels seen before a March earthquake.

"We are restoring (production) at fast speeds despite ongoing aftershocks," Akio Toyoda, the grandson of the company's founder, told reporters during a visit to South Korea.

"We expect our output to recover to normal from November ... For Japan's domestic production, we expect to resume 90 percent of our normal output this month," he said.

Toyota and its local rivals have been plagued by shortages of hundreds of components after a magnitude 9.0 earthquake and tsunami on March 11 damaged factories in Japan's northeast.

Production at Toyota is returning to pre-quake levels faster than the company anticipated, with output in June likely to reach90 percent of pre-quake levels, a company spokesman confirmed on Wednesday.

That more optimistic outlook compares with a prediction last month for production to return to 70 percent of normal.

The president said in April that a complete recovery was expected in November or December.

Still, in 2011 overall production may be almost a million vehicles less than Toyota had planned to build at the beginning of the year. Lost output by the end of May was 900,000 cars.

Because Toyota builds 38 percent of its cars in Japan compared with a smaller 25 percent at Nissan Motor Co Ltd (7201.T) and Honda Motor Co Ltd (7267.T) the impact at Japan's biggest auto company has been greater.

The president visited South Korea, a small market for the auto giant, to "encourage dealers," a Toyota Korea representative said, at a time when the automaker is suffering from sales slump in the wake of the quake and a recall crisis.

Toyota's Lexus sales dived 51 percent in April in South Korea from a year ago, while other Toyota vehicle sales slid 41 percent, even as the imported vehicle market grew 14 percent led by vehicles from German carmakers, according to data by Korea Automobile Importers and Distributors Association.

Last year, Toyota sold a combined 10,486 Lexus and other models in the South Korean market dominated by Hyundai Motor (005380.KS) and Kia Motors (000270.KS).

A shortage of parts resulting from disrupted supply chains means it has lost ground in overseas markets. On June 2, Toyota said it sold only 38,500 cars in China during May, 35 percent less than a year ago.

In the United States, its main foreign market, sales in May slumped 28 percent.

In contrast, South Korean rivals Hyundai Motor and Kia Motors posted double-digit sales growth and a record-high combined market share last month in the key market, putting their combined U.S. sales almost on par with that of Toyota.

(Additional reporting by Tim Kelly in TOKYO; Editing by Robert Birsel)

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