Electricity supply problems in China's prosperous southern province of Guangdong have disrupted operations at a high-profile carmaking venture partly owned by Honda.

According to Reuters, Guangzhou Honda, a joint venture between Honda and Denway Motors, said that output had not been affected by a shift in its production schedule forced by the electricity shortage.

But the company reportedly said it had shut down operations on Fridays starting this month, and staff will work Sundays instead to avoid peak consumption hours - when it could have faced a potential blackout.

"We're also taking measures to save electricity, for example by switching office lights off during lunch," a spokesman for Guangzhou Honda told Reuters.

But he reportedly said the factory, which has ramped up capacity to meet heavy demand in China for Honda sedans and minivans, was still operating five days a week, 16 hours a day. Despite energy-saving measures, output levels should not be affected, he added.

Reuters said half of China is suffering power shortages as the country's economy grows in excess of 8%, and analysts say the situation is worsening in the country's thriving industrial areas near Shanghai and in Guangdong.

That problem has been one factor behind the country's decision to try and slow investment in power-intensive industries such as automobiles, steel and aluminium, the report added.

"We believe the current power shortage could provide two near-term challenges to Guangzhou Honda: The Sunday wage could generate overtime expenses, and there is some risk of further power shortages requiring a slowdown in actual production throughput," Goldman Sachs said in a recent report cited by Reuters.

The news agency said the government of Guangdong, home to the joint ventures of two of Japan's top three carmakers, has asked CLP Holdings in nearby Hong Kong to supply more power.

"Guangdong's demand has greatly increased, and for 2003 alone we supplied 40 percent more electricity to them than in 2002," CLP spokeswoman Jane Lau told Reuters, adding: "We are still in talks on additional supply."

In addition to plants now making Honda and Nissan cars, Toyota is setting up a joint venture engine plant with annual production capacity of 300,000 units in Guangdong, the report said, adding that Japanese steel-making giant JFE Holdings is also building a power-intensive plant in Guangzhou that could cost more than $US1 billion to make car steel.

But more electricity from Hong Kong is not guaranteed, Reuters noted, because a shortage of ships to carry coal, rising coal prices and record freight rates may force CLP, which buys most of its coal from Australia, to stop funnelling electricity to Guangdong.

According to the report, a Guangdong official said this month that CLP had said it might stop power sales to the province due to insufficient coal supply.