April 25, 2024

Toyota and Honda Are Rebounding After Quake

That is how many who sell Toyotas, Hondas and some other Asian brands spent the summer after the devastating earthquake and tsunami that struck Japan in March caused widespread production disruptions at plants around the world.

Seven months later, nearly all auto plants have resumed full operation, with most running overtime to compensate for the output they lost. But carmakers say it will take until early next year for their dealers to be fully restocked and sales back to normal.

“This was something we’ve never seen before and hopefully never face again,” said Michael Robinet, an analyst with the research firm IHS Automotive.

August was the first month since the disaster that Toyota and Honda dealerships received more cars and trucks than they sold, according to Edmunds

.com, a Web site that tracks the auto industry. Toyota said all of its plants were back to full operation as of September, two to three months ahead of its initial estimates.

Still, getting vehicles from plants in Japan to American dealerships takes more than a month, and even models made at plants in the United States or Canada can spend several weeks in transit, depending on their destination.

“We’ve got a ways to go,” said Mike Shum, the general manager of Toyota Sunnyvale, a large dealership in California whose sales and inventories have been cut in half since the earthquake. “I don’t have them all on the ground yet, but I can see them coming.”

In late September, when Toyota introduced a redesigned version of the Camry midsize sedan, the Sunnyvale store had just eight of the cars in stock, including the outgoing model. Normally, it stocks about 150 Camrys.

The dealership has lost at least 1,000 sales this year because of the supply shortages, Mr. Shum said. It was sold out of the Prius, a hybrid car made in Japan, for much of the summer, though truckloads have been arriving much more frequently in recent weeks.

“Our flow of products, as we speak, is very good,” Robert S. Carter, Toyota’s vice president for United States sales, said. “It was nothing short of a miracle to get the supply chain back up and running, as complex as it is.”

The disruptions mean Toyota is all but guaranteed to lose its crown as the world’s largest automaker for 2011. In the first half of the year, it fell to third place, behind General Motors and Volkswagen.

In a year when high gas prices and increased demand for fuel-efficient vehicles could have brought big gains for Toyota and Honda, their inability to keep dealerships adequately stocked made them the only major automakers whose sales declined in 2011.

They are hoping to make up some of those lost sales in the coming months, but Mr. Carter, while promising a “very significant marketing effort” in the fourth quarter to draw shoppers back in, acknowledged that Toyota would inevitably sell fewer vehicles this year than last.

The quake halted a string of record-setting sales numbers by the smaller automaker Subaru, owned by Japan’s Fuji Heavy Industries. Subaru had to limit output in Japan and at its plant in Indiana, but inventories began rising again in September.

Nissan experienced some disruptions but was not affected as severely as Toyota and Honda. In August, Nissan began highlighting its quicker recovery in a television commercial that showed a fully loaded car carrier passing an exasperated Honda salesman who had no customers.

“Unlike some car companies, Nissan is running at 100 percent,” the ad’s voiceover said, “which means the most innovative cars are also the most available cars.”

Honda was hard hit because it has two major plants on the edge of the quake zone, and many of its suppliers sustained damage or had to evacuate because of radiation concerns. The company delayed the introduction of a revamped CR-V crossover vehicle, and it struggled to build enough of its redesigned Civic compact because dealers already had sold most inventory of the outgoing version.

Article source: http://www.nytimes.com/2011/10/14/automobiles/toyota-and-honda-are-rebounding-after-quake.html?partner=rss&emc=rss