IHS: Japan Quake May Cut Global Auto Output About 30%

Parts shortages caused by Japan’s record earthquake may reduce global automobile production by about 30 percent, research firm IHS Automotive said today.

If parts plants affected by the quake don’t return to operation within six weeks, global auto output may drop as much as 100,000 vehicles a day, said Michael Robinet, vice president of Lexington, Massachusetts-based IHS. The industry produces 280,000 to 300,000 vehicles daily, he said.

“Most vehicle manufacturers will be affected by this,” Robinet said in a telephone interview. “It will be very difficult for any major automaker to escape this disaster.”

Auto executives have refrained from forecasting lost production as their managers seek other sources for parts. If solutions aren’t found soon, most major automakers will experience disruptions by mid-April because supply networks are intertwined, Robinet said.

Automakers and parts suppliers around the globe are girding for possible shortages of key parts, especially electronics and transmission components, Robinet said. If carmakers can’t find alternate sources of parts, or if plants don’t come on line in eight weeks, as much as 40 percent of daily production may be lost, he said.

Honda Motor Co., which said today it will extend closings at its two car-assembly factories until April 3, is one of the most exposed carmakers, Robinet said. The automaker has 110 suppliers located in the earthquake zone, and about 10 of them can’t say precisely how long it will take for them to recover, said Ed Miller, a spokesman.

Toyota Plants

Toyota Motor Corp., the world’s largest automaker, has shut down all assembly plants in Japan until at least March 26. The company said it will resume production of three hybrid models in Japan on March 28.

General Motors Co. has idled two compact-car plants in Europe and a pickup factory in Shreveport, Louisiana, because of parts shortages.

GM executives sent out a memo on March 18 asking employees to limit travel and expenses to only essential business. The move was a precautionary measure, said Sherrie Childers Arb, a spokeswoman.

Ford Motor Co. hasn’t had any disruptions yet, said Todd Nissen, a spokesman.

Automakers can make up for one week of lost production with about six weeks of overtime, Robinet said.