Automakers still reeling from Japan quake

Every major carmaker will feel the impact from the disaster, analysts say. Japanese automakers have been hit the hardest.

By Kim Peterson Mar 24, 2011 1:14PM
The earthquake and tsunami in Japan are still disrupting the auto industry worldwide, and it could be harder to find that car you want as a result.

Toyota (TM) says it will probably idle a truck plant in Texas because it can't get enough parts, according to Reuters. "It is likely that we will see some nonproduction days coming," a spokesman said. "At this point, we are still not sure of when those might hit or, if they do it, what the duration may be."

The entire sector is feeling aftershocks from the tragedy. Even American automakers are not immune, as they import parts from Japan. General Motors (GM) temporarily stopped production at a plant in Louisiana and laid off more than 50 workers at a plant in New York.

But the Japanese automakers are the hardest hit, with recovery efforts hampered by widespread power outages.

Post continues after video about Toyota and Honda production:

Toyota has closed all 18 of its plants in Japan through March 26 and said it could lose production of 140,000 vehicles in that time, Bloomberg reports. Analysts estimate the company is losing 6.5 billion yen a day.

Toyota builds cars in North America as well but still imports about 25% of the parts from Japan and other countries.

Honda is keeping two Japanese plants closed until at least April 3 and has said one key research center will take months to return to normal.

Smaller parts makers went offline as well. Nissan's chief executive estimated that 40 parts suppliers are still hampered. Honda says a third of the 110 parts suppliers it uses in Japan have suffered damage, The Orlando Sentinel reports.

Toyota is feeling intense pressure because its cars, particularly its new hybrids, are in high demand. The company is scrambling to restore production on three hybrid models -- the Prius, Lexus HS250h and Lexus CT200h -- by March 28, Bloomberg reports. But it's not clear whether Toyota is using its own parts or whether it must find another supplier.

And Nissan is desperate to resume production on the Leaf. It was able to resume operations Thursday at one plant in Japan and another factory that makes the car's battery, Reuters reports, but work could be affected by rolling blackouts.

Car buyers will feel the final impact from these production delays. Toyota said consumers might not find the specific color or trim level on some of its cars in the future, The New York Times reports. Analysts say the prices for Japanese cars are already climbing as well.

Car dealers aren't sure what to make of it all. Many say they have enough cars and parts to last several weeks. But after that? "I'm a little worried," the general manager of one Florida dealership told the Orlando Sentinel.
Tags: gm
64Comments
Mar 24, 2011 3:28PM
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Japan still won't allow US beef in their country because of one case of mad cow disease.  Its time to ban Japanese vehicles!  TOO MUCH RADIATION!
Mar 24, 2011 3:38PM
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This is why we need to get back to making things here in the U.S.A.
Mar 24, 2011 5:45PM
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Joe Smith started another day early. having set his alarm clock (made in Japan) for 6:00 a.m.  While his coffee pot (made in Japan) is perking, he puts his hair dryer (made in Taiwan) to work and shaves with his electric razor (made in Hong Kong). He puts on a dress shirt (made in Taiwan), his designer jeans (made in Singapore), and  a pair of tennis shoes (made in Korea).  After cooking up some breakfast in his new electric skillet (made in Philippines), he sits down to figure out on his calculator (made in mexico) how much he can spend today.  After setting his watch (made in Japan) to the radio (made in Hong Kong), he goes out, gets in his car (made in Japan), and goes looking, as he has been for a long time, for a good-paying American job.

Sound like anyone you know? 

Mar 24, 2011 5:37PM
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While the entire disaster is just that, a disaster, it is also a golden opportunity for others:
The carmakers need to contract their work out to others.  Many smaller machine shops in the US and elsewhere could greatly benefit from the opportunity to manufacture some parts for the Japanese car companies.  It would be welcomed work at a time when many need it, and there is no one doing it.  Even if it's just for a month, it would benefit everyone.

