GM to shut plant amid shortage of Japanese parts

By Ben Rooney, staff reporter


NEW YORK (CNNMoney) -- General Motors has suspended production at a facility in Louisiana due to a shortage of parts stemming from the natural disaster in Japan, the automaker said Thursday.

The Shreveport Assembly plant, where GM makes the Chevrolet Colorado and GMC Canyon, will be closed for the week of March 21, according to a statement.

GM (GM) said it will resume production at the plant "as soon as possible," adding that it currently has "sufficient vehicles to meet customer demand." All other GM plants in North America will continue to run as normal, the company said.

Tom Wilkinson, a GM spokesman, declined to specify which parts are in short supply. He said the automaker hopes to resume normal operations soon, but could not say when. "We're really evaluating the situation day by day," he said.

Japan was hit by a devastating tsunami on March 11 after one of the largest earthquakes ever recorded struck off the island nation's coastline.

While the disaster may not have a long-term impact on Japan's economy, many investors are worried about short-term supply disruptions of Japanese goods, including auto parts and technology components.

GM said it will continue to monitor the events in Japan to determine the "business impact." The automaker also said it will seek to maximize flexibility by supplying "the most critical operations," while working to "effectively manage cost."

Analysts at Nomura Securities, a Japanese investment bank, said the 20 auto parts suppliers they monitor have reported relatively minimal damage.

"However, some companies have problems with power supply and are also waiting for automakers [in Japan] to resume production," the analysts wrote in a research report. "As such, it remains to be seen when production will restart at auto suppliers."

On Wednesday, Toyota said that all 13 of its North American vehicle and engine plants are running normally.

The carmaker said that most of the parts and materials for its U.S.-based operations come from suppliers in the United States and Canada. "This helps insulate Toyota's North American plants from production interruptions in Japan," the company said.

However, Toyota said overtime has been curtailed at U.S. plants "to assure we maintain adequate inventories of parts that come from Japan."

Like GM, Toyota (TM) said its dealerships remain well stocked.

Honda (HMC), which has suffered damage at some facilities in Japan, said Thursday that its North American operations are currently not experiencing supply issues.

Todd Nissen, a spokesman for Ford Motor (F, Fortune 500), said the automaker has not yet experienced any production issues. "We continue to work with suppliers on a daily basis and monitor the situation," he said.  To top of page

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