Japan earthquake: auto industry – Monday update image

Hit by an earthquake and tsunami in mid-March, automotive industry is still having problems. This week, JAMA announced that Japanese producers have lost more than 500 thousand units of production following the March 11 earthquake.

The primary impact from the quake impacted on OEM factories was initially limited, but the big hit came on the supply base. This will get worse before it get better.

Toyota Motor on Monday ( APR 18 ) resumed operations at all its domestic plants that had been halted since the March 11 earthquake and tsunami, with volume still at around 50 percent due to a shortage of parts. Of the Toyota group’s 18 assembly plants in Japan, three had already been in operation and the rest resumed production Monday, according to the Japanese auto giant.

“The plants are operating with about 50 percent of production due to the shortage of auto parts,” a Toyota spokeswoman said.

The head of a Honda Motor Co plant said Monday that domestic output at the facility would not return to pre-earthquake levels anytime soon and that parts supplies would be monitored to decide when to increase volume.
“It will be hard to restore (volume levels at the plant) in one to two weeks” to pre-quake levels, said Ko Katayama, who oversees operations at a plant in Sayama, Saitama Prefecture, north of Tokyo.
The automaker resumed auto assembly at its two domestic production plants in Sayama and Mie Prefecture, western Japan, a month after the March 11 quake and tsunami.
Starting this week, Nissan will stop production at two Tennessee plants.
The twin disasters in Japan have caused a supply shortage for Nissan, so officials have decided to move up scheduled non-production days. Those days were slated for later this year, but have now been scheduled this month. The plants already closed for two days earlier this month.

Analyst Edmunds.com said the earthquake and its aftermath could cut 2011 U.S. auto sales to a rise of 6 percent over 2010 instead of the 12 percent rise that is currently forecast.

More updates to come