Chinese Toyota Plant Runs Out of Electricity

Matt Posky
by Matt Posky

Toyota has suspended operations at a factory in China because local authorities issued an order for the region to conserve electricity. Sichuan province is reportedly rationing energy for both residential and industrial zones, complicating things for manufacturers. Toyota has said that the plant is likely to be closed through Saturday — adding that it would be monitoring the situation and taking guidance from the Chinese government. But the issue could have sweeping ramifications because the area is also home to numerous part suppliers.

While Sichuan managed to avoid the nationwide energy rationing witnessed in 2021, attributed to a lack of coal, state-run Chinese media has reported the province has been impacted by record temperatures and severe drought. According to China’s Ministry of Water Resources, water levels of the Yangtze River are at historic lows. Though northern regions of the country, including the nearby Pengzhou, endured flash flooding over the weekend — and the country saw numerous dams bursting after sustained rains earlier in the year. All of the above has allegedly done a real number to the nation's ability to produce hydroelectric power.

Needless to say, there are parts of the country that are in a bad way and local officials have become concerned about how citizens will respond. According to the South China Morning Post, the government's planned electricity cuts will only last a few hours and focus on industrial areas so that residential power is maintained. However several cities in the area (e.g. Dazhou) have already announced rolling blackouts for a couple of days.

Considering Toyota thinks it might not have reliable access to electricity until the weekend, something tells us the issue might be bigger than presented by the state-run press. According to Reuters, the province is expecting producers of lithium, fertilizer, and various metals used in construction to temporarily shut down or curb their output if they manage to stay open. Market analysts are already speculating that this could further spur the prices of EVs, and automobiles in general, as the value of the relevant (and seriously in-demand) commodities continues to climb.

Toyota's factory in Sichuan builds the Coaster and Land Cruiser Prado intended for the Asian market. So it's unlikely there will be any production issues that'll reach North America. But the area likewise encompasses factories producing all manner of auto parts (e.g. tires, gaskets, belts, control arms, bearings, electronics, shock absorbers) intended for export.

Keeping tabs on how much downtime the Toyota plant actually sees in the coming days may be indicative of the general state of the region's manufacturing capabilities. Unfortunately, Toyota said it didn't know how much the shutdown would diminish output. Meanwhile, the Department of Economy and Information Technology of Sichuan notified industrial-based electricity users in 19 out of 21 major cities located in the province to suspend production from August 15th through the 20th.

“We’re monitoring the situation every day and following the guidance from the government,” a Toyota spokesperson said.

[Image: Andrii Medvediuk/Shutterstock]

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Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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3 of 11 comments
  • Conundrum Conundrum on Aug 19, 2022

    Some parts of the US are in a bad way due to drought and climate change as well, but Posky manages to avoid mentioning Lake Meade, Musk going bananas over no water for his Nevada gigafactory, a few wildfires and floods here and there. No let's have a chuckle over China's experience instead, and chuck in the name Toyota in the headline as a draw.

    Musk is demanding China ensures his Shanghai factory gets plent 'o power, because that's what spoilt billionaires do. Me, me, me first. Doesn't work when everyone's gasping for breath.

    Kind of seems to me that avoiding the obvious is the American way. Let's burn some more coal and make things much better! Yeah!

    Meanwhile, apparently whoever runs this website on a technical basis needs to go back to training school.

    meanwhileThe way this site "operates", which it mainly doesn't, is a complete farce!

    Let's have an opinionated article on that.

    • Matt Posky Matt Posky on Aug 22, 2022

      Lake Meade drying up because it's a man-made lake in the center of the driest state in the whole country. I'll report on it when starts resulting in fewer cars being manufactured.

      Meanwhile, in related news, Volkswagen has also begun reporting widespread downtime in China due to power outages. That's likely why Elon Musk is freaking out about the future of the Shanghai plant.

  • Randy in rocklin Randy in rocklin on Aug 22, 2022

    They need to outlaw golf courses.

  • Bd2 Probably too late to do anything about it for the launch, but Kia should plan on doing an extensive refresh of the front fascia (the earlier, the better) as the design looks really ungainly.
  • Namesakeone Since I include SUVs and minivans as trucks, I really cannot think of a brand that is truly truckless. MG maybe?
  • Sobhuza Trooper Subaru, they were almost there with the BRAT. --On a lighter note, where the hell is my Cooper Works Mini truck?
  • Mike Evs do suck, though. I mean, they really do.
  • Steve Biro I don’t care what brand but it needs to be a compact two-door with an ICE, traditional parallel hybrid or both. A manual transmission option would be nice but I don’t expect it - especially with a hybrid. Don’t show me an EV.