Mar 24, 2011 4:30PM
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When our government rewards corporations for sending our jobs over seas (tax breaks) and the corporations reward their CEO's for laying people off we get what we have, a lousy economy, high unemployment, and folks loosing their homes. BUT, all is not lost, the rich get richer, and that is what they want, all we are are labor and consumers to them.
Mar 24, 2011 6:08PM
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Maybe this is a wakeup call for the American public and Government.  Maybe we should start investing in making our own products and not relying on other countries.  One World, right!  It's One Stupidity, that what it should be called.  Japan, Germany, Switzerland and China do not use other countries to manufacture products.  We are the only idiots.  Japan, Germany and Switzerland employees make a good salary just like us.  If they can produce products in their country, with the salaries they are making, we should also be able to do the same..  Maybe the Government should invest in our companies to help modernize our factories, so we can make our own electronics.  Imagine a world war, and we have to wait on another country to make our parts.   
Mar 24, 2011 4:12PM
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Also need all parts made in the USA again as well NO more NAFTA   we import all export next to nothing but American jobs.

What does China and Japan import from us? (oh our technoliogy they steal) and we import all their junk this is not fair trade.

Mar 24, 2011 4:00PM
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The "Buy USA People" support American manufacturers.  Sure parts are made everywhere blah, blah, blah....but buying from an American company keeps the tax dollars, well...right here in America.  And for you "Tree Huggers" that think we should walk...well, if we had listened to Henry Ford back in the day, cars would have been running on 100% ethanol (grain). 
Mar 24, 2011 5:38PM
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maybe if they bring back the autoparts making to america we may be able to put a few people back to work,but noooo they want cheap labor ,detroit still got plants that are empty,and it doesn't have that many earthquakes....
Mar 24, 2011 3:47PM
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Well...now would be a fine time to buy an American car from an American car manufacturer...like a Ford!
Mar 24, 2011 4:01PM
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America used to be the world's biggest industrial giant in the mid-late 1800s and right up to the '50s.  After these Asian countries went communist/socialist we lost our position as the world's biggest and best.  JUST LOOK AT US!!!!  It's PATHETIC, how can something like this happen?!?!?!  We need to encourage education more, it all boils down to what our kids get on their report card and how qualified the person giving them out is.  If kids aren't getting the proper education they need, America's just getting worse. 
Mar 24, 2011 3:49PM
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Why do we feel sorry for Japanese automakers? They don't allow us to sell our goods over there. When you buy a Japanese car all the money goes back to Japan. We need jobs for Americans so we need to buy American goods. You think this sounds old school then think about it when your flipping hamburgers instead of having a real job.
Mar 24, 2011 5:17PM
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Maybe just maybe this will bring a wake up call to the American public to tell the Eco lovers to leave us build things in this country.  We used to have a strong economy from building things, now the Eco nuts stop us from building and make us dependent on buying things from overseas.
Mar 24, 2011 4:28PM
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It's hard to have faith in American managed automakers when they have to get on their hands and knees and beg congress (every single American taxpayer) to be bailed out.  All the while, that snake Gettlefinger is lining his pockets with YOUR MONEY!

It's great that everyone's so up in arms about this.  Maybe it will teach us that to compete, we actually have to quit this liberal, communist union nonsense and "force" assembly line workers to compete with assembly line workers around the world instead of making $50 an hour and retiring at age 50... Completely ridiculous.

Were we not so unionized, no one would give a crap because we'd pay what cars are actually worth on the world market, rather than an overpaid worker's retirement and health care funds.

 

I'll NEVER buy another American car until the tax payer money is paid back with interest!

