Toyota, Honda global output halved after quake

Japanese auto giants Toyota and Honda saw global production halved in April as the March 11 earthquake and tsunami ravaged supply chains, the companies said Friday. Honda reported a 52.9 percent year-on-year drop in worldwide production and an 81.0 percent slump in domestic output, while Toyota said global production was down 48.1 percent. The quake and the resulting tsunami shattered component supply chains and crippled electricity-generating facilities, including a nuclear power plant at the centre of an ongoing atomic emergency. Amid power and parts shortages, Toyota had announced production disruptions domestically and in the United States, Europe, China and Australia because of the crisis, temporarily slowing output or shutting plants. The company announced a year-on-year drop of 15.4 percent in its global sales figures for April. Honda, which was forced to temporarily suspend all production at its Japanese sites, said domestic sales were down 46.3 percent on year while exports dropped 76.2 percent. "The figures are pretty much along the lines of what we had expected. The months of March and April are the most severely hit by the disaster," Ryoichi Saito, an auto analyst at Mizuho Investors Securities, said. "In April, we saw auto plants operating for only about half the month, about half the capacity." Many component manufacturers that are key to auto production are based in the worst-hit regions of Japan, their facilities damaged by the 9.0 magnitude earthquake or inundated by the giant wave that followed. While most plants resumed production by mid-April, operations remain well below capacity and analysts warn parts shortages could go on for months, with the threat of summer power shortages also casting a shadow. Honda said it expected production volume in Asia and Oceania to start picking up in July, the carmaker's Asian Honda Motor Co. unit said. The company said in a statement it expects its production in Asia and Oceania "will be normalised during the August to September time period at almost all auto plants in the region", Dow Jones Newswires reported. The picture looked less gloomy for Nissan Motor Co., however, which makes up Japan's big three automakers alongside Toyota and Honda. The company said global production in April had decreased 22.4 percent on-year but announced a 4.4 percent rise in worldwide sales, marking an all-time record for the month of April. "Production is picking up earlier than expected, and I expect auto production will recover considerably in June," Saito told AFP. "Auto part makers for Toyota have also said their production will come to about 90 percent of what it should be by June. I'd say production bottomed out in April and will start recovering in May." Nissan plans to manufacture around 98,000 vehicles in Japan next month, the Nikkei daily said, nearly unchanged from the year-earlier 100,000 or so. And its projected June-November output of roughly 560,000 units is only slightly lower than the 590,000 units of a year earlier. Total domestic auto output in fiscal 2011 is on course to reach around eight million units, the report said, just 10 percent off the figure for 2010. The woes of Japan's automakers have been in stark contrast to overseas rivals. South Korea's Hyundai last month posted a 47 percent rise in first quarter net profit on higher prices and strong demand.