Toyota Will Lift Production as Rivals Lag

Toyota has announced it will increase production for July through September to 850,000. It said it would do so despite an ongoing microchip shortage. It hedged its comments a bit: “As it remains difficult to look ahead due to the shortage of semiconductors and the spread of COVID-19, there is a possibility that the production plan may be lower.”

The disclosure must come as a shock to the industry. Almost every other car company has said it cannot ramp up production. Supply chain shortages are too brutal.

How can Toyota swim against the tide? It would not say. It has been considered a master of sourcing parts for decades. However, it did not point to that skill. Demand for cars has been high across most of the world. But that means there are buyers, not that there is inventory.

If there is a competitive advantage in the car industry today, it is not product or even price. It is the ability to get cars onto lots. Toyota seems to be alone when it comes to the edge.

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