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Japanese Automakers Shutdown To Deal With Earthquake

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On: Mon, Mar 14, 2011 at 5:15PM | By: Tim Healey

Japanese Automakers Shutdown To Deal With Earthquake

Due to complications from the aftermath of the severe earthquake that hit Japan last weekend, the seven largest Japanese automakers are shutting down for a few days.

There are several reasons for the shutdowns. The first centers around the human toll—automakers are giving their employees a chance to track down missing loved ones while regrouping with injured survivors.

There are also business concerns, as well. The quake has disrupted supply lines, and some suppliers who are based in the quake zone have been unreachable. Export shipments might be disrupted, as well, due to tsunamis that devastated ports after the quake.

Mazda, Honda, Nissan, Toyota, Mitsubishi, Subaru, and Suzuki all shutdown on Monday (Mazda operated for a half-day) and eventually suspended production until later in the week.

As an example, Honda will be shutdown at least until Sunday, March 20th, and it will lose production of 16,600 units, 2,500 of which would have been bound for the U.S. Honda has 113 suppliers in the quake zone and has been unable to get in touch with 44 of them.

The shutdowns could hurt production at U.S. plants operated by Japanese manufacturers, since parts need to be shipped overseas from Japan, especially large core parts like engines and transmissions.

Rolling blackouts and continuing aftershocks are also posing challenges to the Japanese automakers, who are also worried about damage to the plants themselves from the quake.

It's hard to tell how long production could be affected for or how it might affect new car sales and deliveries here in the States. Same goes for parts replacement for repairs. The logistical challenges remain immense. Some Nissans bound for export were destroyed by the tsunami at the Port of Hitachi, as just one example.

The production shutdowns make sense, given that Japan has bigger worries than automotive sales right now. With the death toll rising and lines of transportation and communication still disrupted, it was the most logical step.

For car buyers, it may mean waiting longer for ordered deliveries to arrive, and dealerships might find themselves waiting on inventory. Otherwise, the effects of the production shutdowns remain unclear, at best.

With all the difficulties facing Japan, this is yet one more challenge that has arisen because of the massive earthquake.

And it's far from the most important.

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Michigander | 11:01AM (Tue, Mar 15, 2011)

I know that the shutdowns could have residual effects on the dealer industry here in the states but at this particular moment I have a hard time caring. With so many lives lost, this really needs to be about the people and not the money. Giving their employees time off to regroup was definitely a good idea. I really hope they are paying everyone for these days off.

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