No Breaks for Japanese Car Industry

Almost two months since the Tsunami hit the eastern seaboard of the mainland, much of Japan is still attempting to recover. The Japanese automotive industry is no exception to this situation. There’ve been massive power outages and lack of forward momentum on recovery given the fact that the long-term affects of the tsunami go far beyond the wholesale devastation. Japan has been struggling desperately to get the reactor at the Fukushima Nuclear power plant under control. This has resulted in a lack of power and energy to much of the area and Japan seems to be at a tipping point.

This isn’t welcome news for Japanese automakers struggling to combat the overwhelming circumstances they’re now faced with. Well over a month since the incident occurred, most of the factories are still halted. As the shut down continues, it’s crippling many of the largest companies’ ability to do business, not just in Japan, but also in other markets such as America. This leaves many to question as to why this is affecting the way other satellite companies are operating but the fact is that Japan is the main source of most of the parts and support for their own industry. A lot of car resellers in America, and other countries, are having trouble keeping up with demand and simply don’t have an adequate supply or parts and vehicles. Many simply don’t have the money to get a new car or afford the parts. Some have even had to use auto title loans to fix their vehicle.

Most production in the South of Japan has remained relatively unscathed for the current situation. They escaped much of the devastation but many of the senior importers have said that the overall damage to the vast Japanese infrastructure is likely to be more lasting and have more than just a regional impact. This seems to be a domino effect where so many missing gaps simply cannot support the weight of the whole.

Before the earthquake hit, Japan was, on average, producing thirty-seven thousand cars and trucks each day and more than half of that figure was exported to other markets. An estimated 14 percent of the core market produced worldwide was made right in Japan. All of the sudden that figure has shrunk to nearly zero. This gives the overall market some idea of how bad it is. Though this calamity has given a boost to other American car companies struggling to compete with Japan’s auto innovations, business shut down is bad for the overall world market. With the second largest car exporter in the world, right behind Germany, out of the game, Japan is just hoping that the chaos can get under control to alleviate an already overburdened country.

 

Published on April 27, 2011 in Misc

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