Tokyo's benchmark stock index fell sharply on Monday for the second straight trading day.
The Nikkei Average closed at 29,174, down 2 percent from Friday's close.
The result came after major semiconductor maker Renesas Electronics partially suspended chip production at a key plant following a fire.
The shutdown raised concerns over the supply of semiconductors, prompting many investors to unload auto-related shares.
The Nikkei 225 also continued to feel the negative impact of a change in the Bank of Japan's monetary easing program.
The BOJ is limiting its purchases of exchange-traded funds to those linked to the broader TOPIX index, excluding Nikkei-linked options.