How floods affect Honda global output

Thai floods affect Honda’s global output



The impact of the flood that is continuing to disrupt manufacturing in Thailand has hit Hondas international production, with adjustments being applied this week across the globe, including all six of its plants in the US and Canada.


The Japanese carmaker sustained the most severe disruption with vehicle assembly suspended in Thailand and its supply chain impeded by component makers unable to maintain production. Nearly 200 supplier companies have had to close at the Rojana park in the badly affected Ayutthaya region.


Auto production will be at approximately 50% of the original plan through November 10th, said the US division of the company in a statement. Subsequent adjustments will be announced as they are determined, based on the parts supply situation.


Additional measures being taken to manage the available parts supply in the US include the cancellation of all Saturday overtime through November and a full production stoppage on November 11th.


The disruption is expected to last for several weeks and will also delay the planned December US launch of the by several weeks, with no alterative date yet announced.


While the vast majority of parts and materials used to produce Hondas US-made vehicles are purchased from suppliers in North America (87% in 2010), some critical electronic parts are sourced from Thailand. The carmaker said it was working closely with its suppliers in Thailand and throughout its global network to reestablish the flow of parts for the products made in North America.


American Honda year-to-date sales reached 958,000 in the first 10 months of the year, down 5% against last years figures, due in part to the impact of the earthquake in Japan in March this year. October was the companys best month since with sales down just 1% as the company reported that its US manufacturing facilities were finally up to full production before the latest crises hit the supply chain.


Honda Automobile (Thailand) suspended operations on October 4thand does not have a clear outlook for when production will resume because of the flooding of its assembly plant in the Rojana industrial park.


Thai Honda Manufacturing, which makes motorcycles and power products, has also suspended operations because of parts supply problems.


Other Honda plants in Asia have been making adjustments to production volumes or suspending production due to the limited supply of parts. In Japan, Hondas Suzuka and Saitama factories will begin production cutbacks on November 7th. Hondas UK facility is also reducing its weekly production volume.


The estimated loss of Hondas vehicle production in Thailand for the month is between 10,000 and 15,000 units. The total average monthly loss of vehicle production for the wider industry is estimated to be between 80,000-100,000 units.


Rival Toyota has also cut overtime at five of its Japanese assembly plants as it prepares for a possible shortage of parts imported from Thailand. The company expects to lose 6,000 units of Japanese output. Toyotas Thai plant in Chachoengsao has stopped production because of supply chain disruption in Ayutthaya and Pathumthani provinces, with up to three weeks of production expected. Estimated production losses are expected to be around 30,000-35,000 units for Toyota.


As with Toyota, Honda is looking at an increase in the stockpile of automotive parts and a revision of the in an effort to ensure it has enough stock for at least a month in the event of any future disruptions.


Following onfrom the impact to the supply chain that the Japanese earthquake caused, this latestnatural disasteralso means that carmakers are relying on tomeet increased production demandswhile facing challenges of low inventory. In a recent survey involving 50 supply chain managersconducted by Evolution Time Critical the company reveals that increased production in the wake of natural disasters is the cause for an increase in the need for emergency logistics services.


“The recent natural disasters have encouraged manufacturers and tier one suppliers to look deeper into their supply chains and companies who were once invisible to OEMs will now be on the radar,” said Evolution Time Critical’s managing director, Brad Brennan. “OEMs and tier ones are now geographically diversifying their supply chain, sourcing material from new suppliers to avoid losing the whole supply due to one localised issue. This diversification and upheaval naturally produces its own set of challenges.”


The Thai government is also taking measures to stem the impact of the floods with 350 pumping machines now distributed to help drain water from the industrial estates and plans

Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
The price is based on these factors:
Academic level
Number of pages
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more
Need assignment help? You can contact our live agent via WhatsApp using +1 718 717 2861

Feel free to ask questions, clarifications, or discounts available when placing an order.
  +1 718 717 2861           + 44 161 818 7126           [email protected]
  +1 718 717 2861         [email protected]