Japan's three largest carmakers have been hit by a components shortage that has affected their operations at home and abroad after the disaster
Nissan will halt production at its Sunderland plant for three days as the Japanese carmarker joins its compatriots Honda and Toyota in reducing its British operations in the aftermath of the Japan earthquake.
Japan's three largest carmakers have been hit by a components shortage that has affected operations at home and abroad. Nissan employs 4,900 people at its north-east England factory, one of the most high-profile examples of foreign direct investment in the UK, where it makes the Juke, Note and Qashqai models.
Nissan said it would bring forward three non-production days scheduled for the second half of the year to 26, 27 and 28 of April. "Demand for all Sunderland-produced models remains high and once the normal delivery of components has been reestablished, the plant will work to recover any lost volume as quickly as possible," said Nissan, which made 423,000 cars at the plant last year and plans to make a similar number in 2011.
However, a spokesman for Nissan's Sunderland operations said there was a possibility of further pauses as its parent company continued to grapple with the aftermath of the earthquake, tsunami and crisis at the Fukushima power plant.
"All options are open," said the spokesman. "Over the coming weeks, hopefully we will get greater clarity and if we need to take further action then we will."
Honda has halved production at its Swindon plant while Toyota has banned overtime and scrapped three weekend shifts in response to the lack of components. The 3,000 workers at Honda will work two days a week until the end of next month while Toyota, the world's largest car manufacturer, had admitted there could be further disruption at its factories in Burnaston, Derbyshire, and in north Wales.
All three carmakers have reported shortages of electrical components such as microchips and semiconductors. Nissan said between 15% and 20% of its components are shipped in from Japan, where the earthquake and its aftermath has severely affected industrial production. In Japan, Toyota has already lost the equivalent of 260,000 vehicles due to a 20-day suspension at most of its domestic factories, while it has warned that its 14 plants in North America also face pauses in production. Shares in Toyota fell in the US on news of another serious earthquake in the region on Thursday, amid ongoing investor jitters over the speed at which the Japanese automotive industry can recover from last month's disaster.
Neil King, analyst at IHS Automotive, said non-Japanese automotive groups would also be affected. "I would imagine that virtually every carmaker sources something from Japan. It only takes one component to be missing and production is halted." He added: "Nissan is just the latest in a long list of downtime announcements from carmakers and there will be more to come. It is inevitable. Supplies are obviously running lower and lower on a daily basis." According to one industry rumour, uncertainties over the supply of Japanese-manufactured LCD screens, such as those used in satnavs, have become a concern for other carmakers.
The disruption to production is taking place against a backdrop of falling sales. Car sales fell by 7.9% in March, according to the Society of Motor Manufacturers and Traders, although the comparison with the same month last year is skewed by the government's successful scrappage scheme, which ended in March 2010. According to industry forecasts, 2011 sales are expected to decline by 5%.