Toyota, other major Japanese firms hit by quake damage, supply disruptions

Sun Apr 17, 2016 9:40am EDT
 
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By Naomi Tajitsu and Makiko Yamazaki

TOKYO (Reuters) - Toyota Motor Corp (7203.T: Quote), the world's biggest-selling automaker, said on Sunday it would suspend much of its production at plants across Japan this week after earthquakes in the country's south led to a shortage of parts, while some other manufacturers extended stoppages due to damage to factories.

The earthquakes on Thursday and Saturday, which killed at least 41 people, reflected the vulnerability of Japanese companies to supply chain disruptions caused by natural disasters, and also highlighted the "just in time" philosophy pioneered by Toyota and followed by many others.

Companies had made efforts to address these problems after a 2011 earthquake and tsunami, which led to a nuclear disaster and nearly 20,000 deaths, badly dented output. The way that companies deal with the impact of the latest quakes will likely show how robust these changes have been.

Honda Motor Co. (7267.T: Quote) said it would keep production suspended at its motorcycle plant near the quake-hit city of Kumamoto in southern Japan through Friday, though Nissan Motor Co (7201.T: Quote) said it would resume operations at its plants north of the epicenter from Monday.

Electronics giant Sony Corp (6758.T: Quote) said production would remain halted at its image sensor plant in Kumamoto, as the electronics giant assessed structural and equipment damage. But the company said it had resumed full operations at its plants in nearby Nagasaki and Oita which also produce the sensors - used in smartphone cameras, including Apple Inc's (AAPL.O: Quote) iPhone.

Also on Sunday, semiconductor manufacturer Renesas Electronics Corp 6723.T confirmed it had sustained damage to some equipment at its plant in Kumamoto which produces microcontroller chips for automobiles. Having suspended operations following the first earthquake on Thursday, the chipmaker said it would assess damage at the entire facility before deciding when to resume production.

STICKING TO "LEAN" PRODUCTION   Continued...

 
The logo of Toyota is pictured at at the 37th Bangkok International Motor Show in Bangkok, Thailand, March 22, 2016. REUTERS/Chaiwat Subprasom