Toyota plans to stop production in Japan for 1 week due to steel shortage

Toyota Motor Corp says it is forced to halt production at all car assembly plants in Japan between Feb. 8 and Feb. 13 due to a steel shortage following an explosion at one of its steel mills.

The largest automaker reported on Saturday that it exploded at its Aichi Steel Corp plant that makes steel used to make auto parts, including gearboxes and chassis, without specifying which vehicles will be affected. "Operations are scheduled to resume on Feb.15 and vehicle production lines outside of Japan will not be suspended," Toyota said in a statement.

Toyota previously said that due to problems at Aichi Steel, it is considering options for producing parts on alternative lines and purchasing special steels from other manufacturers. However, now, the company believes that it will be enough to stop the work of car assembly plants from February 6 within a week.

Toyota shares rose 1.8 percent on Monday, given strong market performance and the cancellation of an initial statement. Toyota Corporation produced 4.0 million vehicles in Japan during 2015, of which about 46 percent were exported. In December, production was up 10 percent from a year earlier, driven in part by the launch of the latest Prius gasoline hybrid.

The shutdown illustrates the risks of Toyota Motor's just-in-time inventory system, in which shipments are made multiple times a day, avoiding the need for excessive inventory as required by the system.

A fire at a partner plant in 1997 also caused the plants to shut down for five days, after which Toyota found a way out by using other firms to continue producing auto parts.