Japanese Parts Paralysis: Toyota Japan Production On Half Rations Into The Summer
The March 11 tsunami is having long term effects on Japanese car production. Toyota, the world’s and by far Japan’s largest car company, is severely impacted. Toyota just announced that vehicle production from May 10 to June 3 will proceed at approximately 50 percent of normal.
Basically, Toyota will open all its Japanese vehicle-production plants on Monday, April 18, and will run them on half steam until April 27. Then, Toyota will take the annual spring holiday a day earlier and close on April 28th. Toyota will extend the holiday for another full day and will start working on May 10. One day of these extended holidays was planned, the other was not. Production will then continue at 50 percent capacity through June 3. Which does not mean that all will return to normal in June.
“TMC will decide on production after this period after assessing the situation of its suppliers and other related companies,” the statement says. The “other related companies” do not directly refer to Japan’s teetering power companies, as one may think. “Most of Toyota Motor Corporation’s Japanese production capacity is located outside of the areas serviced by the Tokyo and Tohoku Electric Power companies,” says Toyota spokesman Paul Nolasco. He says the “other companies” could be shipping companies, Tier 2 and 3 suppliers etc.
The power shortage however will impede many of these other companies for months to come. The Nikkei [sub] writes that Japanese “utilities are delaying the restart of nuclear reactors that have been shut down for regular maintenance and inspection, amid rising safety fears among residents.” According to the report, “sixteen reactors have been halted for maintenance, of which eight have postponed their restarts.”
Once June comes around, Toyota will have had lost approximately half of its Japanese production in March, about two thirds in April, and half in May. Overseas shipments of cars and parts needed for overseas production will continue to suffer well into the summer.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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