The Worldwide Ripple Effect of Japan's Disaster

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The tsunami has exposed a weakness in global logistics long recognized in principle but disregarded in practice. Lean manufacturing plus heavy reliance on a single plant equals vulnerability to disruption. The Wall Street Journal reports:

Outside of Japan, auto makers can get most of the thousands of parts needed to make cars, but production could still be disrupted if only one of them becomes scarce. Worry is increasing about Japanese firms that make microchips, chemicals and other materials that are used in auto production, or are needed in key components such as controllers that manage how an engine or transmission operates.

GM, France's PSA Peugeot Citroen SA and others have already slowed production because of concerns about a shortage of air flow sensors made by a crippled Hitachi Ltd. plant in Japan. A big supplier of microchips for autos, Renesas Electronics Corp., has also stopped production at several plants.

It's understandable that a Japanese company would have its sole plant for a critical pigment in Japan. But a global German giant like Merck? Nuclear power, seismic activity, and extreme weather are world realities. As the former head of Fukushima Daiichi put it, "We can only work on precedent, and there was no precedent." Now there's a precedent. Will strategies change, or will this just be another anecdote in the decades-old saga of supply chain risk?

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Edward Tenner is a historian of technology and culture. He was a founding advisor of Smithsonian's Lemelson Center and holds a Ph.D in European history. More

Edward Tenner is an independent writer and speaker on the history of technology and the unintended consequences of innovation. He holds a Ph.D. in European history from the University of Chicago and was executive editor for physical science and history at Princeton University Press. A former member of the Harvard Society of Fellows and John Simon Guggenheim fellow, he has been a visiting lecturer at Princeton and has held visiting research positions at the Institute for Advanced Study, Woodrow Wilson International Center for Scholars, and the Princeton Center for Information Technology Policy. He is now an affiliate of the Center for Arts and Cultural Policy of Princeton's Woodrow Wilson School. He was a founding advisor of Smithsonian's Lemelson Center, where he remains a senior research associate.

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