Apr 18, 2016 08:06 AM EDT
Toyota, Nissan Halt Production In Japan After Earthquake Affects Supply Chains

The powerful earthquake that rocked Japan on Friday, April 15, 2016, has negatively affected several industries in the country. Toyota and Nissan were forced to stop production temporarily after the magnitude-7.0 earthquake damaged the factories of a key auto supplier.

A couple of factories of Aisin Seiki, the car supplier that creates body components and die-cast engine parts for Toyota, Nissan and Daihatsu, were damaged by the huge quake. Reportedly, windows and walls at the two plants were destroyed, which would require immediate fixing. In effect, the assembly lines of Toyota and Nissan were kept idle due to delays in the production of needed materials in the supply chain.

According to Jalopnik, the Miyata plant was forced to stop production for two whole days. The plant is responsible for building the Lexus IS, HS, ES, CT and RX for Toyota. April 15 and 16 work schedules at Miyata had to be halted by Toyota. Nearby engine and transmission factories also had to cease production at the moment because more time was required to look into the lower levels of the supply chain and guarantee that there will be no interruptions in the deliveries of needed sub-components.

As for Nisan, its Fukuoka factory will have to stop production temporarily due to the damaged Aisin Seiki factories. The Fukuoka is responsible for making the Nissan Rogue and Murano and was required to stop production on April 16.

Auto News cites that Nissan will have to make further evaluations on the current situation of their supplier to plan for operations beginning April 18 and beyond.

Over the weekend, more earthquakes were felt in Japan, including a magnitude-7.3 seismic activity that hit a manufacturing hub in the southern part of Japan.

Reuters says that the quakes have caused a drop of three percent in the Japanese share market. Factories for other manufacturing brands were also subsequently closed in the Kumamoto region, which was ravaged by the calamity.

According to Chief Cabinet Secretary YoshihideSuga, the Japanese government will exercise all the necessary measures to support businesses that were affected by the series of earthquakes, as well as the economy on a wider scale. The government may also tap into reserve funds to help affected industries. Toyota Motor Corp. was among the businesses that suffered huge drops. In the morning trade, Toyota went down by 6.8 percent on the sharemarket. Nissan Motor Co. and Honda Motor Co. also dropped over five percent, followed by minor improvements.

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