BANGKOK--Honda Motor Co. resumed production in Thailand on March 26 at a "lucky" time after recovering from serious damage from last fall's massive flooding.
At 9:09 a.m., a production line started operating at its plant in Ayutthaya province, north of Bangkok, for the first time in five-and-a-half months.
Thais consider nine a lucky number because its pronunciation is the same as the word for “advance.”
Honda has a good reason to be anxious. The factory was inundated with two meters of water in last autumn’s flooding. It suffered particularly severe damage, forcing the longest recovery period among Japanese carmakers in Thailand.
Honda replaced 85 percent of its swamped pieces of equipment, including welding and press machines, with new ones, and repaired the remaining 15 percent. It also repainted the factory's interior floors and walls.
Honda “will continue production at this plant, but is considering building a new one on higher ground,” said Nobuyuki Shibaike, head of the plant. He said the company is seeking a possible new site. It is expected to take at least three years from land acquisition until the start of operations of a new plant.
In preparation for possible future floods, the company moved the main control device for the plant's power to a higher place. But risks still remain that a halt of the logistics system would cause another shutdown.
The restart of the plant, which now looks like a new one, began with the production of the Jazz subcompact--sold as the Fit in Japan--and the City. Larger models, such as the Civic and the Accord, will follow. But Honda said the production of engines and some other operations will not be restored until July at the earliest.
The flood halted supplies from local parts factories, affecting Honda plants around the world. Honda was forced to cut production by 260,000 units worldwide for this fiscal year, which will help push down annual operating profits by 110 billion yen ($1.33 billion). The company has spent 25.6 billion yen to repair its Thai plant.
Honda will make the policy change of procuring special parts from more than one makers in principle, even if that brings about higher costs. Honda also plans to ask its suppliers to manufacture parts both in and outside Thailand.
(This article was written by Daisuke Furuta and Kaname Kakuta.)
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