Toyota plans to reduce overseas vehicle production by around 100,000 units through February 2027, citing weakened demand tied to disruption at the Strait of Hormuz, reported Nikkei Asia.

The Japanese carmaker has informed key suppliers of the revised production outlook, the report said.

Military strikes on Iran by the US and Israel have disrupted tanker traffic through the strait, pushing fuel prices higher and dampening vehicle demand across several regions, including China and the Middle East.

Toyota had already reduced domestic output of vehicles bound for the Middle East by approximately 40,000 units in March and April.

Its earlier plan had envisaged a reduction of roughly 83,000 vehicles at overseas plants between June and November – a figure the latest revision now surpasses.

The production cuts will span several models, encompassing petrol-powered variants of the RAV4 SUV and the Avalon sedan.

Electric vehicles earmarked for the Chinese market are also being scaled back, as competition among manufacturers intensifies and EVs have become the leading vehicle segment there.

Models facing output reductions include the bZ3X entry-level electric vehicle, the bZ7 sedan and the Camry sedan.

In contrast, Toyota intends to raise domestic production in Japan by 4,200 vehicles during the second half of the fiscal year compared with its May plans.

Output of the RAV4 and Land Cruiser 250 SUV is set to increase domestically, while Lexus ES sedan production for China will be trimmed amid softer demand.

A preliminary agreement to resolve the conflict has improved the outlook for reopening the Strait of Hormuz, though persistently elevated energy costs continue to defer consumer purchases.

Toyota had previously targeted output of around ten million Toyota and Lexus vehicles in the fiscal year ending March 2027, equating to a 1% year-on-year increase.