Chinese Strikes: It Ain't Over Until It's Over – Toyota And Honda Down Again
Toyota stopped the lines at their Guangzhou assembly plant Tuesday, after they had run out of fuel injectors. The parts were supposed to come from Toyota-affiliated Denso (Guangzhou Nansha) Co., where workers went on strike on Monday, says The Nikkei [sub]. This Wednesday afternoon in China, the Denso workers are still saying “hell, no” (or Chinese words to that effect), and the Toyota plant sits idle. Reuters says no decision has been made to re-start production.
Toyota’s Guangzhou plant accounts for more than 40 percent of Toyota’s Chinese output.
According to Nikkei’s information, the Denso plant also supplies parts to Honda, Suzuki, and Mazda.
Lo and behold, today Honda halted production at one of two plants of their Guangqi Honda joint venture. An operation spokesman told Reuters he does not know when production will resume.
A little later, the second plant of their Guangqi Honda JV shut down. This time, because of a lack of springs. Turns out that a Chinese factory of Japan-owned NHK Spring was hit by a strike late Tuesday. Reuters says, they also make springs for Toyota and Nissan.
As a sign that it’s news when a Japanese auto maker remains open in China, The Nikkei [sub] quotes Nissan’s CEO Carlos Ghosn, who said today that “so far, things are going smoothly” at Nissan in China. Let’s hope they are well stocked on springs.
An interesting pattern evolves:
- Strikes at strategically chosen suppliers, often involving only a few hundred strikers, can paralyze big manufacturers. The Chinese did learn well from the U.S. and Europe.
- There are no strikes at carmakers themselves, which are part of joint ventures, usually with government-affiliated partners. They shut down because they have no parts, not because there is a strike.
- So far, the strikes affect only Japanese carmakers. The lines at GM, Volkswagen, Ford, BMW etc. are running.
GM’s Kevin Wale remains unimpressed. He’s seen worse at home. “It’s common. Labor issues occur everywhere, but China’s huge market potential is more important,” said Wale to China Daily.
Meanwhile at the media front, that epitome of journalistic integrity, ABC News, can’t help themselves and reports that “domestic media has been instructed not to report on the subject.” As proof, they cite an anonymous “internet user” who says: “The Denso strike did happen but authorities have sealed off the news.” You don’t say.
Someone should tell them that it’s as easy as going over to state-owned China Daily, where the strikes are daily news fodder. They have the Denso strike right here. Same at Global Times, the English version of the Communist Party’s Newspaper, People’s Daily.
Global Times even mentions a report by the All-China Federation of Trade Unions that warns: “The accumulation of these demands and problems has begun to have a negative effect on our country’s political and social stability and sustainable economic development.” Doubting China’s political and social stability? In a party-owned paper? Where’s the world coming to?
Update: Reuters says NHK strike settled, Honda plant 2, up again. Plant 1 still closed due to Denso strike.
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