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Honda plants to return to normal production after cuts due to Thailand flooding


November 28, 2011
By The Canadian Press

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Honda says it will ramp up production at its North American plants — including its major assembly operations in central Ontario — due to an improvement in the overall parts supply shortage caused by flooding in Thailand.

The automaker says all of its North American plants, including Honda in Alliston, just south of Barrie, will resume normal production by December 1.

“While the severe flooding in Thailand continues to have some impact to our parts supply, Honda has been working closely with its suppliers to fully re-establish the flow of parts for the products made in North America,” the company said in a statement.

Most of the parts and materials used to produce Honda and Acura automobiles sold in Canada are purchased from North American suppliers. However, Honda says a few critical electronic parts are sourced from Thailand and other regions of the world.

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Honda cut output at its six North American factories by 50 percent earlier this month due to the parts shortage.

In Canada, Honda has an engine plant and two assembly plants that employ about 4,600 people in Alliston, Ont.

Among Japan’s automakers, Honda Motor Co. was the worst hit by the Thai flooding — a disaster that arrived just as automakers were recovering from the production slide caused by the March 11 tsunami in northeastern Japan that wiped out parts suppliers.

Others such as Toyota Motor Corp. and Mitsubishi Motors Corp. have also suffered.

Toyota, which also scaled back production at its North American plants, was cautious in its outlook for the full financial year ending March 2012, citing uncertainties stemming from the Thai floods.

Toyota has assembly plants in Woodstock and Cambridge in southwestern Ontario.

Honda, which suffered a 56 percent drop in July-September quarterly profit, has not given an earnings forecast for the fiscal year through March 2012, acknowledging that the Thai flooding made that too difficult.

The disruptions have hit the Japanese auto sales in Canada this year as they struggle to maintain market share.