Toyota, Honda halt Thai production as floods disrupt supply chains

Toyota and Honda have temporarily suspended vehicle production at all their assembly plants in Thailand as severe flooding disrupts transport routes and prevents suppliers from delivering automotive parts.

The disruption to the automotive supply chain comes after days of heavy rainfall and flooding in several parts of the country, affecting key logistics routes and industrial areas.

Japan’s two major carmakers, Toyota Motor Thailand Co., Ltd. and Honda Automobile (Thailand) Co., Ltd., have temporarily halted their vehicle assembly operations as flooded roads disrupt the delivery of parts to production lines.

Honda halts production at Prachin Buri and Ayutthaya plants

Koji Iwanami, President and CEO of Honda Automobile (Thailand) Co., Ltd., said the company would temporarily suspend vehicle production at its Prachin Buri and Ayutthaya plants from October 2–6.

“The company has temporarily suspended vehicle production at the Prachin Buri and Ayutthaya plants from October 2 to 6 because parts suppliers have been unable to deliver components required for vehicle production after being affected by flooding, particularly in Chonburi and Rayong provinces,” Iwanami said.

Honda has also allowed employees affected by the flooding to take leave during the period to look after their safety and families and deal with damage to their property.

The company expects the impact on production of all vehicle models to be short-lived and plans to resume normal operations on October 7.

Once production restarts, Honda plans to introduce additional overtime shifts to recover output lost during the shutdown and fulfil customer orders as scheduled.

Toyota suspends operations at four plants

Toyota Motor Thailand has meanwhile temporarily suspended operations at its three main vehicle assembly plants — Samrong in Samut Prakan, and Ban Pho and Gateway in Chachoengsao — as well as a plant operated by affiliated company Toyota Auto Works Co., Ltd.

The disruption followed accumulated rainfall of more than 320 millimetres in just three days, leaving major transport routes heavily flooded and some roads impassable to smaller vehicles.

As a result, suppliers have been unable to deliver components to Toyota’s just-in-time (JIT) production system as scheduled, causing parts shortages. Some employees have also faced difficulties travelling to work.

Toyota said the shutdown was a temporary measure while transport routes are restored and did not represent a structural reduction in production capacity.

The company is assessing conditions with suppliers and preparing alternative transport routes so production can resume as soon as possible.

Industrial losses estimated at more than THB1 billion

Pimjai Leeissaranukul, Chairman of the Federation of Thai Industries (FTI), said flooding between September 24 and 30 affected Bangkok and 14 other provinces, with around 40% of FTI member businesses in affected areas reporting impacts.

According to the FTI’s preliminary assessment, losses to the automotive supply chain and related industries are estimated at no less than THB1.018 billion.

The estimate covers direct damage to machinery, electrical systems, raw materials, components and vehicles, as well as indirect losses caused by production stoppages, employees being unable to reach workplaces and lost business opportunities.

Industrial areas in Chonburi have been particularly affected.

However, the FTI said vehicle production could return to normal once drainage improves and conditions ease in key industrial and logistics areas.