Friday March 25th, 2011 11:41 The Earthquake in Japan and its Effect on Japanese Cars

The recent Japanese earthquake has caused substantial damage across the country. Economically, the disaster has caused many companies to halt or slow business and has left many without work for extended periods of time.

Perhaps most disturbingly, the car industry is being hit hard by the results of the Japanese earthquake. Japanese cars are some of the most prevalent in the auto industry and the disruption of engineering and production will surely cause lasting damage. Many prominent companies have closed their factories or temporarily stopped production. Many companies are attempting to repair factories and plants that have been physically damaged by the earthquake while others simply cannot maintain previous levels of production.

Japanese cars are second only to China in terms of manufacturing and prevalence. The damage to the industry will have lasting repercussions not only for Japan but also for other countries and the global economy as a whole. Monetary losses are already great, and the mounting damages may lead to economic devastation.

Many companies are still not open. Due to the massive disruption of the meticulous supply and demand structure, many others may only be able to restart production for limited periods of time and with limited staff.

This disruption of the supply chain also has lasting implications for the wider global market, as so many countries are inextricably tied to Japan and to each other. While the full extent of the damage is yet to be seen, it is undeniable that the Japanese earthquake and tsunami will have long-lasting effects on the Japanese economy and the world economy.

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