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Wed, May 14, 2008 - Page 10 News List

Global firms suspend work after quake

IMPACT Multinationals operating in Sichuan, including Toyota, Yamaha and Intel, were forced to halt production as they inspected potential damage from the quake


Toyota, Intel, Wal-Mart and other multinationals with operations in China's Sichuan Province have temporarily halted business in the region following Monday's 7.9-magnitude earthquake.

Toyota Motor Corp has suspended production at its Sichuan joint venture until 6am today, as the company assesses the condition of the plant, spokesman Hideaki Honma said.

Japan’s top automaker has confirmed the safety of 1,200 of its 1,600 employees so far, he added.

The Sichuan FAW Toyota Motor Co plant produces Coaster microbus and Prado sport utility vehicles, with an annual production capacity of 13,000. When operating normally, the factory would have produced 80 units during the period of the closure.

Operations were also on hold at other Japanese companies yesterday, including Yamaha Motor Co’s electronics components plant in Chengdu, the capital of Sichuan; Fujitsu Ltd’s semiconductor joint venture in Chengdu would be closed until today.

Japanese Economy Minister Hiroko Ota warned yesterday that the ripple effects of the earthquake, which has killed at least 10,000 people, could hurt Japan.

“The Chinese economy, of course, will be hit first and the effect on the Japanese economy will come after that,” Ota said.

“Because we don’t know the extent of the damage to the Chinese economy yet, it’s hard to tell how much the Japanese economy will be affected,” Ota said.

About 170 Japanese companies have subsidiaries and branch offices in the region.

Intel Corp, the world’s largest chipmaker, on Monday sent workers home at a test-and-assembly plant in Chengdu to inspect possible damage from the earthquake.

The plant, located about 88km from the earthquake, employs 1,600 people, Intel spokesman Chuck Mulloy said on Monday, adding that no one was injured.

The company has facilities in Malaysia, the Philippines, Costa Rica and near Shanghai that perform similar functions, Mulloy said.

No disruption to supply was expected, he said.

Intel disconnected the plant from local water and electricity supplies and plans to begin searching for damage today, Mulloy said.

Wal-Mart Stores Inc and Parkson Retail Group Ltd each closed three stores in areas affected by the earthquake.

Wal-Mart, the world’s largest retailer, said two stores are in Chengdu and one is on the outskirts of the city in Mianyang, Wal-Mart China spokesman Dong Yuguo siad.

Dong said checks would be made to the building structure of those outlets to ensure safety before they would reopen.

There were “minor injuries” after the quake, he said, adding that the company had not quantified any financial losses.

Parkson, operator of the largest department store chain in China, said it shut three stores in Sichuan.

“Our staff are all right, but we’re waiting for the government’s approval to resume opening,” CEO Chew Fook Seng (周福盛) said in an interview in Beijing.

Parkson has three stores in Sichuan, including Chengdu and Mianyang.

Want Want China Holdings Ltd (中國旺旺控股), the country’s largest maker of rice cakes and flavored milk, said in a statement to Hong Kong’s exchange that its seven production plants in Sichuan had not suffered any material damage.

Production at four of the plants in Chengdu city will be temporarily suspended for safety inspections, it said.

The plants are expected to resume operations in one week, and no employees have been injured, the company added.

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