Toyota Closing Factories in China Due To Protests — How Will This Impact Production and Output?

ImageToyota is the seventh largest company in the world and the second largest automobile manufacturer, with facilities in 27 countries outside of Japan. As of 2006, Toyota had a total employee headcount of 53,004 in the underdeveloped countries. Toyota not only supplies a multitude of jobs to those in underdeveloped and developing countries, but also produces vehicles that are created and sold worldwide.

Toyota has had to shut down factories in China, as anti-Japanese protests have been occurring. As stated by the Financial Times in a recent article: “Toyota and other Japanese manufacturers were easy targets for Chinese rage over Tokyo’s purchase of the Senkaku islands – known as the Diaoyu in China – from their private owner. Attacks on Japanese-made vehicles during the protests were caught on television and are likely to put off even politically ambivalent Chinese buyers.”

Within China, there have been many demonstrations against Japanese-owned stores and companies, as well as Japanese-made products, such as Toyota vehicles. In fact, a MarketWatch article discusses specific dangerous encounters that occurred during the protests, involving Toyota vehicles and those driving them: “Li Jianli, 50, was on his way home after a day out with his family on Sept. 15 when a group of people nearly beat him to death. The incident began when anti-Japanese protesters spotted Li, his wife, son and son’s girlfriend in his Toyota. Seeing that the group was targeting Japanese-branded cars, Li got out and tried to dissuade the mob from attacking his car.”

According to the Financial Times, Toyota shut down its factories in China, due to the protests. The multinational has now re-opened production facilities in China, yet the manufacturing rate is lagging. Based on real-time data, Toyota stock (TM) is currently down by 0.43%.

Will Toyota production ever meet its previous level in China? Are those in China even willing to buy Toyota cars anymore? These questions most likely will remain on the minds of those running Toyota, especially as the protests persist.

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About Jessica Summers

My name is Jessica Summers. I graduated as valedictorian from Marymount Manhattan College in 2012 with a B.A. in Communications and minors in Journalism and Political Science. During college, I spent a summer abroad studying at Oxford University and also held internships at CNN International, CNBC Business News, and WABC-TV, among other news organizations and media outlets. I am currently a graduate student at New York University’s Business and Economic Reporting program. I am an aspiring broadcast journalist, especially interested in covering the world of business and finance.
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