Production stalls after Japan quake

From trucks to electronics, supply-chain problems resulting from the disaster are surfacing worldwide.

By Kim Peterson Mar 18, 2011 1:41PM
Image: Man changing oil (© Ron Chapple/Getty Images/Getty Images)We're already seeing production problems around the world as a result of the Japan disaster.

General Motors (GM) became the first carmaker to suspend operations in the U.S. as a result of the earthquake. Starting Monday, it will close its plant in Shreveport, La., because it can't get enough parts from Japan.

That plant makes the Chevrolet Silverado and the GMC Canyon, according to Bloomberg. Analysts were surprised at how quickly GM reacted. "We didn't expect for this ripple to hit quite this fast for North American plants," said an analyst at IHS Automotive.

Toyota (TM) can't get parts either and has pulled the plug on overtime and holiday work at its 14 North American plants, according to Kyodo News. The plants have only about two weeks' worth of parts left.

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Toyota makes cars in the U.S. but gets about 20% of its parts from Japan. Toyota has also delayed the opening ceremony of its new India plant and has stopped allowing overtime for employees in Thailand.

Production problems aren't limited to the auto industry. The earthquake may cause supply shortages for the iPad 2 from Apple (AAPL), according to research firm iSuppli. The company has found five key parts of the iPad 2 that come from Japanese manufacturers, including the tablet's NAND flash memory, electronic compass, system battery and touch-screen overlay glass.

"Delivery of components from all of these companies is likely to be impacted at least to some degree by logistical issues now plaguing most Japanese industries in the quake zone," writes Andrew Rassweiler of iSuppli. The NAND devices in the iPad 2 are available from alternative sources in South Korea and the U.S., he adds.

But the electronic compasses and the touch-screen glass may be harder to replace, he writes.

Component prices have spiked since the earthquake, Information Week reports. Spot prices for NAND flash memory has jumped by 10%, and DRAM system memory prices are up as much as 7%.

Tags: gm
5Comments
Mar 18, 2011 6:06PM
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Time to wake up america. We should be producing all these products here, like we did decades ago, especially the american brands, apple, gm, etc. Wake up or make sure you have a good place to go and lots of food, water, firearms and ammo. We used to be a world superpower, now we are just a world super giver of everything we have. 192 countries in this world and we give aid to 150 of them on a regular basis. Take care of our own. It's tragic what has happened but we need to keep it here and get our economy right.
Mar 19, 2011 9:09AM
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IT IS SAD WHAT HAS HAPPEN TO THE JAPPAN BUT THIS IS A WAKE  UP CALL. A AM 61 I HAVE SEEN THIS HAPPEN ALL MY LIFE. WE NEED TO BE MORE SELF SUFFIECEN IN MORE WAYS THAN ONE WE NEED TO DO MORE FOR SELF HERE AT HOME THERE IS NO REASON TO HAVE UNEMPOLYMENT IN THIS COUNTRY. WE NEED TO WAKE UP TO THE HEAD LINES DRILL OWN OIL PRODUCE OUR OWN PRODUCTS AS WELL AS LEARNING LIVING WITH THE ENVIROMENT WE LIVE IN WE NEED TO TAKE CARE OF OUR SELF FIRST THEN HELP ONLY PEOPLE THAT ARE TRYING TO BE RIGHTOUS WE HAVE GONE TO FAR TO THE LEFT WING  NOW WE CAN MAKE A DIFFERENCE BY SHOWING BY TAKING CARE OF OUR SELFS THIS IS WHY THE US HAS PROBLEMS WITH A BUDGET PEOPLE NEED TO WORK TO PAY FOR  OUR COUNTRYS NEEDS WE NEED TO HELP OUR OWN FIRST
Mar 19, 2011 1:17PM
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We need to produce these products in this country, we would not be closing plants, global economy does not mean dependency on other countries for our industries to function. It is time that these products are produced in the USA  by US citizens.  Imagine the jobs that would be created and we would no longer be dependent on other countries to produce those products.  I feel for the Japanese people and the tragedy that has taken place.  The world community does need to come together and help the Japanese people deal with the aftermath and provide humanitarian aide.
Mar 19, 2011 12:29PM
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And they said we were too close to running out of food. This whole world is so interconnected that we are going to be seeing this more and more.
Mar 19, 2011 12:41PM
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People dont understand how important a global economy....if we made all of our own products....unemployemnt would go up 10% or more and the only jobs we would have is service. Japanese automakers employ as many if not more than the the little three automakers.

 

wake up america

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