Earthquake Threatens Hybrid Car Rebound

In the aftermath of a devastating earthquake and tsunami that have crippled Japanese industry in recent days, carmakers around the world face possible shortages of key auto parts. Supplies of high-tech components like semiconductors, computer systems, and hybrid vehicle batteries have been most affected by the disruption. Still the center of the international hybrid market and manufacturing base, Japan produces not only the most popular gas-electric vehicles in the world, but also many of the battery packs and other components that go into competing international hybrids.

For hybrid carmakers, the supply disruption couldn’t come at a worse time. After a 2008 global economic downturn both softened sales across the industry and brought lower gas prices, hybrids have only now begun to make a comeback with consumers—due to a stabilizing economy and a recent spike in oil prices.

According to a survey by Automotive News, 74 percent of responding car dealers said their customers’ recent shopping habits had been affected by rising gas prices with 51 percent saying that buyers had begun favoring better fuel efficiency across all vehicle segments.

Toyota and Honda Plants Remain Inactive, But Seem to Have Escaped Serious Damage

Of the top ten hybrid models in the United States right now, seven are produced by Japanese carmakers. The others rely on parts imported from the country. The Toyota Prius has dominated the market since its inception—typically beating U.S. sales of all of its challengers combined—so the first question for hybrid watchers is whether or not waiting lists will return to 2008 levels.

The good news is that Toyota’s factories seem to have all escaped major structural damage and should be capable of going back online soon. Toyota’s nickel metal hydride battery supplier, Primearth EV Energy, is now also reported to be okay despite early reports that had its Miyagi factory sustaining major damage. The carmaker says it will provide an update today about possible timelines for reopening its domestic facilities.

Honda, which is mourning the loss of an employee due to the collapse of a wall at one of its R&D facilities, announced that most of its plants will remained closed until March 20. One of the affected factories is the Suzuka plant, where the carmaker assembles its Honda Insight, Honda Civic Hybrid, and Honda CR-Z hybrid models. That plant was reportedly reopened briefly before Honda included it on the list of idled plants, so there’s a strong that chance the damage there could be minor.

Other Hybrid Makers Are Also Affected

One of the more widely used photos in coverage surrounding the earthquake features roughly 1,300 Infiniti vehicles destroyed by tsunami while awaiting shipment to the United States at the port of Hitachi. Included in those vehicles was the new Infiniti M35h, a hybrid version of which was scheduled to launch in North America this spring. Infiniti hasn’t yet released any information about whether the M hybrid was among the cars in the shipment, but parent company Nissan has temporarily closed at least six of its facilities and says delays in getting out several Infiniti models should be expected. Will the release date of the M hybrid be pushed back as a result of the earthquake? The Nissan Altima Hybrid, sold in eight states, is produced in Nissan’s Smyrna, Tenn. plant.

The earthquake has also disrupted production of the all-electric Nissan LEAF, although the long-term effects are still unknown.

Ford says it’s also worried about a threat to its hybrid lineup, which includes three of the more popular gas-electric models in the United States: the Fusion Hybrid, Escape Hybrid, and simply weren’t enough to go around.


  • Anonymous

    They will fix the plants and start manufacturing. If the country is so quake-prone, why not they shift some of the manufacturing to US where 1/3 the hybrids were sold.

    In another note, there is only 10,000 Prius in inventory all over USA, so if you are planning to buy 1, please rush in before gas prices increase.

  • Anonymous

    likely because the market demand at the time (2008) can’t support two prius plants?

    ps please don’t start any fear mongering…

  • Anonymous

    ” If the country is so quake-prone, why not they shift some of the manufacturing to US where 1/3 the hybrids were sold.”

    There were quite a number of ‘memorable’ quakes in California in the last few decades. Last time I checked, I didn’t see any mass exodus.
    I have seen documentaries talking about the risk of tsunami reaching the East coast. (Some say archaeological records show it happened before.) There are tornado alley in the Midwest and hurricanes for the gulf states and the Atlantic coast. Which place is truly ‘risk-free’?

  • Anonymous

    From the article: “Primearth EV Energy, is now also reported to be okay despite early reports that had its Miyagi factory sustaining major damage.”
    The report linked is from Mar 11. It says: “Primearth EV Energy Co Ltd, [...], said its Miyagi battery factory had halted production because of power cuts. The extent of any damage was not clear, but a spokesman said it did not appear to be major.”

