Daihatsu Motor, Toyota Motor’s small car unit, is set to provide compensation to 423 domestic suppliers with whom it has direct business relations. This move comes as Daihatsu’s production plants in Japan remain idle due to an ongoing safety scandal. The small car specialist has suspended production in Japan until the end of the next month.
The compensation for suppliers will be determined based on past business volumes, and the company is actively assessing the overall impact of the production stoppage on its extensive supplier network. Daihatsu’s decision to halt shipments of all its vehicles was prompted by a safety investigation that identified issues across 64 models, including nearly two dozen sold under the Toyota brand.
While working with main suppliers to address the repercussions of the safety scandal, Daihatsu is also considering ways to assist smaller subcontractors that may not receive direct compensation. The company is exploring avenues to help them access support funds from the industry ministry.
Daihatsu, which operates significantly in Southeast Asia, has resumed production of Perodua brand cars at joint venture plants in collaboration with Malaysian automaker Perodua after obtaining regulatory clearance. Additionally, shipments from its Indonesian subsidiary, PT Astra Daihatsu Motor, have resumed after the required regulatory approvals.