Honda, Subaru Airlifting Parts Over West Coast Port Labor Issues : Tech/Biz : Auto World News
Automakers like Honda Motor Co. and Fuj Heavy Industries Lt., which makes Subaru vehicles, have decided to start shipping some of their auto parts to the U.S. by air due to a labor dispute with West Coast ports that is delaying important deliveries.
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The two companies started the airlifts in January over concerns that stalled discussions with dockworkers and ship operators that could slow down deliveries enough that production could be affected, the companies said Thursday according to Bloomberg.
The head of the shippers' association is urging the unit to accept a new offer that includes 3 percent raises since slowdowns, which are union-led, could completely shut down the U.S. West Coast's 29 ports in five to 10 days.
Toyota has stopped overtime work at some of its North America plants due to the delays and is monitoring the "situation," Kayo Doi, a spokeswoman for the carmaker, said to Bloomberg.
Mitsuru Takahashi, chief financial officer of Subaru, said the switch to air delivery for parts could increase costs by 7 billion ($60 million) per month. Fuji Heavy raised its full-year profit forecast earlier this week, according to Bloomberg.
Honda spokesman Atsushi Ohara said this week that, so far, production hasn't been affect by the labor issue in the U.S. He couldn't say how much shipping costs will increase due to the shift to planes however.
Automakers aren't the only ones who have been affected by the slowdown at West Coast ports.
• north america • west coast • east coast • shut down • heavy industries