In the wake of safety concerns leading to the suspension of its Japanese plants, Toyota Motor’s subsidiary, Daihatsu Motor, has announced plans to compensate 423 domestic suppliers directly affected by the production halt.
According to Reuters, the suspension, set to continue until the end of next month, comes in response to safety concerns identified in 64 models, nearly two dozen of which are sold under Toyota’s brand. A Daihatsu spokesperson revealed that the compensation strategy would be based on past business volumes, aiming to address the financial impact on the extensive supplier network.
Daihatsu’s decision to cease shipments of all its vehicles follows a safety investigation that uncovered issues in various models. While the company is grappling with the suspension, it remains committed to mitigating the consequences for its supplier network.
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The spokesperson emphasised that Daihatsu is collaborating closely with its main suppliers to manage the aftermath of the safety scandal. Moreover, the company is exploring ways to assist smaller subcontractors, not covered by compensation, in accessing support funds provided by the industry ministry.
Daihatsu’s overseas operations, primarily concentrated in Southeast Asia, have been notably affected by the production halt. Despite the challenges, the company has resumed the production of Perodua brand cars in collaboration with Malaysian automaker Perodua.
Regulatory clearance was obtained for the joint venture, allowing Daihatsu to recommence operations at two plants. The spokesperson highlighted that the company’s subsidiary in Indonesia, PT Astra Daihatsu Motor, has also resumed shipments as of Friday, signalling a gradual recovery in certain overseas markets.
(With inputs from Reuters)
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