Executive Briefings

Tianjin Automobile Supply Chain, Disrupted by Blasts, May Take Several Months to Recover

IHS Automotive estimates a production loss of 2,200 cars per day at Toyota's plants as a result of the recent explosions in China's Port of Tianjin.

Twin giant blasts there in have forced Toyota to halt production at two of its Chinese plants. Meanwhile, Mitsubishi said 600 of its vehicles could have been damaged as a result of the explosions. According to IHS Automotive estimates, Toyota produced a total of 432,340 units at the twin plants in 2014. It is estimated there will be a production loss of 2,200 cars per day at the automaker's plants.

Some automakers have started alternative route scheduling for vehicle shipments, while more are likely to do so going forward. It is expected to take couple of months before the port's operations revert to normal.

Apart from Corolla and Vios, the Crown Royal and Reiz sedans are the other models produced by Toyota at the Tianjin plants. While the current impact of the blasts is limited to the Corolla and Vios sedans, the Crown Royal and Reiz models are also likely to be affected going forward, according to Mark Fulthorpe, director, IHS Automotive light-vehicle production forecast.

Despite having a production plant in Tianjin, Toyota is among the least impacted automakers from the incident. The automaker has reported some damage to its research-and-development facility in Tianjin, while two dealer shops have also sustained damage. In comparison, Hyundai, Renault, and Volkswagen have witnessed greater damage of thousands of vehicles parked at stockyards.

Tianjin is one of the biggest automobile shipping ports in China and is widely used to ship vehicles within the country, especially to northern parts. The port is also used for exports and imports and accounts for about 40 percent of China's imported cars, the largest share of any port in the country. As such, the explosions are likely to affect vehicle imports in China. "The blast might impact 30,000 to 60,000 imports of one million total car imports for this year," said Lin Huaibin, manager, IHS Automotive China light-vehicle sales forecast.

Source: IHS Automotive

Twin giant blasts there in have forced Toyota to halt production at two of its Chinese plants. Meanwhile, Mitsubishi said 600 of its vehicles could have been damaged as a result of the explosions. According to IHS Automotive estimates, Toyota produced a total of 432,340 units at the twin plants in 2014. It is estimated there will be a production loss of 2,200 cars per day at the automaker's plants.

Some automakers have started alternative route scheduling for vehicle shipments, while more are likely to do so going forward. It is expected to take couple of months before the port's operations revert to normal.

Apart from Corolla and Vios, the Crown Royal and Reiz sedans are the other models produced by Toyota at the Tianjin plants. While the current impact of the blasts is limited to the Corolla and Vios sedans, the Crown Royal and Reiz models are also likely to be affected going forward, according to Mark Fulthorpe, director, IHS Automotive light-vehicle production forecast.

Despite having a production plant in Tianjin, Toyota is among the least impacted automakers from the incident. The automaker has reported some damage to its research-and-development facility in Tianjin, while two dealer shops have also sustained damage. In comparison, Hyundai, Renault, and Volkswagen have witnessed greater damage of thousands of vehicles parked at stockyards.

Tianjin is one of the biggest automobile shipping ports in China and is widely used to ship vehicles within the country, especially to northern parts. The port is also used for exports and imports and accounts for about 40 percent of China's imported cars, the largest share of any port in the country. As such, the explosions are likely to affect vehicle imports in China. "The blast might impact 30,000 to 60,000 imports of one million total car imports for this year," said Lin Huaibin, manager, IHS Automotive China light-vehicle sales forecast.

Source: IHS Automotive