Japan Quake: Big Automakers Hit, Little Guys Spared (Except Subaru)

Edward Niedermeyer
by Edward Niedermeyer

Amidst the rubble of earthquake and tsunami-racked Japan, a strange phenomenon: Three of the smallest local automakers suffered no interruption in production, while the very largest seemed to be hit the hardest. Toyota, Honda, and Nissan have all suffered some kind of production interruption since the quake hit, while Mazda, Suzuki and Mitsubishi remain untouched according to Automotive News [sub]. In a tragedy like this, some might be tempted to ascribe this division of suffering to some universal sense of justice, a cosmic leveling of Japan’s automotive playing field. But, as the map above proves, this twist of fate is purely geographic… Mazda, Mitsubishi and Suzuki happen to have all of their plants located well south of the affected area near Sendai. Besides, Subaru, one of Japan’s smallest automakers, closed five factories. There’s no making sense of a mess like this…

Toyota’s string of bad luck seems to be continuing, if not purely at the hands of quake or tsunami damage. According to the latest word from the world’s largest automaker

The plants that have stopped production are Toyota subsidiary plants that produce parts and vehicles, including:

  • Toyota Motor Hokkaido Plant
  • Toyota Motor Tohoku Plant
  • Central Motor Corporation Miyagi Plant, which also produces the Yaris model.
  • Kanto Auto Works Iwate Plant, which also produces the Scion xB and Scion xD.

But even though Toyota itself was largely spared, the market is punishing it. Reuters reports that Wall Street is

The massive earthquake in Japan on Friday fueled defensive options trades in large Japanese companies and in an exchange-traded fund that tracks Japanese equities

“Traders are primarily buying put options, perhaps as a hedge against existing long stock positions in case of a prolonged shutdown in their automotive and parts production facilities in Japan,” said Jon Najarian, a co-founder of stock and options website optionMonster.com in Chicago.

And, according to yet another Reuters piece, Toyota’s low inventories of Lexus luxury vehicles could be especially vulnerable to interruptions. And, according to Automotive News [sub]

The shutdown could affect exports to the United States of such cars as the sedan, and , as well as the subcompact, Accord sedan and CR-V crossover. The tremblor also affected production of the Acura and Infiniti lineups.

But so far, the worst news comes out of Honda and Nissan, namely that

At least one person died at Honda’s r&d facility, and fires erupted at two Nissan plants.

The LAT gives more details on the Honda situation, notingHonda Motor Co. has shut three plants through Monday, including one where it makes the Fit sub-compact car and the top of the line Acura sedan that are exported to the United States. Its research center in Tochigi also was damaged, killing a 43-year-old man, and at least 30 other Honda employees were injured in the region.The WSJ takes Nissan, reportingNissan Motor Co. said it had immediately suspended operations at five factories in Fukushima in the north east, and Tochigi and Kanagawa prefectures, north and south of Tokyo. Small fires broke out at its Tochigi and Iwaki plants but have been extinguished, the company said.Both Infiniti and the Nissan Leaf EV could be affected, notes the Journal, but Renault (which owns nearly the majority of Nissan’s stock) could be the one sweating its exposure. Meanwhile, though supply issues are still being resolved, the Japanese automakers’ commitment to Just In Time (JIT) manufacturing practices mean any supplier interruptions will be noticed soon. Of the major global supplier firms with operations in Japan, only Denso is reporting damage at one factory.More than damage at any one firm, though, what’s driving the market fears seems to be worries about Japans road, power and port infrastructure. Even if the factories themselves are fine, they still have to get their products to market. For now though, the opportunities to shift production to the US seem “limited,” according to an analyst speaking with Automotive News [sub]. Needless to say, everyone will know a little more about the situation tomorrow.


Edward Niedermeyer
Edward Niedermeyer

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  • BlackPope808 BlackPope808 on Mar 12, 2011

    So what The Truth About Cars is saying is: America paid its karmic dues when our automobile industry pretty much tanked on us...required us to bail them out...and continues to lead a fantasy market on the road to oblivion?

  • SVX pearlie SVX pearlie on Mar 12, 2011

    I wonder why Subaru shut down. They're well inland. Earthquake damage perhaps?

  • 1995 SC At least you can still get one. There isn't much for Ford folks to be happy about nowadays, but the existence of the Mustang and the fact that the lessons from back in the 90s when Ford tried to kill it and replace it with the then flavor of the day seem to have been learned (the only lessons they seem to remember) are a win not only for Ford folks but for car people in general. One day my Super Coupe will pop its headgaskets (I know it will...I read it on the Internet). I hope I will still be physically up to dropping the supercharged Terminator Cobra motor into it. in all seriousness, The Mustang is a.win for car guys.
  • Lorenzo Heh. The major powers, military or economic, set up these regulators for the smaller countries - the big guys do what they want, and always have. Are the Chinese that unaware?
  • Lorenzo The original 4-Runner, by its very name, promised something different in the future. What happened?
  • Lorenzo At my age, excitement is dangerous. one thing to note: the older models being displayed are more stylish than their current versions, and the old Subaru Forester looks more utilitarian than the current version. I thought the annual model change was dead.
  • Lorenzo Well, it was never an off-roader, much less a military vehicle, so let the people with too much money play make believe.
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