The pandemic and undersupply of materials have disrupted the car supply chain in Asia, according to VIR, as some Asian countries are seeing a high infection rate of the Delta variant.

The resurgence of the pandemic leading to undersupply of materials has forced Honda, Toyota, and Suzuki to halt production in China. Honda's three factories in Wuhan, China have shut down indefinitely.

According to Goldman Sachs, the global automobile industry is expected to shrink by US$20 billion in operating profits in 2021 due to tepid sales growth caused by a shortage of semiconductors.

This month, Toyota stopped three assembly lines in Japan for a number of days due to a disrupted supply chain in Vietnam by the Delta variant, bringing Toyota's reduction of cars produced to 8,000. Toyota's three major assembly factories in Thailand also shut down. In normal times, these three factories can produce a total of 750,000 passenger cars and commercial cars every year.

Toyota has released a statement regarding the pandemic, shortage of chips, and the rising price of materials, saying the circumstances are still unpredictable.

Ford and General Motors are no exception. Unable to ensure sufficient chip supply, GM has reduced production in May by 278,000 cars; Ford had to slash production by half in the second quarter.

Car distributors in Vietnam bear a pessimistic outlook for sales in August, following sluggish sales in July. Japan External Trade Organization (JETRO)'s chief representative in Ho Chi Minh City Hirai Shinji was cited as saying that it's tough for their workers having to stay overnight at the manufacturing sites.

Although some workers are prepared for what's to come, some workers have to stay home to look after their families. Even with a certain number of workers on-site, production is still too low to meet demand. However, it's better than nothing.