Thailand floods wreak havoc on world’s largest automotive manufacturers

 The Thailand Floods are wreaking havoc on some of the world’s largest automotive manufacturers, with Ford, Toyota and Michelin all suspending production due to supply chain volatility.

Supply chains are buckling under the pressure of the disaster, with effects moving to neighbouring areas including Japan, which is still recovering from the extreme loss caused by a tsunami and earthquakes earlier in the year.

According to a report from Wall Street Journal, Toyota has produced 17,000 fewer vehicles in its Thailand manufacturing plants than previously planned. The number of vehicles in total could reach 30,000, Toyota claims.

Ford, which has also suspended part of its Thai production, says it is working closely with its affected suppliers, and is trying to return to full production as quickly as possible, in an attempt to minimise the flow-on affects to other areas in the supply chain, according to the Wall Street Journal.

The report also says Michelin is shutting some manufacturing operations in areas deemed high-risk.

There are thousands of manufacturers in Thailand and the area plays a pivotal role in the global supply chain for cars, components, electronics, appliances and clothing.

The flooding will cost manufacturers millions of dollars, not only in Thailand, but in neighbouring countries like Australia and also further afield.

Australia’s automotive industry and any other manufacturers sourcing components from Thailand will be affected negatively while they wait for their stocks.

However, the situation could also be positive for Australia’s textiles, clothing and footwear manufacturers, as output from Thailand’s textiles industry will drop.

Image: sbs.com.au