#Earthquake

As early as a week from now, Honda’s North American production in Ohio, Alabama, Indiana, Canada and Mexico will be affected by the Japanese parts paralysis. Bloomberg talked to Natsuno Asanuma, Honda’s spokeswoman in Tokyo. She said workers will be informed once Honda has decided on a production plan.

The Japanese parts paralysis claims a new victim. Allegedly. Ford will close its plant in Genk, Belgium, for five days starting April 4. The idea is to conserve auto parts in the wake of the earthquake and tsunami, Ford said in a statement emailed to the media. According to the Wall Street Journal, the Belgium plant was scheduled to be idled for five days in May to keep the production of cars in line with demand. Ford moved up the closure “to ensure we have parts availability going forward given the current situation in Japan,” Ford spokesman John Stoll said.

After the Mach 11 earthquake and tsunami shut down a large number of power plants in Japan, rolling blackouts were instated in large parts of the country. Lack of power emerges more and more as the biggest impediment to a quick recovery.of the Japanese automotive industry. Most of the industry has been shut down. Power will remain scarce for many months in Japan. Come summer and A/C time, the situation will be worse. Japanese automakers are now considering running their factories in rotation to help cut the industry’s electricity consumption, The Nikkei [sub] writes today. Japan’s automakers could prepare for a production loss of well over a million units for the year.

So far, it had been clear that the March 11 earthquake and tsunami would create big problems for the auto industry in Japan in particular and worldwide in general. When asked when, where, and how much, all we received were shrugging shoulders when taking to a westernized counterpart, or an “eeeh” or the customary sucking of air through the teeth when talking to an old school Japanese. Now finally, the first facts emerge.

Vehicle output of Japan, the world’s second largest car producing nation, was down across the board in February. The reductions reported today by Japan’s majors pale in comparison to the dramatic losses that will be announced for March, and quite possibly for months to come.

Parts shortages triggered by the earthquake and tsunami in Japan could reduce global automobile production by up to 30 percent, research firm IHS Automotive told Bloomberg. Or at least that’s what Bloomberg heard.

Days after the earthquake an tsunami had devastated large parts of the north-east Tohoku area of Japan, Toyota was still cut off from its factories in the hardest hit Miyagi prefecture. A convoy of six water tankers, two fuel tankers and nine cargo trucks braved impassable or closed roads and reached the area on Sunday after the quake. A second convoy arrived on Monday.

By now, Toyota has an out-and-out private army in the region, helping factories and the surrounding communities.

Beginning on Monday, March 28, Toyota will restart production of three hybrid cars “which are in high demand” as Toyota spokesman Paul Nolasco said.

Both lines of Toyota’s Tsutsumi plant in Toyota City will begin full Prius production on Monday. These used to be mixed production lines. A few cars were left incomplete when Toyota stopped all production in all of Japan after the quake. Those cars will be finished. Then, both lines will make exclusively Prii (as in the now official Toyota Prius plural.)

Our daily run-down of delays, shut-downs, shortages, and postponements, triggered by the March 11 tsunami in Japan.

• Toyota informed its U.S. dealers and workers to expect production slowdowns due to parts shortages. “Today, we communicated to team members, associates and dealers here that some production interruptions in North America are likely. It’s too early to predict location or duration,” Toyota said in a statement. Most, but not all of the parts for vehicles built in North America are sourced here. Wall Street Journal
• Toyota expects to idle its pickup truck assembly plant south of San Antonio. “We are informing our team members that, with the situation over in Japan, it is likely that we will see some nonproduction days coming,” Craig Mullenbach, spokesman for Toyota’s San Antonio plant, said. Mullenbach added that parts needed to build the full-sized Tundra and mid-sized Tacoma pickup truck in San Antonio are running out. Reuters
• Honda will suspend car production at its Japanese factories until at least April 3. Honda will temporarily transfer some functions such as car development and procurement out of its badly damaged R&D center in Tochigi. Reuters

Our daily run-down of delays, shut-downs, shortages, and postponements.

• Toyota will delay the introduction of the wagon version of the Prius hybrid in Japan. A launch event was planned for late April. This event is cancelled; a new date has not been set. The Nikkei [sub].
• Toyota will also delay the minivan version of the Prius, Reuters adds.

Japan is, after China, the world’s second largest car producer. In the first ten days after the March 11th earthquake and tsunami, the Japanese auto industry lost approximately 65 percent of its capacity. That is 338,000 units. Toyota alone has lost production of about 140,000 vehicles since March 14, says AP [ via MSNBC]. What will happen next? Will it affect us, and how?

Amongst banks and brokers, staid Morgan Stanley is one of the respected ones. Morgan Stanley always had a presence in Asia and manages many Asian funds. Japan’s Mitsubishi bank owns 21 percent. Morgan Stanley has no interest in talking Japan down. However, in a 34 page research note, sent out today, titled “Japanese Earthquake: Global Supply Chain Implications”, Morgan Stanley paints a dark picture: “A prolonged disruption of Japanese component supply could have a significant impact on 2011 auto production and profitability.” Not just in Japan, the world over. It is likely to depress sales: “ The impact on US SAAR could be severe in May.”

Instead of editorializing, let’s just give you the salient parts. You may want to have a stiff drink first. And your broker’s phone number nearby.

After a long weekend (Monday was Spring Equinox), Japan came back to work today. Most of the Japanese auto industry did not.

Japan’s largest automaker Toyota, and Japan’s third largest, Honda, won’t be making any cars this week. Japan’s auto production is paralyzed.

For days, I have been trying to get a clearer picture of what is really going on outside of the largely intact gates of the major Japanese carmakers. Nobody is talking. Most keep mum because they don’t know. Some don’t talk because they don’t want to.

Now there is a rare glimpse into the matter. It has been written by Kevin Krolicki with the help of two colleagues at Reuters. Kevin is the Detroit bureau chief of Reuters. He writes about cars a lot. Comes with the territory. Kevin and I share a common affliction: A Japanese wife. A week ago, Kevin found himself going against the stream of expats that were mobbing the planes out of Japan.

Two days after the quake, Kevin went from Detroit to Tokyo to help the team of Reuters reporters in Japan.

New twist in GM’s hunt for the elusive carpart: Opel’s Eisenach plant will resume normal operations tomorrow, Tuesday. It was reported to suffer a serious shortage of Japanese parts.