Manufacturers scramble to cover parts shortages
Kai Ryssdal: It doesn’t really matter how much Japanese components cost or what currency you use to pay for them, if they’re not available.
That takes us to Shreveport, La., where General Motors has decided to close a pickup truck plant for at least the next week because it can’t get parts from its Japanese suppliers.
Honda, meanwhile, says it’s not going to start making cars again in Japan until at least next Wednesday. So it’s telling dealers here it won’t be filling any orders until further notice.
Marketplace’s Alisa Roth reports on the spreading industrial ripples of the earthquake.
Alisa Roth: GM is going to send parts that would’ve been used in Louisiana to plants where they’re more needed. Final assembly plants like these — where the vehicles actually roll off the lines — are at the very end of a long supply chain. And what’s happening in Japan is starting to disrupt it.
Kim Korth runs a consulting firm that works with auto parts makers. Most of her clients are in the middle of that chain.
Kim Korth: These companies are starting to get notifications from their suppliers that we’re going to be unable to ship to you for the next three to four weeks.
So the people who make components like a steering mechanism don’t have the parts to do their part.
Korth: When that starts happening, suppliers say, excuse me, I can’t ship to this assembly plant and pretty soon the assembly plant can’t assemble the vehicle because it doesn’t have enough parts.
The carmakers want to avoid having to shut down. Todd Nissen is a spokesman for Ford, which so far hasn’t stopped production. He says it is evaluating options almost by the hour.
Todd Nissen: You can look to see if that supplier can get needed parts from a different facility; is there capacity that an outside supplier might be able to shift?
And the corporate scramble isn’t just happening in the U.S. or Japan. Renault, the French carmaker, is cutting back production at a plant in South Korea. And GM’s Opel has scheduled two work stoppages next week at a facility in Spain.
I’m Alisa Roth for Marketplace.
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