IHS Automotive predicts widespread disruption of car production by mid-April

Article by Christian A., on March 25, 2011

By the third week of April, the disruptions of the production of carmakers outside Japan may be more widespread as parts shortages get worse, according to a forecast by IHS Automotive. The report stated that global automobile production may be reduced by about 30% due to the shortages.

Last Wednesday, Toyota said that parts shortages will interrupt its assembly lines in North America soon. Toyota has resumed limited production of its hybrid vehicles in Japan but the bulk of its assembly plants remain suspended indefinitely. Meanwhile, Honda extended the shutdowns of its assembly plants in Japan from March 27 through at least April 3, says Autonews.

The Japanese suppliers sustained significant damage as a result of the Japan disaster and in the coming weeks, experts say that even non-Japanese automakers will feel the effects as parts in the pipeline are depleted.

Matteo Fini, principal analyst for Supplier Business, a division of IHS Global Insight, said that shipping the parts from Japanese suppliers to assembly plants in North America takes between two and seven weeks.

Fini said that problems may become more serious in North America and in Europe “when that production already in the logistics pipeline is over.” The auto components from Japan are being sold throughout the world.

The IHS report also stated that there is already a short supply of products such as electronic components, plastics and rubber and this might disrupt vehicle assembly plants outside of Japan. Fini also mentioned that a range of powertrain components are also sourced from Japan.

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