The automaker will reduce output again in November, but the impact will not be as painful as before and Toyota sees signs of recovery on the horizon.
Toyota now sees output at 850,000 in September and only 800,000 in October,
Toyota said it would slash its global production plan for April by 150,000 units to 750,000 vehicles, compared with the original schedule reported to suppliers earlier this year.
Toyota's overseas output climbed 5.6 percent to 3.35 million vehicles through June, while production in Japan fell 18 percent to 1.73 million.
Truck maker Hino's new emissions scandal has some observers wondering about its future with Toyota.