General Motors will shut down four of its North American assembly plants, which mostly focus on cars, not trucks nor SUVs, for two weeks.
The reason behind the idling of the facilities is a shortage of parts, due to the earthquakes that have recently struck Japan.
The plants that will be shut down are those in Spring Hill, Tennessee; Fairfax, Kansas; Lordstown, Ohio and the Oshawa Flex Assembly in Canada.
The facilities have more than 13,000 employees who are members of the United Auto Workers union, and are charged with manufacturing the Buick LaCrosse, Buick Regal, Cadillac XT5, Cadillac XTS, Chevrolet Cruze, Chevrolet Equinox, Chevrolet Impala, Chevrolet Malibu and GMC Acadia.
According to a company spokeswoman, GM will be closing the four plants to make sure that there is an adequate supply of parts in its manufacturing process. The shutdowns are proactive measures that the company is making as it assesses the impact of the Japan earthquakes on its supply chain.
GM believes that it will be able to make up for the lost production by the end of the year, with the shutdowns not expected to have any sort of effect on the production plan or financial results of the company for 2016.
Joseph Spak, an analyst for RBC Capital Markets, said that the temporary closure of the four plants could actually help GM, along with other car manufacturers that would do the same thing, as the levels of inventory have increased recently. However, there could be a negative impact felt by parts suppliers in the current quarter.
A 6.4 magnitude earthquake hit Kyushu, Japan, on April 14, killing nine people and causing injuries to hundreds. A second earthquake followed on April 16, even stronger at a magnitude of 7.3, killing at least 34 more people with about 1,500 injured or buried beneath collapsed structures.
