Japan Earthquake Keeps Hitting: GM Closes Another Plant
GM is halting some production at its Tonawanda in Buffalo, New York due to the spreading effects of parts supply shortages. Last week, GM announced that it would be closing a plant in Sheveport, Louisiana responsible for building two pickup trucks: the Chevy Colorado (pictured) and the GMC Canyon. The reason for that shutdown was delays in parts shipments from Japan.
While the Buffalo plant has more than enough parts for the time being, the plant was directly affected by the Shreveport shutdown. Tonawanda is responsible for building four- and five-cylinder engines for use in the two pickups built in Louisiana. And with production idle down there, there's no reason to keep pumping out the engines.
GM laid off 59 out of the Buffalo plant's 623 workers. Workers will continue to get about 75 percent of their pay while laid off. The New York lay offs join 800 lay offs in Louisiana.
GM doesn't know when it will resume normal production at either plant.
The GM story is the latest in a string of production stoppages and slowdowns that have come as a result of the natural disasters in Japan. With the average vehicle relying on thousands of parts to create the whole, and many of those parts coming from Japanese manufacturers affected directly by the events of earlier this month, automakers in Japan and across the world are feeling the effects. Full recovery of Japan's auto-manufacturing infrastructure could take months or years, leaving an uncertain future.
Neither Chrysler or Ford have had to alter their operations, but both companies are watching the situation anxiously.
Via AP (Wall Street Journal)