TOYOTA GOING TO CUTS INDIA OUTPUT

The India unit of Toyota Motor Corp. has cut production of two key vehicle models in December due to lower availability of auto parts from Thailand, where severe floods forced auto makers and suppliers to shut factories.

Toyota Kirloskar Motor Pvt. Ltd. expects to make 10% to 15% fewer units of the Innova multi-purpose vehicle and Fortuner sport-utility vehicle in December, Sandeep Singh, deputy managing director for marketing, said Friday.

A spokeswoman for Ford Motor Co.'s India unit said while the auto maker hasn't yet been affected by flooding in Thailand, it continues to assess the situation. She didn't disclose the parts the company imports from Thailand.

Toyota joins Honda Motor Co. that has suspended production of its Brio hatchback in India this month due to a shortage of Thailand-made parts. Production of Honda's Jazz hatchback and City sedan has also been hit, its local unit said Wednesday.

The production constraints have hit the local units of Toyota and Honda barely months after both resumed normal output, which was impacted since March due to an earthquake and tsunami in Japan.

Lower output at Honda and Toyota will likely hit their sales in India. Honda is gaining from a cheaper variant of its Jazz hatchback and the new Brio, while higher sales of the Fortuner and Innova has prompted Toyota to raise output of both models.

"We are buying parts from alternate sources in Indonesia and the Philippines to minimise the impact on our operations," Mr. Singh said.

He said the floods in Thailand have forced the company to defer raising production of the Innova and Fortuner models by a month to January. The company had earlier planned to boost annual production of the two models to 90,000 units a year from 80,000 now.

Source - wsj