Toyota grinds to a halt in Japan after system failure

Toyota Motor Corp. suspended operations at all 14 of its assembly plants in Japan after a production system malfunction, bringing domestic output to a standstill at the world’s biggest-selling automaker.

The glitch means Toyota is unable to order components and the cause is under investigation, though it is "likely not due to a cyberattack", a spokesperson said.

Toyota suspended 12 plants in its home market on Tuesday morning and added the remaining two in the afternoon, the spokesperson said. It was not immediately clear how much output would be lost.

The plants account for about a third of the automaker’s global production, based on Reuters calculations.

Toyota’s domestic production had been on the rebound after a series of cuts it blamed on semiconductor shortage. Output was up 29% in the six months to end-June, the first increase in two years.

Domestic output averaged about 13,500 vehicles daily in the first half of the year, Reuters calculations show. That excludes vehicles from group automakers Daihatsu and Hino.

Operations were halted for a day last year when a supplier suffered a cyberattack, hampering Toyota’s ability to order parts. The company resumed operations using a back-up network.

Tuesday’s incident is having a knock-on effect. Group firm Toyota Industries said it has partially suspended operations at two engine plants as a result of the glitch.

Toyota is a pioneer of just-in-time inventory management, which keeps down costs but means supply chain problems can put production at risk.

While the cause of the latest malfunction is unclear, corporate Japan has been on alert in recent days as businesses and government offices reported harassing phone calls.

The government said the calls were probably from China and related to Japan’s release of treated radioactive water from the wrecked Fukushima nuclear power plant into the Pacific Ocean.

Toyota shares were up 0.12% at 2,439 yen in afternoon trade after spending much of the morning in negative territory.

Reuters