March 17, 2011
By NICK BUNKLEY
DETROIT — General Motors said Thursday that it would temporarily shut a truck plant in Louisiana because it could not get enough Japanese-made parts, the first in what analysts say could be widespread disruptions at auto plants in North America because of the earthquake, tsunami and nuclear crisis half a world away.
That it was G.M. — rather than one of the Japanese automakers, which depend on many parts from their home country — that succumbed first to the shortage shows how much the industry depends on far-flung suppliers. But Toyota and Honda have shut their plants in Japan until next week as they try to repair damaged facilities, assess the state of their suppliers and determine how to restart production safely.
“The modern auto industry has never faced a natural or human calamity on the scale of today’s crisis in Japan,” Michael Robinet, the director of global production forecasts for the research firm IHS Automotive, wrote in a report Thursday.
G.M. said its assembly plant in Shreveport, La., which makes a pair of compact pickup truck models, would be closed for at least a week, starting Monday.
The company said it would resume operations there as soon as possible, but gave no estimated date for doing so.
“Like all global automakers, we will continue to follow the events in Japan closely to determine the business impact, working across the organization to maximize flexibility, supply the most critical operations and effectively manage cost,” G.M. said in a statement.
Production at Ford Motor has not been affected, but officials are still assessing the situation, Mark Fields, the president of Ford’s Americas division, said Thursday. “It’s literally an hour-by-hour, day-by-day type of thing that’s going to unfold,” he told reporters at an event to commemorate the start of production of the new Ford Focus compact car near Detroit. “We have to first understand what is the situation there, and then we’ll determine the appropriate actions that we need to take.”
So far, all auto plants in North America have stayed open despite the troubles in Japan, although Toyota and Subaru have canceled overtime shifts to slow production and avoid depleting part inventories.
In Japan, most plants remain closed. Mitsubishi began bringing plants back up Wednesday, and two Nissan plants in Kyushu restarted operations on Thursday, but Nissan was uncertain whether it could keep them running for more than a few days.
Toyota has said its Japanese plants would remain closed through at least Tuesday. Mr. Robinet said he expected the shutdowns across Japan to extend through the middle of next week, if not longer.
Each lost workday for the carmakers in Japan costs them a total of about 37,000 vehicles, Mr. Robinet said. He estimated a total loss of more than 285,000 vehicles, assuming most plants can be restarted within a week.
Every automaker faces slightly different circumstances. At Volvo, for example, about 10 percent of the parts come from 33 Japanese suppliers, seven of which were in the catastrophe area, including one on the edge of the nuclear security zone.
John Hoffecker, managing partner of AlixPartners, a consulting firm based in Detroit, said determining the viability of the supply base was extremely complicated and time-consuming. A plant that ships parts directly to a carmaker might have avoided physical damage, but it still cannot operate if a lower-tier supplier cannot fill orders.
An average vehicle has about 20,000 parts and depends on thousands of suppliers, and the sudden loss of any one could be enough to stop production, Mr. Hoffecker said.
“It’s a real scramble for everybody,” he said. “It could be a chemical plant that got hurt that supplies material to make plastic that goes into a door panel that goes to someone.”
For parts that are shipped by boat to North America, shortages could take about a month to materialize. But for lightweight, high-value parts like microchips that travel by plane, problems could crop up much faster.
G.M. declined to identify the parts in short supply at Shreveport or their manufacturer. A person with direct knowledge of the situation said just one part was involved and it was also used in other G.M. models built elsewhere in North America. G.M. is diverting parts that would have gone to Shreveport so it can continue building models that are more important or in shorter supply, said this person, who was not authorized to speak publicly about the matter and so spoke anonymously.
G.M. has more than two months’ worth of the Shreveport-made pickup trucks, the Chevrolet Colorado and the GMC Canyon, in its inventories, so halting their production is unlikely to hurt the company or its dealers in the short term. They are far less popular than G.M.’s full-size pickups, the Chevrolet Silverado and GMC Sierra; G.M. sold 32,634 Canyons and Colorados in 2010, down 26 percent from the previous year, compared with about 500,000 of its larger trucks.
In general, automakers do not reveal many details about their supplier network, and several declined to say this week how many of their parts come from Japan. John Fleming, Ford’s executive vice president for global manufacturing and labor affairs, said parts were imported from Japan for “a lot of our products,” without elaborating.
About 20 percent of the parts used by Hino Motors Manufacturing, a Japanese company that makes components for three Toyota models at a plant in Arkansas, come from Japan, according to Shinichi Sato, treasurer and secretary of Hino’s United States operations.
Liz Alderman contributed reporting from Paris, and Motoko Rich from Marion, Ark.
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