Toyota joins Ford, Honda in production slowdown

Published by rudy Date posted on April 14, 2011

AR assemblers have started shutting down their manufacturing operations as they grapple with a parts shortage resulting from the crisis in Japan.

The latest to announce a temporary production halt was dominant carmaker Toyota Motor Philippines Corp., which said it would have an extended Holy Week holiday break from April 16 to 24 because of a parts shortage.

In a text message Wednesday, Toyota vice president for corporate affairs Rommel Gutierrez confirmed that April 18 to 20 would be non-production days at its Laguna plant.

On Monday night, Toyota Motors Philippines president Michinobu Sugata acknowledged that Sendai, which was devastated by a tsunami in March, was a vital link in Toyota’s supply chain, and that its assembly plant there was operating at only half its capacity.

Sugata said the company’s Philippine subsidiary had adequate inventory of its completely built-up units, but dealers were running out of stock of Toyota’s fast-moving variants.

“I would like to apologize to our customers who will be inconvenienced by the delay in the delivery of their vehicles,” Sugata said.

Sugata and Gutierrez said the parts shortage was temporary, and that the company hoped to make up for the lost production days from July to September.

Toyota accounts for 38 percent of the domestic automotive market, according to the industry sales report furnished by the Chamber of Automotive Manufacturers of the Philippines Inc. in March.

Toyota has also suspended operations in its European and US plants as a result of the March 11 earthquake and tsunami in Japan.

Chamber president Elizabeth Lee said there would definitely be a slowdown in vehicle manufacturing as carmakers tried to make do with current inventories.

“There are things we need to consider. There are inventories in Japan that could not be transported because of logistics,” Lee said.

She said the various automakers were now trying to buy parts that would meet their standards from other countries.

“What is important is, we mitigate the gap for customers,” Lee said.

“It’s also for the benefit of the brand. Every day that a plant is shut down, the cost is billions for the brand.”

Ford Group Philippines had earlier announced it was suspending production in its Santa Rosa plant in Laguna for 18 working days up to May 9 to minimize the effects of the disaster in Japan.

Ford doesn’t have any production facilities in Japan but, like other automakers, buys parts from suppliers that were hurt by the earthquake and tsunami.

Ford has had to temporarily halt operations in the US and Europe because of shortages, but this was the first word of possible production cuts in Asia.

Ford has 13 plants in the Asia-Pacific region, including eight assembly plants in Australia, Thailand, Taiwan, Vietnam, India, China and the Philippines.

Ford is the country’s sole exporter of fully built vehicles, shipping out some 1,816 units to the rest of Southeast Asia the first quarter of the year.

Anika Wycoco, assistant vice president for communications of Ford Philippines, said the company was working with its suppliers and counterparts in the region daily to minimize any disruptions.

She said that despite the situation, the company did not see any major impact on its performance for the year.

Last week, Honda Cars Philippines Inc. said it was reducing its auto production by half indefinitely because of the difficulties in getting spare parts from Japan.

Honda’s plant in Santa Rosa produces about 15,000 vehicles a year, and mainly the City and Civic models. –Elaine R. Alanguilan and Dino Ray V. Directo III, Manila Times

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