Toyota resumes operations at half capacity

Employees of Toyota Motor Corporation work during the assembly process at the company's Takaoka Plant on December 2, 2005 in Toyota, Aichi Prefecture, Japan.

UPDATED REPORT

JEREMY HOBSON: There's word this morning that after a halt in car production following the earthquake and tsunami in Japan, things are about to start back up again. Both Toyota and Nissan are announcing plans to resume operations.

Marketplace's Gregory Warner joins us live with more. Hi Gregory.

GREGORY WARNER: Hi Jeremy.

HOBSON: So Toyota and Nissan both say they're going to open back up for production -- but only at half capacity.

WARNER: That's right. So if you figure a car has maybe 20,000 parts. Toyota (and Nissan) gets those parts from suppliers around Japan, and many of those supplies are still in crisis mode.

I called Hans Griemel, the Asia editor of Automotive News.

HANS GRIEMEL: I mean, last night for example here in Tokyo we had a big aftershock that sent blackouts across most of north eastern Japan. So that's a bunch of factories that were just knocked out of commission overnight.

And he says that's just the electricity problem -- there are gasoline shortages, road closures, other transportation problems that suppliers are dealing with.

HOBSON: And what does this mean for the global supply chain?

WARNER: It's good news if Toyota and Nissan can get their factories up and running. Even at half capacity it means they feel that parts are available.

But experts say that factories outside of Japan haven't yet felt the full impact of this parts shortage. They've been managing with back inventory. Stuff shipped before the earthquake. So if Toyota's at half capacity now and this shortfall continues, then factories in other countries could be at reduced capacity by later this month.

HOBSON

Marketplace's Gregory Warner, thanks.

WARNER: Thanks.


ORIGINAL REPORT

JEREMY HOBSON: After the earthquake and tsunami in Japan car production came to a halt. And this morning, there's word it's about to start back up again. Toyota says it will resume all operations -- but at half capacity -- on April 18th.

Marketplace's Gregory Warner reports.


GREGORY WARNER: In the end, it came down to just finding the parts. Toyota has hundreds of suppliers around Japan -- all dealing with logistical problems of their own.

HANS GRIEMEL: I mean last night for example here in Tokyo we had a big aftershock and it sent blackouts across most of north eastern Japan. So that's a bunch of factories that were just knocked out of commission overnight.

Hans Greimel is the Asia editor of Automotive News. Toyota suspended all production after the March 11th earthquake. Two weeks later, they put just two factories online. Toyota says it'll make cars at all 18 factories on April 18th. The stoppage and now slowdown will ripple out to other countries.

GRIEMEL: I think the global supply chain will be feeling the hangover of the Japan stoppage a little bit later.

Some reports say that Toyota will idle some American factories this month.

I'm Gregory Warner for Marketplace.

About the author

Gregory Warner is a senior reporter covering the economics and business of healthcare for the entire Marketplace portfolio.

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