Honda stops production

Japanese car maker says it will halt output in the Philippines starting today due to parts shortages amid the floods in Thailand.

Honda Motor Co. plans to reduce production in the Philippines, Brazil and England because of parts shortages stemming from the floods in Thailand, Keitaro Yamamoto, a spokesman for the company, said by phone Wednesday.

Production will be cut in England this week and Brazil the following week, he said. In the Philippines, output will be halted starting today, he said. Honda had not decided when production will resume to normal, he said.

Honda Cars Philippines Inc. said it would issue a statement today. The Philippine unit of Honda last month said it was assessing the impact of the Thai floodings on local operations, especially the supply of vehicle imports from Thailand and the production of City and Civic in its Sta. Rosa, Laguna plant.

Honda Cars Philippines imports three Honda models from Thailand—CR-V, Accord and Jazz—for Philippine distribution. It manufactures the City and Civic in Laguna.

HCPI produced 13,000 units of Civic and City last year. A company official said 70 percent of the total sales of 16,600 units last year were completely knocked-down while 30 percent were completely built-up units.

HCPI has implemented a “yellow flag status” due to supply disruptions caused by the twin disasters in Japan in March this year.

Honda earlier said it would make efforts to overcome the temporary interruption and minimize the impact on Honda customers, dealers and associates.

Honda Motor Co., which made about 5 percent of all its cars in Thailand last year, said Tuesday its factories may be flooded until mid-December and the financial toll will be big enough for the company’s annual earnings guidance to be unreliable. The Tokyo-based company said it plans to cut output at six plants in the US and Canada by about half from Nov. 2 through Nov. 10 because of the floods in Thailand.

The floods in Thailand disrupted Honda’s automobile production at Honda Automobile (Thailand) Co. Ltd. in Ayutthaya, as well as motorcycle and power product production at Thai Honda Manufacturing Co. Ltd. in Bangkok.

Floods in Thailand, the biggest Southeast Asian manufacturing hub for Japanese auto-related companies, have led to a shortage of parts and idled production of Prius hybrids and Camry sedans at Toyota Motor Corp.’s plants southeast of Bangkok. That may lead the company to cut its full-year profit forecast when it announces second-quarter earnings Nov. 8, said Yuuki Sakurai, Tokyo-based president at Fukoku Capital Management. –Julito G. Rada, Bloomberg