THAI FLOODS: Honda may change India parts sourcing
Honda India will substitute Japanese parts for Thai components, as will Honda Thailand (whose car plant was flooded), Toyota's three plants are shut until Saturday and it's business as usual at General Motors though Ford and Isuzu are also shut.
Honda's Indian unit told Dow Jones it has inventory of parts made in Thailand to last until the end of October.
"As of now, there is no impact. We have parts to last this month," a spokeswoman, who declined to be named, said by phone.
Honda Siel also uses parts from Japan as well as Malaysia for manufacturing its car models.
The spokeswoman said Honda Siel was constantly evaluating the situation arising out of the floods in Thailand.
The spokeswoman said that about 77% of the parts used in the City and Jazz models are sourced from suppliers in India, and more than 80% for the recently-introduced Brio hatchback.
The Thai unit said it was mulling sourcing parts supplies from Japan for automobile production in Thailand, after the severe flooding caused a supply chain disruption.
The has already decided to halt operations at its automobile and motorcycle plants in Thailand until Friday. Press photos have shown cars floating in floodwaters near the plant.
As Honda and its subcontractors are providing parts not only to Honda in Thailand but also to India, Honda is considering shifting sourcing of parts for production in India to imports from Japan and other countries, a spokesman told Dow Jones.
The spokesman said the company is still looking into the impact that the Thai flooding has had on production and the status of part inventories for production in India, although it doesn't expect any immediate negative impact.
The spokesman said Honda's local content in India stands at 80%-90%, so that automotive parts shipped from Thailand are only a portion of the 10%-20% of parts used in vehicles it is manufacturing in India. But he said the company would face an inability to roll out vehicles even if only one part is not available.
Toyota has said its Thai unit will continue to suspend production at three local plants through Saturday due to flood disruption.
Its three Toyota Motor Thailand plants have not been damaged by the flooding but are experiencing difficulty in getting supplies from flood-damaged parts makers.
Operations at the three plants have been suspended since Monday.
Toyota said it will continue to monitor the situation closely as it decides whether to resume operations at the three plants from 17 October.
General Motors, meanwhile, said its plant in Thailand's eastern province is operating as normal despite the massive floods that have affected many parts of the country.
"To date, there is limited effect on GM's suppliers and dealers. Our production is still on going," the local unit said in a statement.
The company is working very closely with its suppliers and dealers, assessing the situation on a daily basis, it said.
Dow Jones noted that Thailand, which is the regional assembly hub of many constructors and home to their suppliers, is facing its worst flooding in decades, with some 30 of 77 provinces inundated and more than 260 people dead. Several automakers have halted production at local facilities due mainly to supply chain disruptions.
Other automakers suspending operations include Ford and Isuzu. Both supply pickup trucks under various brands worldwide bar North America.