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Toyota May Cut Production at North American Plants

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author photo by Autotrader March 2011

It’s been nearly two weeks since the earthquake and tsunami in Japan, but the devastation to the auto industry is just reaching our shores. Toyota announced that it is likely to cut production at North American plants due to supply chain disruptions. According to the manufacturer, resources are running thin, especially for rubber and electrical supplies.

CNN Money noted that all 13 of Toyota’s factories in the United States, Canada and Mexico have been informed. Mike Goss, a Toyota spokesman, said, “We expect some kind of interruptions.” However, he reiterated that this does not mean that the plants will stop working, but that they will ready in case the need arises.

Although Toyota had resumed some production in Japan as of March 17, the manufacturing was only for parts destined for service centers across Japan, not for new cars. According to Leftlane News, Toyota has not made a decision as to when to restart production at its 12 major vehicle assembly plants across Japan. But as recently as March 21, the company said they would restart exporting parts to assembly plants overseas, including those in North America.

Concerning the future, Goss pointed out that other North American production concerns could also face stoppages. Referencing the many suppliers that were damaged by the catastrophes on March 11, he said, “We’re not just talking about a few companies.”

“All automakers are just now figuring out who supplies every little part,” said Edmunds.com senior analyst Michelle Krebs. “The shortage of any one could shut down an assembly line. Toyota isn’t the only one vulnerable; virtually all major automakers have some risks.”

To point, on March 18 General Motors announced that they would stop production at their Shreveport, Louisiana assembly plant due to a parts shortage as a result of the natural disaster in Japan. The plant builds the GMC Canyon and Chevy Colorado pickup trucks. (GM also said that it has enough vehicles manufactured to meet consumer demand in the interim.)

As for other manufacturers in Japan, Honda has extended shutdowns by another week – two of its Japanese plants are closed through April 3. And Subaru has extended their shutdown through Monday, March 28.

On a more positive note, Toyota as announced that it would restart production of their hybrids on Monday, March 28.

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Toyota May Cut Production at North American Plants - Autotrader