Earthquake in Japan hits the automotive industry: Toyota and Mitsubishi suspend production

Toyota, Nissan, Mitsubishi, and Daihatsu have suspended production at several plants following the earthquake that occurred five days ago, according to reports in Japanese media. The Japanese automotive industry is no stranger to natural disasters, which typically affect not only the car manufacturers themselves but also their suppliers. The earthquake struck last week in Kumamoto Prefecture, where several major car manufacturers concentrate their production activities.

In the automotive industry, the main challenge is not necessarily damage to the assembly plants themselves, as production lines can be relocated, but rather the disruption to the supply chain. Most car manufacturers operate on a just-in-time basis, where only a few hours pass from the moment a part arrives at the factory until it is installed in a vehicle. The supply chain and production lines are based on precise timing, so a shortage of any component, from a wiper to an entire engine, can lead to a production halt.

The Japanese automotive industry learned lessons from the Fukushima disaster and is now considered relatively flexible. Manufacturers keep stocks of parts in warehouses that are usually sufficient for two or three days. This is the main reason why reports of the plant shutdowns were published only now, even though the earthquake occurred last week.

At this stage, the effects of the earthquake are not felt in the Israeli car market. Among other things, this is because car importers in Israel hold stocks sufficient for several months, and shipments already on their way to Israel serve as an additional safety cushion.

According to reports from Japan:

Honda stopped motorcycle production in the affected area.
Toyota suspended operations at its plants in Tahara, Miyata, and Kanda, where models such as the Lexus GX, Lexus IS, Lexus NX, and the Toyota 4Runner, as well as engines, are produced.
Infiniti stopped production of the QX80, and Nissan suspended production of the Rogue.
Mitsubishi also announced a production halt at the company's plants in Mizushima.

Along with the car manufacturers, subcontractors were also affected. AISIN, considered one of the largest spare parts suppliers in the world, and chip manufacturer Renesas announced the shutdown of plants in the disaster area.