Japanese automakers suspend vehicle production

According to “IHS Global Insight Perspective,” Japan’s auto industry has come to a halt as the physical impact of the disaster has combined with power-conservation measures to hit production

By Patrick Burnson · March 17, 2011

Following last Friday’s earthquake and subsequent tsunami, nearly all Japanese automakers have idled production, owing to either physical damage or rolling blackouts.

According to “IHS Global Insight Perspective,” Japan’s auto industry has come to a halt as the physical impact of the disaster has combined with power-conservation measures to hit production.

“Although the human cost is of paramount concern, the ripple effect of the stoppages to supply and production in Japan will be felt in many parts of the world, including the United States, China, and Europe, as many key parts and technology are exported to global operations from Japan,” stated the report.

Analysts said the situation “is still fluid” and the impact of the disaster still being assessed. This should become clearer as the week unfolds and more information is gleaned about the extent of the damage to infrastructure in the country, the manufacturing plants, and indeed the communities that support the industry.

Initial discussion of the severity of the impact on the industry is centered around a few main areas of concern, including OEM assembly plant production. According the latest report, several auto plants in and around the northern Miyagi Prefecture have been shuttered – primarily Toyota, Honda, and Nissan facilities.

Many more auto plants throughout the country are at risk of closure, added analysts, some owing to temporary rolling blackouts that are being considered in order to conserve power in light of the damage to several Japanese nuclear power plants.

Brandon Fried, executive director of the Air Forwarders Association, told SCMR that air carriers are being called in to take out some components that would ordinarily move by ocean vessel.

“Japan’s airports are in much better shape than its seaports,” he said.
IHS also noted that there’s been some through disruption to the country’s transport infrastructure, affecting everything from parts delivery, personnel mobility, and shipping activity.

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About the Author

Patrick Burnson
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

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