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Posts Tagged ‘auto shortages’

Automakers Short of Capacity as US Market Rebounds

Paying the price for recession cutbacks.

by on Aug.08, 2013

Workers on the Toldeo line prep a new Jeep Cherokee.

Even with new plants coming on line in Mexico, the North American auto industry is rapidly running up against the limits of its capacity as manufacturers struggle to keep up with the demand for new vehicles.

But after losing billions in the run-up to the last recession, and then responding with massive factory cutbacks, automakers are reluctant to build capacity back up – only to find themselves in the same mess the next time the economy cools, analysts noted during the Center Automotive Research’s annual Management Briefing Seminar in Traverse City.

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“This is a very new space for the industry,” said Jeff Schuster,  senior vice president for forecasting for LMC Inc., who noted that with the memory of the Great Recession still fresh, manufacturers are wary of adding back new plants.


Automakers May Sidestep Resin Shortage

Meeting today could identify chemical alternatives.

by on Apr.30, 2012

A fire at the Evonik plant in Marl, Germany killed two and created a potential shortage of key resins.

What seemed, just last week, a crisis that could bring the global auto industry to its knees may actually turn out to be little more than an annoyance, or so industry leaders could learn today.

A late March explosion at a chemical plant in Germany left automakers scrambling when it appeared they might soon run out of a resin called PA-12 – alternately known as Nylon-12 – something with applications in everything from fuel tanks to seat fabrics.  The problem is that the German firm, Evonik, is the world’s largest producer of PA-12 and a precursor chemical that other manufacturers use to make the material.

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By mid-March some automotive suppliers were already warning of impending shortages – triggering emergency meetings around the globe, including one in Detroit that brought together more than 200 automotive executives charged with finding either new supplies or substitute materials.


Renesas Reboots

World’s largest auto chipmaker races to bring production back online months ahead of schedule.

by on Aug.29, 2011

Renesas is the single-largest supplier of automotive micro-controllers in the world.

In a matter of minutes, the earthquake and tsunami that struck Japan’s northeast coast, last March, took tens of thousands of lives and created hundreds of billions of dollars in devastation.  Few industries felt the impact more directly than the automotive world – parts shortages still plaguing many of the industry’s major manufacturers.

While the March 11 disaster had a wide-ranging impact, causing shortages of a variety of parts, including plastic and rubber goods, perhaps the biggest problem was a shortage of electronic components.  Among the manufacturers hardest hit by the quake was Renesas Electronics, the world’s largest supplier of micro-controllers.

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Renesas provides 40% of the chips used by the automotive industry, and without those silicon circuits carmakers like Toyota and Honda saw many of their assembly lines come to a screeching halt.

Bringing its operations – which center around multi-billion-dollar “clean room” facilities in the region hardest hit by the March disaster – hasn’t been easy, but in recent weeks Renesas has been ramping operations back up and plans to be back to full capacity next month, learned during a discussion with senior executives from the chipmaker.


Toyota Ups Production – And Prices

Japanese makers and dealers taking advantage of anticipated shortages.

by on Apr.15, 2011

The Lexus RX450h has jumped nearly $3,000 in price since the beginning of the year.

After taking a 10-day break for the annual “Golden Week” holiday, Toyota plans to get its Japanese plants back into production, it says, though at a rate well below normal.

According to various estimates, Japanese makers have already lost at least 500,000 units of production due to the disaster that struck the country on March 11, killing tens of thousands and devastating Japan’s industrial infrastructure.  Production has also been impacted at so-called “transplant” assembly lines in North America, Europe and other parts of the world, Toyota, for one, planning sharp cuts in U.S. operations.

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The anticipated shortage of Japanese-made product is translating into a big increase in what American car buyers are paying, especially for high-demand models, such as the Toyota Prius, according to various groups tracking dealer pricing.

“Lexus is one the brands that’s being heavily affected because there was already tight supply before the crisis and there’s no new shipment coming in the foreseeable future. The same can also be said for both Acura and Infinti but to a lesser extent,” noted analyst Jess Toprak, of