The war isn’t contained.
The Strait of Hormuz is choked shut and global automakers are bleeding cash because of it. Toyota is the latest casualty, telling its suppliers it needs to chop roughly 83,000 units from its overseas output schedule. From now until November. That is a lot of metal left on the line.
The word hit the supply base midweek. Blame it on fuel costs spiking. Blame it on demand in the Middle East evaporating. Both are true. And the model taking the hardest hit?
The Toyota RAV4.
It isn’t alone, obviously. The cuts slash across the Innovative International Multi-purpose Vehicle lineup too. You know these trucks. The Hilux. The Fortuner. Even the new Land Cruiser FJ takes a hit. So do the Probox and Corolla Touring models.
Toyota moved fast internally before making this public. In Japan, they already dented production by 40.000 vehicles meant for Middle East delivery during March and April. Then came the stoppages. The Tsutsumi plant in Aichi sat quiet on one assembly line for two days this month. Gifu Auto Body paused a line for a full day.
Toyota normally ships half a million to 600.000 cars to the region each year. Takanori Azuma says nearly half that volume is now in jeopardy.
So here we are. Profits are tanking.
Last month, the company predicted it would still hit the 10 million unit mark for the combined Toyota and Lexus brands. A modest 1% jump. But the bottom line is bleeding out. Consolidated net profit is forecast to drop 22% to 3 trillion yen. Or about $18.8 billion if the exchange rates hold steady.
The warning label is clear. If the Middle East keeps burning and oil stays expensive. Things will get worse. Not better.
Will they adapt fast enough.
History says manufacturers can bend but rarely break completely. Still. Watching the RAV4 get axed as collateral damage in a geopolitical dispute feels wrong. Almost absurd. We wanted cheap reliable crossovers. We got geopolitical uncertainty instead.
