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Article

3 Mar 2022

Author:
Kosei Fukao, Nikkei Asia

Japan: Toyota to stop Russia auto production as sanctions cut supply chain

"Toyota to halt Russia production Friday as sanctions cut supply chain" 3 March 2022

Toyota Motor will suspend auto production in Russia from Friday as it struggles to source parts from overseas amid sanctions against the country.

Toyota has also halted vehicle exports to Russia, citing supply chain disruptions, the world's top-selling automaker said Wednesday.

The statement confirmed an earlier Nikkei report.

"As a company with operations in Ukraine and Russia, our priority in dealing with this crisis is to ensure the safety of all our team members, retailer staff, and supply chain partners," Toyota said. "We are also monitoring global developments and will make necessary decisions as required."

Toyota, the leader in Russia's auto market, made about 80,000 vehicles last year at its St. Petersburg plant in western Russia, including the RAV4 sport utility vehicle and the Camry sedan. Its production operations there rely on about 40% imported components.

Vehicle sales will continue until inventories run out. Toyota will continue to provide maintenance and other services in Russia.

Toyota's move comes as a growing number of companies have begun shunning Russia in the wake of its invasion of Ukraine.

[...]

These decisions reflect not only concern about reputational risk and the possibility of violating sanctions, but also the increasing difficulty of continuing business as usual as supply chain links are severed. Major maritime shippers including AP Moller Maersk and MSC have largely halted bookings to and from Russia.

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