Mar 24, 2011 5:23PM
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Well I just bought my Cadillac SRX and it is a GREAT vehicle. It is more than competitive with any crossover vehicle available, stylish, fuel effecient, and safe. Yeah the american auto industry was hit with fereign frenzy and were forced to finaly invest in new products and designs BUT to stupidly blame the workers for all the problems is stupid in itself. The workers didn't design the products or run the companies in the ground. Redundant models poor design corporate mismanagement were the main culprit along with americans willing to look at someone to blame for their problems. What is wrong with an american worker making a decent wage? We are bombarded with media blaming workers for the problems therefore pointing fingers at fellow workers instead of placing blame where it belongs, the fatcat CEO's making 200-300 times what the assembly line worker gets. As long as we continue blaming autoworkers, Teachers, Police officers, postal workers,state workers, federal employees and every other american worker making a decent wage we will continue to lower our standard of living. Soon we will be pointing our fingers at the OVER PAID auto worker at that Honda or Toyota assembly plant in the US. Wake up and realize all american workers deserve a decent wage or we will all be living in poverty.
Mar 24, 2011 3:57PM
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Mr. MikA offers up just one restriction of many that the Japanese government uses to protect their economy at others' (and our) expense.  Having lived and worked in Japan, I can state that the PC and political back door deals done between governments have little to do with the average Japanese or American worker, and more with politicians lining their pockets.  The US tries to do the same, but the results aren't as effective in 'protecting' because of all our out of control unions, which liberalism has perverted so that an assembly line auto worker can get $50.00/hour, and Still get bailed out by taxpayers when their companies can't compete. 
Mar 24, 2011 6:21PM
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I can't believe how gullible and naive so many people are when it comes to what they read in the media about UAW members.  They don't make $50 to $70 an hour.  That's the auto company executives being very misleading.  That figure comes from adding all compensation paid to current employees, which is around 390,000, and retirees, which is around 600,000 and then dividing up the total by the current employees alone.
UAW members make $16 an hour to start and go up to around $30 and hour with an average of $10 an hour in benefits. 
The labor cost of an American made car is around $800 higher than a car made in Japan.  Yet an American made car that's comparable to a Japanese made car costs an average of $2500 less.  That's because US auto company executives push inferior engineered cars and also use cheaper parts and materials to try and squeeze the most profits they can make so they get their huge bonuses.  So when Japanese cars sell better here, the executives blame it on the union workers when the real reason is it's their own decisions and greed that lead to the Japanese cars being better quality.  And even though they cost more, a lot of Americans don't mind paying a little more money to get a much better quality car. 
It's the same ruse that's been used before.  The executives screw up a company and they turn it around and blame the union workers for it.  It happened in the auto industry, the steel industry and a lot of manufacturing companies.   CEO's and the top executives of US auto companies make 300-400 times more than the average line worker.  In Japan the same type of executives make 5-10 times what the average line worker makes.  Who are the overpaid employees in America?  The line workers or management?
Japan also kills any chance of American vehicles being imported there.  I remember when the Jeep Grand Cherokee was first manufactured in the mid 1990's.  I read an article how there was a demand for it in Japan but there was a tariff on it which drove the price from around $25,000 to $40,000.  We should be doing the same thing here, especially on products made by an American company who closed up and moved their manufacturing out of the country.

Mar 24, 2011 5:05PM
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alot of you dont know squat about automobiles!!! the most american made car is a chrysler product and its only 78% american!!!!! take the time and look under the car,hood ,in the dash !!! you wont see much  MADE IN USA!!!! ALL AUTOMOBILE PLANTS WILL SUFFER FROM THIS!!! and now all americans will also suffer thanks to the fact we rely on there parts for all automobile companies!!!
Mar 24, 2011 6:26PM
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If Americans worried about America......then we'd be much better off.......!!!  Turn the tables and NO one cares about the United States..........so to "hell" to them.....!!!!
Mar 24, 2011 3:58PM
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these comments are so funny and typical!  Honda, Nissan, Hyundai all build 75% of there cars in the USA.. That means they pay americans to build those vechs.  They understand that we are the number 1 consumer of those cars and they brought the jobs to america for that reason.  I do not sell these cars either! Im just saying they employee more americans then most of the american name plates...
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