March 23, 2011 / 6:51 AM / 8 years ago

Parts for Toyota, Honda's south China JVs enough till mid-April

BEIJING, March 23 (Reuters) - Toyota Motor and Honda Motor car ventures in southern China have enough parts inventory to sustain normal production until the middle of next month, a senior Chinese executive said on Wednesday.

“The earthquake is having a big impact on Japanese automakers at home. But the impact on Guangzhou Toyota and Guangqi Honda are relatively limited as both ventures get most of the parts supply from China,” Zeng Qinghong, president of Guangzhou Automobile Group Co (GAC) , told analysts in Hong Kong.

“Flagship models such as Accord and Camry made at the ventures get 90-95 percent of their parts from China and we have enough inventory for imported parts till the middle of April,” Zeng said.

GAC and its Japanese partners may evaluate the option to get some help from Japanese suppliers in other markets, he added.

Jack Yeung, an auto analyst at BNP Paribas, said Guangzhou Auto would probably be affected by the earthquake because some of its components are sourced from Japan.

Toyota makes cars in China in partnership with GAC and FAW Group. Honda also has a manufacturing tie with Dongfeng Motor Group .

Unlike other foreign auto makers, the top Japanese manufacturers export their luxury cars to China rather than producing them locally. With Toyota, Honda and Nissan having shut all of their plants in Japan after the earthquake and tsunami, exports to China will suffer, at least temporarily.

A Toyota spokesman in China told Reuters its inventory for Lexus is enough to sustain sales for two months but declined to elaborate. Executives at Nissan Motor and Honda could not be reached.

GAC plans to seek a listing on the Shanghai stock exchange through a 5.23 billion yuan ($766 million) merger with GAC Changfeng Motor Co Ltd .

GAC will subsequently set up a 50-50 venture with Mitsubishi Motors Corp , a move seen to shore up GAC’s sport utility vehicle business, company executives said.

Mitsubishi currently has a small venture with Changfeng, with an annual capacity of 50,000 units. The capacity will be raised to 300,000 units eventually, company executives have said, without giving a time table.

Earlier, GAC set up a 5 billion yuan ($763 million)manufacturing venture with Fiat , making mid-sized cars.

The venture will start operations in July 2012, with a capacity of 140,000 units initially, rising to 250,000 units eventually, Zeng added. ($1 = 6.553 yuan)

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