    Mar 15 media report: “the temblor did damage a battery-making line at a plant operated by Primearth EV Energy Co. [...] That factory, filled with sensitive high-tech equipment, makes nickel-metal hydride batteries for various Toyota gasoline-electric hybrids.
    It was still unclear how much repair work is needed or when the plants would come online.
    Other Toyota plants throughout the country were in operating condition, including another nickel-metal hydride battery factory run by Primearth EV Energy in central Japan.”

  • Anonymous

    “… there is only 10,000 Prius in inventory all over USA, so if you are planning to buy 1, please rush in before gas prices increase.”

    Do you sell Toyota?

    According to Toyota, ‘Toyota Motor Corp. said today inventory at U.S. dealers remains at a “normal” level’.

  • Kevin Foulds

    This is really bad news for the hybrid car market and for hydrogen fuel cell cars. This has got to be the worlds worst desaster as the power plants are now in such a dangerous state it is highly unlikely that they will ever be able to use this ground again. Japan is at the forefront of hydrogen fuel cell technology and this is unbelievable setback for a cleaner and cheaper alternative fuel.

    It seems like we are destined to use very expensive diesel fuel that can only go higher again, in a world were costs of this type of material just keeps going up. This has happened at a time when it looked like the whole motor industry was prepared to invest billions into hydrogen fuel technology.

    I only hope that this country which is known for being a working country can turn this around as soon as possible and get back on its feet again.

  • Old Man Crowder

    Is this REALLY a big worry? How many hybrid Toyotas and Hondas America will lose out on because half of Japan is under water, cities destroyed and the country facing a nuclear disaster??

    Tens of thousands, if not hundreds of thousands, of people have no shelter, food, water or electricity and you’re worried about your car.

    The selfish American ego of “What’s in it for me?” never ceases to amaze.

  • Anonymous

    “… there is only 10,000 Prius in inventory all over USA, so if you are planning to buy 1, please rush in before gas prices increase.”

    I believe you, for one reason or the other, underestimated the inventory. Besides those already in dealers lot, there are cars at the port, in the pipeline enroute to dealers and aboard ships from Japan.

  • Anonymous

    “Tens of thousands, if not hundreds of thousands, of people have no shelter, food, water or electricity and you’re worried about your car.”

    I respectfully disagree with your characterization. There are survivors in shelters like community centres, and school gyms. They have food supplies and water, though very limited. Are their situation great? No. But are they living without shelter, food or water? Not exactly.
    This is what happens when a country is facing a very severe natural disaster combined with a nuclear crisis.

  • Anon

    Even if the plants in the affected area are in tact and functional, we have to remember that the workers of those plants also have to be in tact and functional. If they have lost their houses or family members it will take a while for them to mend. Remember that earthquakes of this magnitude affect both buildings and people.

  • Old Man Crowder

    Well as long as they are in shelters, then I guess everything MUST be okay.

    Go ahead and resume your daily life.

  • Anonymous

    News flash: General Motors has just announced they are going to idle their Louisiana plant because of the crisis in Japan has so many parts plants closed…
    Yes your Chevy is a Japanese made vehicle too!

  • Yegor

    Japan Earthquake May Cause Prius Shortage

    http://www.time.com/time/business/article/0,8599,2059444,00.html

  • Anonymous

    From the Time article: “What’s more, American car manufactures say they too are concerned. Many rely on Japanese companies for parts, and it’s not clear when production and shipping will resume. [...]

    Toyota says it’s too early to tell whether it will face a shortage of Priuses. [...]

    At the beginning of March, Toyota had a 32-day supply, or roughly 18,000, of new Priuses on hand in the U.S., according to Autodata. More Priuses were shipped to the U.S. before the earthquake hit, but it’s not clear when Japan would be able to send more.”

    - However, I don’t think buyers should panic,
    - give it a few more months, things will settle down.

    P.S. It is interesting to note that barely one year ago, the market shifted to trucks and SUVs, and some hybrids including Prius were selling close to or below invoice. What a change.

  • tapra1

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  • solomon

    sorry 4 d loss