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Aftermath: Japanese earthquake and tsunami takes toll on car parts and production

Consumer Reports News: March 16, 2011 02:05 PM

Last week's devastating earthquake and tsunami has affected many Japanese automakers, but now we are learning more about the impact of the auto industry damage and the availability of parts and supplies needed to continue production of vehicles.

Since our blog on Monday, there have been a number of updates to the status of the plants. Honda will shut its plants down until March 20th, Suzuki until the 21st, and Toyota will halt production through March 22nd. Nissan will continue to shut down three plants until March 20th, and two more will resume production tomorrow and Friday. Operations after Saturday have not been decided. Two transmission plants have been damaged and operations are suspended at this time.

A number of Japanese automakers build a majority of their vehicles for the U.S market in North America, including Honda, Nissan, and Toyota. These automakers continue to have a comfortable supply, but certain popular vehicles such as the Toyota Prius still come from Japan. According to the Wall Street Journal, with gas prices spiking higher in the United States, the demand for the popular hybrid has escalated and some dealers are short on supply.

The car shortage could also have an effect on car prices especially those that are built in Japan and sold here. According to Automotive News, Toyota has slowed down North American production to conserve parts until the company can finish assessing suppliers in Japan. As supply becomes constrained, incentives will likely diminish, giving other car companies a temporary market advantage.

There is still a great deal of uncertainty on the future availability of these Japanese vehicles and parts, as well as how competitors may respond. We'll be monitoring the situation in Japan and will report on any major changes and the affect on U.S. car buyers in the days and weeks ahead.

--Liza Barth

   

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