Toyota Motor Corp. is warning its U.S. dealers that it could face a shortage of new vehicles by the summer, a report said Monday, as the effects of the Japanese earthquake continues to hamper auto production.


Toyota could face a vehicle shortage in the U.S. by the summer, the Wall Street Journal reported Monday. ((Canadian Press))

The company warned its dealers in an internal memo that was obtained by the Wall Street Journal.

The report suggested that the shortage caused by the March 11 earthquake and tsunami would last into the third quarter.

The company also outlined supply issues and further cuts in production stemming from the disaster, which has shut down many suppliers and forced Toyota to halt production in Japan for nearly a month, the Wall Street Journal said.

"What we don't know are vehicle production levels for May through July," Bob Carter, head of the company's Toyota brand in the U.S., wrote in the memo. "The potential exists that supply of new vehicles could be significantly impacted this summer."

The company also plans to take an "extended Easter break" at its North American plants beginning April 21. Toyota's North American plants are already operating on a reduced schedule, and will be shut down for five days between April 15 and April 25.

In the memo, Carter blamed the extended break on parts shortages and said a decision on reduced schedules "will be made at a later date once the parts pipeline has been determined."

Toyota has an inventory of about 300,000 cars and trucks in the U.S., the report said. In March, the company sold about 156,000 vehicles in the U.S.

"Today we have good levels of inventory, but inventory will be getting tighter," Carter said in the memo. "Toyota will be producing new vehicles at significantly reduced levels."

Last week, Toyota said it would resume car production at all its plants in Japan at half capacity from April 18 to 27 after the earthquake and tsunami forced it to halt manufacturing due to shortages of parts and power.

Toyota, the world's No. 1 automaker, said production at its 18 plants would then halt from April 28 to May 9, a period that includes Golden Week holidays when factories would normally close in Japan.

The company said the parts shortage situation has been gradually improving since the March 11 tsunami but it is still struggling to procure around 150 types of parts. Toyota previously said there were shortages of about 500 types of components.