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Shares in Toyota, the world’s biggest carmaker, recorded their worst intraday fall since the start of the coronavirus pandemic on Wednesday, a day after the company warned the market that semiconductor shortages would likely cause it to miss its annual production target.
The 4.7 per cent drop in the share price of Toyota, which is also Japan’s most valuable company, was the largest since March 2020 and led to a broader sell-off in the benchmark Topix index, which pushed shares in two of its major suppliers, Denso and Aisin, down more than 5 per cent.
The Toyota stock later pared losses to be down about 4 per cent, on track for the worst daily fall in five months.
The Toyota announcement brought an abrupt end to a year of steady share price increases that have pushed the stock more than 50 per cent higher since January 2021.
Before the announcement on Tuesday that it would miss production targets for the fiscal year ending in March, the company’s market capitalisation stood at its highest ever and valued the company at over ¥40tn ($349bn).
Toyota shares were propelled to a peak this month after the company said in December that it would invest $35bn into producing 3.5m electric vehicles annually by 2030. That announcement eased concerns among investors that Toyota’s reluctance to commit to building EVs would exclude it from a market primed to deliver massive future growth.
But the Japanese automaker’s warning has hit euphoria among shareholders, who told the Financial Times that the company’s plan to reduce its February output by almost 150,000 vehicles was chilling. Toyota had revised its annual production target in September.
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