Toyota to temporarily halt production in Japan

updated 10:51 a.m. ET July 18, 2007

TOKYO - Japanese automakers, including No. 1 Toyota Motor Corp., called production halts Wednesday at factories in Japan because of quake damage at a major parts supplier.

The temporary closure of auto parts maker Riken Corp.’s plant at Kashiwazaki city, near the epicenter of Monday’s magnitude 6.8 quake, has forced Toyota, Nissan Motor Co. Mitsubishi Motors Corp. and Fuji Heavy Industries to scale back production.

Toyota, Japan’s top automaker, will stop production lines at a dozen factories centered in central Aichi prefecture Thursday afternoon and all day Friday, said Toyota spokesman Paul Nolasco.

The company will assess the situation at Riken, supplier of key transmission and engine parts to Toyota, before deciding whether to resume production on Monday, he said.

Nolasco said it was “too early to tell” whether the halt would affect deliveries to domestic and overseas dealers.

Tom Libby, J.D. Power and Associates’ senior director of industry analysis, said customers shouldn’t notice the shutdown because Toyota likely has sufficient inventory to cover a few days of lost production.

“I don’t think their inventory is that tight. I think they’ll be able to adjust and probably make up for it afterwards,” Libby said.

He said he was unsure of the impact if the shutdown lasts beyond the end of the week.

For now, it should have minimal impact on U.S. customers because Toyota has sufficient inventory on hand, said Mona Richard, a company spokeswoman in Detroit.

Toyota, which makes the top-selling Camry and other models in America, currently has no plans to increase U.S. production. The parts plant that caused the shutdown in Japan supplies only Japanese plants, Richard said.

Nissan Motor Co. said Wednesday it was also halting some production lines at two factories on the main island of Honshu for at least two days starting Friday because of supply delays from Riken.

But Nissan expected to quickly make up for any delays, said spokesman Yuichi Nakagawa.

Fuji Heavy, maker of Subaru cars, said earlier Wednesday it would stop production of its five mini car models because it is uncertain when it will receive its next shipment of piston rings from Riken.

Mitsubishi Motors also said it was stopping assembly at three plants later in the week for several days because it is unable to procure enough parts from Riken.

The problems at Riken were also threatening production at Honda Motor Co., the automaker’s president told public broadcaster NHK.

“If things don’t get better today, we’re going to stop, too,” Takeo Fukui said. “We are just able to hold out until the weekend,” he said.

Riken said in a statement it was rushing to fix the damage at its Kashiwazaki plant and hoped to get the factory online as soon as possible.

Still, fears of production delays at Japanese automakers drove share prices down in Tokyo on Wednesday.

Fuji Heavy shares fell 1.82 percent to 592 yen on the Tokyo Stock Exchange. Honda shares fell 0.66 percent to 4,490 yen.

Toyota lost 1.32 percent to 7,460 yen, and Nissan Motor Co. lost 0.53 percent to 1,313 yen.

Monday’s quake, which killed at least 9 people and caused a slew of problems at a nuclear power plant, has wreaked havoc on other companies with factories in the region.

Fuji Xerox Co. said Tuesday it had halted a printer plant damaged in the quake.

MORE FROM AUTOS

Autos Section Front

GM reports $1.2 billion third-quarter loss 37 percent of U.S. Saab dealerships to close Ford: New police cruiser to replace Crown Vic Automakers turn to safety to sell cars Texan drives $1 million car into marshes Dirtiest vehicles on America’s highways GM needs new Buick, Chevy entries to be hits IntelliDrive program blends technology, safety Chinese automaker aims to compete globally CEO lays out ambitious Chrysler road map Autos Section Front   Add Autos headlines to your news reader: