Manufacturers suspend production, tourism hit

A house in a residential area of Mashiki, Kumamoto, Japan, on April 15, 2016, followinga 7.1-magnitude earthquake.
A house in a residential area of Mashiki, Kumamoto, Japan, on April 15, 2016, followinga 7.1-magnitude earthquake. PHOTO: EPA

TOKYO • Toyota Motor yesterday said it would suspend production at plants across Japan after earthquakes in the country's south-west disrupted the automaker's supply chain, while other manufacturers extended stoppages due to damaged factories.

The quake-hit Kumamoto region on Japan's south-western Kyushu island is an important manufacturing hub and factories for companies including Sony, Nissan Motor, Mitsubishi Motors and Honda Motor have halted production as they assessed damage.

But Sony, which halted its image sensor plant in Kumamoto, said it had resumed full operations at its plants in nearby Nagasaki and Oita which also produce sensors used in smartphone cameras, including Apple Inc's iPhone, Reuters reported.

Toyota, the world's biggest-selling automaker last year, said a shortage of parts for doors and engines produced by its affiliates Aisin Kyushu and Aisin Kyushu Casting was contributing to a bottleneck in its supply chain. It was checking the status of damages at its other suppliers, the automaker said.

Other affected firms include Fujifilm, Renesas Electronics and Nippon Steel & Sumitomo Metal.

Air, road and rail services to and from the quake-hit region have been disrupted since last Thursday.

Bank of Japan governor Haruhiko Kuroda, speaking at a Group of 20 event in Washington, said it was too early to assess the economic impact but bank operations in Kumamoto were normal.

The US Geographical Survey estimated there was a 72 per cent likelihood of economic damage exceeding US$10 billion (S$13.6 billion), adding that it was too early to be specific. Major insurers have yet to release estimates.

The two powerful quakes have also brought tourism - one of the sluggish economy's few bright spots - to a standstill, the Nikkei Asian Review reported yesterday.

The Kyushu region has been gaining popularity among foreign tourists, particularly those from Asia.

According to the Kyushu District Transport Bureau, the number of foreign arrivals to Japan through the region grew 69 per cent last year to some 2.83 million.

South Koreans accounted for about 40 per cent of these arrivals, with a further 30 per cent coming from elsewhere in Asia.

At least 15 tourist accommodations have been damaged by the earthquakes. Several popular sightseeing spots in the region, including Kumamoto Castle, have also been damaged.

China's Ministry of Foreign Affairs last Saturday advised travellers to carefully deliberate before heading to the Kyushu region.

And Hana Tour, South Korea's leading travel agency, cancelled all Kyushu-bound tours beginning yesterday.

A version of this article appeared in the print edition of The Straits Times on April 18, 2016, with the headline 'Manufacturers suspend production, tourism hit'. Print Edition | Subscribe