Japanese auto plants closed after tsunami, creating parts crisis

The Associated Press
Posted March 18, 2011, at 6:43 p.m.

DETROIT — A week after the disaster in Japan erupted, its impact on automakers around the world is worsening.

Most of Japan’s auto industry is shut down. Factories from Louisiana to Thailand are low on Japanese-made parts. Idled plants are costing companies hundreds of millions of dollars. And U.S. car dealers may not get the cars they order this spring.

If parts factories in Japan stay closed for several more weeks, dealers and manufacturers will feel deepening effects: fewer cars, diminished revenue and frustrated customers.

Analysts say it’s too early to calculate the cost to the overall industry. But Goldman Sachs estimates the shutdowns are costing Japanese automakers more than $150 million a day.

Even if Japanese auto plants manage to restart in the next few weeks and make up lost production, threats will remain. Hundreds of car part suppliers were near the epicenter of the earthquake and tsunami in northeastern Japan.

How fast they can feed parts to car plants is unclear. Even after plants restart, the threat of rolling electricity blackouts — caused by Japan’s crippled nuclear reactors — could hamper production for months.

The damage could potentially reshuffle the entire industry. Rivals like Korea’s Hyundai Motor Co. could snap up new customers if the Japanese companies can’t serve them.

U.S. companies are hardly immune to the threats. General Motors Co. will halt production at its pickup plant in Shreveport, La., next week. It’s the first time a U.S.-based automaker will have stopped production in North America over parts shortages caused by the Japan crisis.

http://bangordailynews.com/2011/03/18/business/japanese-auto-plants-closed-after-tsunami-creating-parts-crisis/ printed on December 22, 2014