Japan disaster production setbacks will ripple to the U.S.

Japan disaster production setbacks will ripple to the U.S.

A new study suggests that parts shortages caused by Japan’s earthquake disaster may reduce global automobile production by about 30 percent. Most of that impact would fall on Japan based automakers, which will in turn impact large vehicle markets in the U.S. like metropolitan Washington. Japanese brands, of course, are very popular here. Indeed, in a market that is heavily import oriented (more than 70 percent), Japanese brands predominate the Top Ten spots in new passenger car sales in the metro Washington area.

If parts plants affected by the quake don’t return to operation within six weeks, global auto output may drop as much as 100,000 vehicles a day, said Michael Robinet, vice president of Lexington, Massachusetts based IHS. The industry produces 280,000 to 300,000 vehicles daily, he said.

Honda Motor Co., which has closed two car assembly factories until April 3, is one of the most exposed carmakers. It has 110 suppliers located in the earthquake zone.

Toyota Motor Corp., has shut down all assembly plants in Japan until at least March 26, and has indicated it may need to shut plants in the U.S. as well. The company said it will resume production of three hybrid models in Japan on March 28.

General Motors Co. has idled a pickup factory in Shreveport, Louisiana, because of parts shortages. Ford Motor Co. hasn’t reported any disruptions yet.

Japan based automakers and parts suppliers produce a significant portion of the electronics and transmission components found in cars today. If carmakers can’t find alternate sources of parts, or if plants don’t come on line in eight weeks, as much as 40 percent of daily production may be lost, the IHS study said.

Automakers can make up for one week of lost production with about six weeks of overtime, Robinet said.