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Quake provides evidence that the just-in-time system works

TOKYO -- Inevitably, some media point to the auto industry’s earthquake-induced paralysis as evidence that Japan’s just-in-time manufacturing system is a flawed model.

Missing a key part can torpedo global production by multiple automakers. So with all of northern Japan hammered, it’s no surprise that assembly plants have come to a standstill.

And that’s the weakness, the theory goes.

In just-in-time manufacturing, stocks of parts are kept to the minimum. That avoids the cost of storing them and the risk of being stuck with unused parts in a sudden downturn. You order what you need, when you need it.

But not having extra parts on hand leaves you vulnerable when the supply chain breaks.

Exhibit A: the dozens of idled assembly plants at virtually every Japanese automaker after the March 11 earthquake that hit the companies’ supplier base.

But that’s looking at the problem from the wrong end.

Instead of showing kinks in the system, the shutdowns show that just-in-time manufacturing works.

If carmakers had been able to fire up their plants immediately after the quake, it should cause pause for thought: Why do they have so many extra parts? And is that really efficient?

The mammoth scale of the Japanese disaster cuts deeply, not just to Tier 1 suppliers, but to suppliers further down the chain making items such as computer chips.

The fact that Tier 1 suppliers also are stymied shows how lean the system is.

No production system is perfect. And no one could engineer a backup plan for the 9.0-magnitude quake. But it shouldn’t spark calls for offshoring production or stockpiling parts.

The efficiencies delivered by just-in-time manufacturing make Japanese carmakers some of the best in the world. And those benefits outweigh the setbacks caused by a once-in-a-century quake.

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