Saturday 19 March 2011

Tsunami impact on Japan car industry

JAPAN'S seven major carmakers are reeling in the wake of the massive earthquake and tsunami that hit the country.

Production has been stopped at most factories this week, with Honda extending its shutdown through until at least Sunday, despite minimal damage at the big car plants that are located to the south of Tokyo.The problems caused by the quake include everything from damage to component supply companies and power interruptions in the disaster zone to the time needed for workers to re-connect with family members affected by the events. There are also concerns about damage to port facilities needed for exports, including shipments to Australia.

The only direct casualty was a death at Honda's research-and-development centre at Tochigi, although 16 other people were also injured. The Australian outposts of the Japanese brands are still battling to get information and any long-term predictions, although there is at least one chilling story from Nissan.

"Head office in Yokohama is on skeleton staff; many hundreds stayed there on Friday night, some walked 20 kilometres home," says Nissan Australia's Jeff Fisher, speaking soon after the quake. Nissan's port facilities at Hitachi were also badly affected by the tsunami.

But Fisher reassures supporters of the brand's sports cars, which are built at the Tochigi factory which was affected by the quake "We have recently received a major shipment of GT-R and Model Year 2011 Z-car from Tochigi so have supply for the next couple of months or so," he says.

At Honda, the short-term worry is for 113 suppliers in the quake zone and the ongoing interruptions to its operations at Tochigi. It is already predicting the loss of around 16,000 vehicles it was planning to build. Mazda, the biggest pure import brand, says it is not expecting much impact.

"Based on current information, the disaster is unlikely to have any major effect on stock supply to Australia in the short term. Mazda will continue to closely monitor the situation to assess what other effects it may have," says Mazda spokesman, Steve Maciver.

"Mazda's production plants have not been damaged (but the company) will announce any further production changes for March 17 onward as soon as a decision is made. Even so, Mazda is already joining the relief effort.

"As a first response, Mazda is making an immediate donation of 30 million Yen ($368,000) to support rescue efforts and assistance in the region. Mazda plans to monitor the situation and will also make badly needed materials - along with personnel - available as required," the company says.

Toyota is expecting to lose 40,000 vehicles from its short-term production schedule but there is little information yet on the potential knock-on effect in Australia. "It's too early to provide any accurate information. Toyota places utmost priority on ensuring the safety of all team members at Toyota, its subsidiary vehicle manufacturers such as Central and Kanto, and at its suppliers, as well as on confirming the safety of their family members," says Mike Breen, spokesman for Toyota Australia.

Mitsubishi is still waiting for word from Japan but says the one Australian in Japan on business is safe, although it took longer than normal to return to Tokyo for a flight home to Adelaide.

Suzuki has probably done best among the big carmakers. "It appears Suzuki has escaped damage. The earthquake's epicenter was located nearly 400 kilometres north of Tokyo while Suzuki's headquarters are in Hamamatsu City, which is 250 kilometres south of Tokyo," says Suzuki spokesman, Andrew Ellis.

Subaru was also lucky on the location of its Japanese operations. "Our main factory is located at Gunma, northwest of Tokyo. This is inland and a long way from the epicentre.  Our cars are shipped ex Yokohama and the extent of damage between the factory and there is still be assessed," says Dave Rowley of Subaru Australia.

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