Business / Corporate

Toyota, Honda suspend plants rattled by Kumamoto quake

Kyodo, Bloomberg

Toyota Motor Corp. and Honda Motor Co. were among companies that suspended operations Friday after a powerful earthquake struck Kyushu, damaging factories and supply chains.

Flights and trains were also disrupted after the magnitude-6.5 quake, which struck at around 9:26 p.m. on Thursday.

Companies operating in the region scrambled to grasp the extent of damage to their facilities and check that their employees were safe.

Honda suspended production at its motorcycle manufacturing plant in Ozu, Kumamoto.

“It will take time to resume operations,” said a Honda official.

Toyota Motor Kyushu Inc. suspended production at three factories in Fukuoka Prefecture on Friday morning. Two of them resumed operations later.

Tire maker Bridgestone Corp. suspended production at its Kumamoto plant.

Meanwhile, electronics makers are also inspecting equipment at facilities they operate in Kumamoto.

Sony Corp. was checking up on nearly 1,000 employees at its semiconductor plant in Kikuyo at the time of the quake.

Mitsubishi Electric Corp. was inspecting two factories, one in Koshi that makes semiconductors and another in Kikuchi, which makes liquid crystal displays. It told all workers to stay home.

Convenience store operators announced plans to dispatch relief supplies to Kumamoto.

FamilyMart Co., Lawson Inc. and Seven & i Holdings Co. are shipping bottles of water and food such as rice balls.

There was disruption on transport networks, with four flights canceled linking Kumamoto with Tokyo and Osaka. The flights were operated by All Nippon Airways Co. and Sola-seed Air Inc.

Japan Air Commuter Co., an affiliate of Japan Airlines Co., said it will fly between Kagoshima and Fukuoka as an emergency step as bullet train services were suspended in Kyushu.

A deadhead shinkansen train was derailed in Kumamoto. The Japan Transport Safety Board dispatched investigators to look into it.

The Kumamoto region had already been facing a downturn in business sentiment, including the tourist industry.

The Bank of Japan’s Kumamoto branch office this month reported in its local tankan survey of business sentiment that confidence among the area’s companies is likely to slump over the next few months, with pessimists set to outnumber optimists. The index will drop from 7 in March to minus 1 in June. Zero marks an even split on views.

Tourism is an important source of revenue for the prefecture, which draws travelers from home and abroad with its Kumamon mascot, a famous castle and Mt. Aso, one of the largest active volcanoes in the country. The castle’s stone walls were damaged by Thursday’s earthquake.

The tankan outlook for hotels and restaurants is forecast to decline to minus 11 in June, from zero in March, while for retailers the forecast drop is to 5 from 20.

The tertiary sector, which includes the retail and services industries, accounts for more than 70 percent of Kumamoto’s economic output, according to the prefectural government.

“Japan’s economy has weak growth momentum and remains in a fragile state with the absence of a powerful and sustained engine for growth,” said Yasunari Ueno, chief market economist at Mizuho Securities Co. in Tokyo. “Any unexpected powerful shock could push the nation into a recessionary phase.”

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