Thailand Floods: S&P Said No Immediate Ratings Impact On Japanese Automakers image

Standard & Poor’s (S&P), the rating-financial services company on Wednesday said that there is no immediate impact on its ratings on Japanese automakers and suppliers after Thailand’s floods disrupted their supply chains.

Toyota Motor Corp. has scaled down its domestic production due to the floods. The automaker said it is struggling to procure more than 100 items, such as engine parts, plastic and aluminum wheels.
Last Friday, Toyota said it would reduce output in Indonesia, Vietnam and the Philippines for five days from Monday due to possible parts supply disruptions from Thailand.

Honda Motor also said it had suspended production of motorcycles in Bangkok’s Ladkrabang area from Tuesday until at least Saturday.

“The factory producing motorcycles remains intact from the flood, but parts supplies have been disrupted,” said Honda spokeswoman Tomoko Takemori.

Nissan Motor Corp. on Tuesday said that its operations at the Samut Prakan plant are suspended and this production hold will continue until Friday, October 28, due to shortage in parts supply.

According to the Federation of Thai Industries, Thailand will miss its target of 1.8 million units this year, building only 1.74 million automobiles because of the parts shortage after hundreds of factories have been submerged.

Exports were projected to reach 1 million units this year but the lower automobile output will reduce exports by some 100,000 units.

Credit ratings for Thai automakers/divisions:
Toyota Motor Corp. (AA-/Negative/A-1+)
Honda Motor Co. Ltd. (A+/Negative/A-1)
Nissan Motor Co. Ltd. (BBB+/Stable/A-2)
Mitsubishi Motors Corp. (B+/Stable/–)