West Coast labor dispute hampers Japanese automakers' US plants

Wed, Feb 18 2015

The ongoing labor dispute between the International Longshore and Warehouse Union and port owners along the West Coast is starting to affect more Japanese automakers building vehicles in the US.

The issue already forced Honda and Subaru to take the expensive option of airlifting some parts into the US weeks ago, and according to USA Today, Toyota and Nissan have begun doing so, as well. The choice hasn't been cheap, though, and Subaru's chief financial officer estimated that the decision cost around $60 million more per month than sending components by cargo ship.

The effects continue to radiate, according to USA Today, and shortages of some models are possible. Honda is slowing production at its factories in Ohio, Indiana and Canada because the automaker doesn't have enough transmissions and electronics for some vehicles. Toyota already cut back on overtime at some factories. Nissan has only seen a small effect from the issue, though, because of its local suppliers.

Dock workers and port owners have been negotiating on a new contract since last year, and the union has organized work slowdowns in response. According to USA Today, the automakers could move shipments to Canada or Mexico, but it would take longer for parts to arrive.

News Source: USA Today
Image Credit: Mark Ralston / AFP / Getty Images

Earnings/Financials
Plants/Manufacturing
UAW/Unions
Honda
Nissan
Subaru
Toyota
shipping
port
labor dispute

By Chris Bruce