Toyota South Africa Motors says the COVID-19 lockdown has so far cost its Prospecton plant nearly 13 500 production units.
Speaking to journalists during a virtual roundtable attended by CARmag.co.za, Andrew Kirby, president and CEO of Toyota South Africa Motors, said the factory had closed its doors late in March when the country went into lockdown.
“We have so far lost production of just under 13 500 units. Of course, we don’t know exactly when start-up will take place or at what pace,” Kirby said. “We are looking at a number of scenarios, the most probable being a staggered start [to production].”
The Japanese firm’s local arm builds the Hilux, Fortuner, Corolla Quest and Hiace (as well as assembles certain Hino models) at its factory in the south of Durban, KwaZulu-Natal.
“It’s difficult to put a price on it but it’s not just the value of the lost production or the lost sales but also the fact that our workforce has been idle for the last few weeks.”
Kirby confirmed Toyota SA Motors’ employees were receiving full pay under the lockdown. He said the company didn’t envisage any job losses but warned that smaller businesses in the firm’s supply chain might not be able to weather the storm.
“We have 7 251 employees and to instil some security and show business continuity we have secured full pay for all of our staff during this lockdown period,” he confirmed.
Kirby said while Toyota SA had initially planned to build between 135 000 and 150 000 units (for local and export markets) at Prospecton in 2020, it now expected a 15 to 20 percent drop in its annual production figure.
“Of course, we recognise that we’ve lost the whole month of April and a little bit at the end of March and that we’re [expecting] somewhere between a 40 and 50 percent drop in demand in May, and that’d obviously decrease in June and July.
“We’ve got three demand sectors: the one being the South African market; the other being Europe as our largest export destination; and then the third being Africa.
“Broadly speaking, we’ve seen about a 15 percent cut in our European export orders. For Africa, the cut is a little bit less at around 10 percent but we think that will go up to between 15 and 20 percent. And [it’s] a similar range in South Africa.”
Kirby said he expected exports to pick up as soon as the lockdown was lifted.