Japan's Car Production Under Water – Again

Bertel Schmitt
by Bertel Schmitt

Six months after having been devastated at home by the March 11 earthquake and tsunami, “Japan has experienced its largest overseas investment loss ever as a result of the flood disaster in Thailand,” Japans’s ambassador to Thailand Seiji Kojima told the Bangkok Post.

Thailand has become Japan’s favorite Asian production hub. More than 400 Japanese corporations have plants at huge industrial parks that have been flooded. On Monday, water began to inundate the large Navanakorn industrial park in the northern suburbs of Bangkok, reports The Nikkei [sub]. Yesterday, Thailand’s oldest industrial park was under water.

Mazda, Mitsubishi, Honda, Toyota and Nissan have shut down their plants in Thailand. Just like the Japanese tsunami, the floods have wider-ranging impacts. About half of the 1.64 million vehicles produced in Thailand last year were exported. Honda has already decreased output in Malaysia, because parts made in Thailand are missing.

Honda said yesterday that once the waters recede, it will take a month to re-start production at Thailand’s Rojana industrial estate, Reuters says. That can be a while.

Even if you are not in the market for a car, you have reason to worry. Want to buy a computer? Do it now. Says The Nikkei [sub]:

“Roughly 60 percent of the world’s hard drives are made in Thailand, so the floods will likely impact production of personal computers, recording devices and other equipment toward year-end.”

Bertel Schmitt
Bertel Schmitt

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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  • Eldard Eldard on Oct 19, 2011

    That's a Mitsu Strada, isn't it?

  • Adam Adam on Oct 19, 2011

    Bertel, thank you for staying on top of this situation. I deal with some supply chain issues in my line of work. As a result of those experiences, I have developed some level of morbid fascination with the fragility of our interconnected, low-redundancy global supply base. Hopefully the flood waters recede sooner rather than later so the affected Thai and Japanese folks can return to normalcy.