- David Hort
Natural disasters hit Honda and Toyota hard
Floods in Thailand have cost Toyota 150,000 units of production over the past month and a half.
Having already been hit hard by the Japanese earthquake and tsunami, Toyota was returning to ‘near-normal levels’ of production when the floods hit its Thai supply lines last month.
The disruption has forced the manufacturer to cut production across the globe, resulting in an 18.5 per cent fall in profits in September.
The worst seems to be behind Toyota however, with three of its Thai plants returning to partial levels of production, helping its Japanese production lines return to ‘near-normal levels’.
It’s not the only manufacturer to be hit by the floods in Thailand. Honda has also been forced to delay the release of the new Civic by more than a month in the UK because of supply shortages caused by the floods.
That means the new Civic will not arrive in January as first planned, but mid-February instead because a number of suppliers have been forced to halt operations as they recover from the floods.
According to Dave Hodgetts, Honda UK’s managing director, the manufacturer is looking at ways to speed up the recovery: “We are looking at all possibilities and I understand divers have been sent into some places [in Thailand] to recover tooling so it can be relocated to other parts of the country and production restarted."
The knock on effect for the UK is that the manufacturer’s Swindon plant has been forced to slow production of the new Civic to a three-day week cycle, just when production was beginning to return to normal after the Japanese disasters.
The most recent setback could force Honda to relocate some of its parts suppliers, according to Hodgetts, who said:
“You cannot simply turn to someone else and ask them to make a part from scratch but I think we will be looking at the locations of some suppliers to consider if they are likely to be affected by such natural disasters and if so they will be encouraged to relocate."