Carmakers brace for parts shortages after Japanese quake
Monday 28 March 2011
Ford is the latest car giant to cut production as the industrial fallout from the Japanese earthquake and tsunami ripples through the global automotive industry.
The US company said at the weekend that it will idle its factory in Genk, Belgium, for five days in early April, to conserve supplies of parts shipped from Japan.
The group stressed that the move is a defensive strategy, rather than a response to a direct shortage. "Given the situation in Japan, we took this as a precautionary measure," a Ford spokesman said.
But Ford is just the latest addition to a growing list of global car companies trimming their activities in response to the Japanese disaster.
Within Japan, major automakers are discussing plans to take turns to run their assembly lines, as the country suffers shortages from power plants crippled by the 9.0 magnitude earthquake and tsunami that devastated swathes of the coast, killing nearly 10,000 people and leaving another 16,500 missing.
The production rotation scheme – which aims to avoid scheduled blackouts – is one of several measures being mooted as manufacturers face a drop in power supply of up to 15 per cent.
Japanese carmakers have already significantly cut production following the disaster. Although Toyota plans to resume work imminently at three factories further from the disaster zone, shutdowns at the other nine of its plants continue, leaving the world's biggest carmaker short by around 140,000 vehicles so far. Rival Honda – which has lost output of an estimated 47,000 cars and 5,000 motorcycles – has also extended the shutdown at its Saitama and Suzuka car plants, although it is due to restart motorcycle production at its Kumamoto factory today.
Japanese manufacturers are also increasingly instituting slowdowns in their US factories because of concerns over the availability of parts shipped in from Japan. Toyota last week warned it will halt production at some US factories, having already suspended overtime and Saturday shifts at 13 North American plants. Honda has also advised of disruptions at five US facilities, and Mazda has stopped taking US orders for models made in Japan.
But it is not just Japanese suppliers that are affected. And although the majority of parts are still available so far, shortages are beginning to be felt.
A key issue for the industry is in the pigment used to give cars their shine. "Xirallic" is made at a single factory, owned by the German giant Merck, which is in a coastal town hit by the tsunami and just 28km from the damaged Fukushima Daiichi nuclear power station. Ford last week told US dealers to stop taking orders for vehicles in "tuxedo black", as well as limiting output of three shades of red because of concerns about the availability of the necessary pigments.
Another problem for global carmakers is the supply of airflow sensors produced by Hitachi at a factory north of Tokyo that was damaged by the earthquake and so far remains closed. GM and Peugeot Citroen have both slowed production at European factories because of concerns about a shortage of the sensors, although GM is set to resume normal working rates at its Louisiana truck plant today after a shutdown last week.
A dearth of parts from Japan could cut global car production by as much as 30 per cent, analysts estimate. With as many as 500 component makers affected by the disaster, prodution could drop by 100,000 vehicles per day if supply is not resumed within six weeks, according to some industry experts.
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