NEWS

Global automakers divert shipments from China's Tianjin port after blasts

Thursday, Aug 20, 2015

Toyota Motor Corp and rival global automakers are looking to divert shipments to Shanghai and other ports from Tianjin after massive explosions last week disrupted operations indefinitely at China's largest auto import hub.

Authorities have restricted access to areas affected by the Aug. 12 blasts at a hazardous chemicals warehouse which killed at least 114 people. Automakers are struggling to reach lots and warehouses to assess damage and clear thousands of charred cars to make facilities usable, though the port continues to operate.

On Wednesday, Renault SA (RENA.PA) and Subaru maker Fuji Heavy Industries Ltd (7270.T) said they would re-route imports to Shanghai, while Hyundai Motor Co (005380.KS) said it would send further shipments to Shanghai and Guangzhou.

Toyota is considering re-routing imports to Shanghai and Dalian which have enough capacity to prevent any significant logistical problems, a senior Beijing-based executive said.

"Port of Tianjin will likely be unusable for a long while, although I have no idea at the moment how long these disruptions would last," said the executive, who was not authorised to speak with media on the matter and so declined to be identified.

Toyota suspended its two final assembly lines near Tianjin port on Monday to Wednesday, partly to assess any damage. It made 432,340 cars at the plants last year, and is likely to lose 2,200 a day due to the blasts, said researcher IHS Automotive.

A Toyota spokesman in Japan said, without elaborating, that the automaker was looking to re-route shipments to other ports.

SHANGHAI

Tianjin, regarded as a gateway to China's industrial northeast, handles 40 percent of car imports in the world's biggest auto market. But the explosions are likely to hamper normal operations for at least a couple of months, said IHS.

On Monday, BMW AG (BMWG.DE) said it would re-route shipments to Shanghai, while Volkswagen AG (VOWG_p.DE) opted for both Shanghai and Guangzhou.

Shanghai's sole auto terminal could see a 10 percent rise in car volume based on queries received since the Tianjin blast, said a marketing official at Shanghai Haitong International Automotive Terminal Co Ltd.

The port has an annual capacity of 2 million to 3 million cars, said the official, who declined to be identified. Last year, China imported 1.4 million cars, customs data showed.

"We're only a temporary solution to the difficulties in Tianjin," the official said. "We can't be a substitute for Tianjin. After this, Tianjin will definitely continue to hold on to its dominant position."

 

uk.reuters.com

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