Supply chain bottleneck for world auto as every car uses some Japanese electronics

The world auto supply chain  has become so integrated (March 18, 2011) that you are likely to find the same parts suppliers supplying to all  auto plants. There was a time when Ford would frown at suppliers supplying to GM let alone Toyota. Today the world is a far different place , with suppliers supplying to everyone in their industry. In fact , you can be sure that suppliers who recently started supplying to the rejuvenated GM had to provide good references from other customers like Ford and Toyota.

[Note: This post from March 18,2011 was updated for formatting issues on May 22, 2021]

The Japanese earthquake crisis now reveals that  GM has to shut down plants in Europe and many more plants are likely to shut down across the auto industry. In the US, there are employment concerns with these possible shutdowns. Critical electronic parts, particularly in dashboards are supplied from Japan as this video suggests.  In addition, the entirely Japanese made hybrid Prius is likely to be in short supply.

The Japanese auto electronics industry clearly is able to compete worldwide, on both cost and quality for auto companies,  and good margins for the Japanese ancillary industry- who fly these parts to different auto plants.

Will the auto industry worldwide generally wait for parts supplies to resume from Japan? Generally yes, I would think because there is just too much knowledge and know-how involved to start making these parts at short notice.

That the  high cost Japanese auto electronics industry is able to sustain as a supplier to the world is sort of inspiring for all types of businesses in high cost locations.

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