Conflicting stories are being reported since the terrible earthquake, tsunami and resulting difficulties with nuclear power plants in Japan.  The loss of life and property is terrible.  News has reported the loss of life irreplaceable, the loss of property that took decades to build and the loss of critical electric power crippling basic lifestyles and recovery as beyond belief.

Going beyond the hundreds of thousands without homes and those with injuries, limited food and water; we see an industrialized nation that has been crippled in a different way, one that may be struggling with recovery in its own right.

Many companies enter into business relationships that make since.  Quality products, products delivered in quantity and on time only make sense.  To ensure commitments to large orders and years of mutual satisfaction companies agree to performance stipulations which can include late penalties for products not delivered in a timely manner.  These penalties can extend into the thousands of dollars per minute if a shipment is late with little or no excuse for tardy performance.

Without power to back the machines that manufacturer’s use to automate and build products little can be done to produce at the levels customers demand around the world.  Plants that are without power cannot turn to low power generators and cannot buy large enough generators to produce at the levels needed.  Power that is offered in four hour units is not consistent enough to provide significant production runs.  Some machines need time to heat up and cool down and are not fully operational immediately.  Power loss without warning may strip equipment of cooling capacities to temper products or expel parts from cavities prior to damage to the part or machine. 

Plastic molding processes are a good example with molding presses that require heat to melt the polymers and large motors to turn screws feeding the granules as well as motors to drive the press or support the hydraulics.  Holding times, screw turn rates and cooling all play a part in the quality of the end product and its cost to produce.  Once up and running these machines may run 24 hours a day to create the best economy of scale on startup times.  Small machines of 25 ton holding pressure to those weighing in at hundreds-of-thousands of tons require electric power.  The environment must also be controlled to maintain the quality of the raw and finished goods in storage, as well as the consistency of processing.  Humidity, excess moisture, is a problem for plastic manufacturing and must be eliminated to ensure quality and conformance to size and shape.  Temperature shifts in plastic manufacturing plants can cause variation in machine performance creating under filled or burnt materials if not set to compensate for the prevalent conditions.

From an online US newswire we hear,  

In an article on the front of its business section, “the New York Times (3/18, B1, Bunkley) reports that analysts say this could be the beginning of “widespread disruptions at auto plants in North America.” The company “said it would resume operations there as soon as possible, but gave no estimated date for doing so.” Meanwhile, “a person with direct knowledge of the situation said just one part was involved and” that GM is “diverting parts that would have gone to Shreveport so it can continue building models that are more important or in shorter supply.” (source Custom Briefings nor the Society of Manufacturing Engineers)

From another online news source we hear,

Japan machinery firms escape major damage


Posted March 18, 2011

“TOKYO (March 18, 12:30 p.m. ET) — Japan’s plastics machinery industry, one of the world’s largest, did not appear to suffer major damage in the earthquake and tsunami.

A spokesman for the Tokyo-based Association of Japan Plastics Machinery said there have been no reports of “severe damage” with its member companies, and said the country’s major plastics trade show, the International Plastics Fair Japan, would be held as planned in October. IPF, held every three years, is operated by the AJPM.

As well, a spokesman for injection press maker Nissei Plastic Industrial Co. Ltd. in Nagano said the company’s factory and production were unaffected by the earthquake, although some of its sales offices near the disaster site have been impacted.

An industry source, speaking privately, said the power shortages and planned blackouts hitting parts of Japan could impact production in the machinery industry.”

What is the status, are most companies doing well with 4 nuclear plants down?  Are companies struggling with nowhere to turn?  Can companies internal to Japan accept the shortfall and maintain production as a nation?  Does the world at large need to step up and help out?  If so how can companies already running at 70/80 and 90 percent production levels assume more work on a temporary basis.  Since air flights have been limited smaller molds may not be readily shipped to another location in the world.  Any air transport may have priority demands for more critical needs.  Radiation may also prohibit materials leaving restricted areas.  Shipment of bigger molds could take time and could be very expensive.  Making new molds at distant plant locations for many products may be the fastest solution.

Design requirements could be transmitted in seconds over the internet to partnering plastic manufactures willing to accept the additional load in the short term.  Such relationships would need to protect the interests of companies in Japan while providing end client desperately needed supplies. 

Where short fall penalties seem harsh, the realization that the receiving plant is shut down waiting for source goods and incurring interest payments on debt, overhead costs and loss of profit every minute they are not producing it may be justified compensation for a highly optimized, high production operation with end product turned out on the hour.  Auto manufactures boost finished autos each hour on assembly lines.  The cost of embedded materials and labor repayment are tied to delivery dates already set.  Their profit and loss is based on production performance with no room for delays.

Firms in Japan must either accept the enormous fines levied or partner with companies around the globe, once more demonstrating the shrinking size of the planet and our reliance on others.

Our company is opening its doors to help until these companies can get back on their feet.  We hope others will join us in this endeavor.  Companies seen as competition are also the backbone to international industry and are the infrastructure to a nation going through difficult times; difficult times that can have a ripple effect on the rest of the world.  Where we may not have felt the earth quake or been devastated by the tsunami and the resultant loss of power, many around the world may feel the impact in loss of income, while companies may suffer financial burdens and potential loss of business.  The impact of what happened in Japan is far greater than the immediate images posted in the news.

If you are a quality manufacture that has some reserve processing and are willing to accept production from these troubled firms with a non-compete clause we can:

  1. Eliminate fines due to delays in production for them and downstream companies
  2. Keep their customer’s companies and their employees producing making a living
  3. Allow these companies to make a portion of their revenue until fully operational again
  4. Demonstrate that no matter how big the problem there is a solution when we work together
  5. Where we may be competitors through the rest of the year, we are partners in industry

With efficient production, differences in export/import taxes and appropriate shipping tactics the cost to produce in another nation may be cost effective in the short term.

We are all saddened by the tragedy in Japan and know losses in life and personal pain have not reached their final numbers.  None of us are prepared for such events.  Make a difference and promote your company as one that is willing to cast competition aside for the moment and share our fortune at being safe and sound.  Let them know you are willing to help produce in the short term to save their companies and those they serve; their employees, their customers and customer’s employees someone that just may be a neighbor.