Japan supply chain issues emerge

Details are emerging of manufacturers facing disruption to their supply chain due to the earthquake in Japan.

Apple may be unable to source parts for its new iPad 2, a report suggests.

Sony Ericsson has already acknowledged that it will face similar problems with its mobile phones.

General Motors shut production at a truck plant in the US state of Louisiana on Thursday because of shortages, although research suggests the impact on carmakers may be limited.

Batteries and LCDs

Among the iPad parts threatened are its flash memory – used for audio and video storage – and its super-thin battery, which is produced exclusively by Apple Japan, according to a report by IHS iSuppli.

“Logistical disruptions may mean that Apple could have difficulties obtaining this battery, and it may not be able to secure supply from an external, non-Japanese source,” said the research group.

Affected iPad components may also include an in-built compass, DRAM memory and the glass overlaying the its touchscreen.

Other computer-makers may be hit by shortages of laptop batteries after Sony shut down five of its six factories in Japan.

Liquid crystal displays used in mobile phones and satellite navigation may also be in short supply.

Toshiba has shut one of its two LCD plants to recalibrate sensitive equipment knocked out of kilter by the earthquake, as has Hitachi with its Tokyo factory because of damage and power cuts.

“In the short term, there won’t be much impact,” said chief executive Yang Yuanqing of Lenovo. “We are more worried about the impact in the next quarter.”

The Chinese computer maker was not the only tech firm to flag up likely problems ahead.

“Although the full impact of the current situation on our business will take additional time to assess, Sony Ericsson anticipates disruption to its supply chain operations,” said the Swedish-Japanese joint venture in a statement.

‘Overdone’

Further problems are likely to emerge in the car industry, according to research by Nomura.

Nissan was likely to be hardest hit, said the Japanese investment bank, as a factory it owns in the earthquake zone supplies 12% of its engines.

Problems at the company are likely to spill over to Renault, because of the close business relationship between the two.

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However, Nomura said that the sharp sell-off in many car stocks earlier in the week had been “overdone”.

Although BMW, Daimler Peugeot, Fiat and Volkswagen were all identified as being affected, Nomura expected the impact on earnings to be as little as 3%.

General Motors remains the only car company outside Japan to have halted production, but it claimed that it had enough completed vehicles to meet two months of supply.

Meanwhile, Boeing’s Dreamliner is likely to be hit by yet more delays.

Jamco, which puts together the plane’s galleys in northwest Japan before shipping them out via Yokohama, said that while production facilities were sound, deliveries would be disrupted by fuel shortages.