Toyota Motor ( TM Quick Quote TM - Free Report) recently announced the decision to halt operations on seven production lines at five factories in Japan next month because of supply-chain bottlenecks, semiconductor chip shortages and the COVID-19 pandemic. The Japan auto giant stated that the latest suspension at the domestic factories will slash its output by about 20,000 vehicles amid procurement delays for semiconductors and other parts. Nonetheless, the automaker continues to stick to its global production target of 9 million vehicles for the fiscal year ending March 2022. Further, Toyota's January 2022 production plan to build 800,000 vehicles globally, announced in mid-December, will also be implemented. The production line for sport utility vehicles such as the RAV4 and Harrier at Toyota's Takaoka plant will be paused for seven days, including two days suspension due to the holiday season. Two lines at Toyota Auto Body's Yoshiwara Factory, one line each at the Inabe and Fujimatsu plants and two lines at Toyota Industries' Nagakusa plant will also halt two days of holiday production. This is not the first time that Toyota will continue downtime production at factories amid the worldwide shortage of automotive microchips and supply-chain issues that continue to bite automakers globally. In December, Toyota expanded production stoppages at some factories in Japan because of a shortage of components shipped from part plants in Southeast Asia where COVID-19 lockdowns have disrupted production. Recently, Toyota announced its plan to invest 4 trillion yen ($35 billion) to line up 30 battery electric vehicles (BEV) by 2030. It also aims to expand global sales of battery electric vehicles by 3.5 million units a year by 2030. By the end of the decade, the automaker has earmarked another 4 trillion yen for the development of other electrified vehicles, including hybrids and fuel-cell vehicles. Toyota will also take up its investment in battery development to 2 trillion yen ($18 billion) from the previously proposed 1.5 trillion yen. This big EV push is in sync with the company’s efforts in tapping the growing market of zero-emission vehicles. The automaker also revealed that it produced 627,452 vehicles in October, down from 845,107 units produced a year ago. Zacks Rank & Key Picks
Toyota currently carries a Zacks Rank #3 (Hold). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. A few better-ranked stocks in the auto space include Goodyear Tire ( GT Quick Quote GT - Free Report) and Tesla ( TSLA Quick Quote TSLA - Free Report) , both of which flaunt a Zacks Rank of 1 and Harley-Davidson ( HOG Quick Quote HOG - Free Report) , carrying a Zacks Rank of 2 (Buy). Goodyear has an expected earnings growth rate of 196.86% for the current year. The Zacks Consensus Estimate for its current-year earnings has been revised upward by 80 cents over the last 60 days. Goodyear beat the Zacks Consensus Estimate for earnings in the last four quarters. GT has a trailing four-quarter earnings surprise of 228.45%, on average. Its shares have risen 92.1% over the past year. Tesla has an expected earnings growth rate of 166.96% for the current year. The Zacks Consensus Estimate for its current-year earnings has been revised upward by 13 cents over the last 60 days. Tesla beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missing once. TSLA has a trailing four-quarter earnings surprise of 25.38%, on average. Its shares have rallied 45.3% over the past year. Harley-Davidson has an expected earnings growth rate of 34.92% for the current quarter. The Zacks Consensus Estimate for its current-year earnings has been revised upward by 34 cents over the last 60 days. Harley-Davidson beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missing once. HOG has a trailing four-quarter negative earnings surprise of 138.45%, on average. Its shares have dropped 6.1% over the past year.