A survey released April 3 by Japanese news agency NNA reveals that 65% of Japanese manufacturers operating in Southeast Asia and India are facing severe supply chain disruptions. The poll, which covered 347 companies, found that procurement and logistics operations have been significantly impacted across the region. The disruptions are not evenly distributed. In the Philippines, 95.8% of Japanese manufacturers reported difficulties.
Indonesia followed at 87.9%, Malaysia at 87.0%, and Thailand at 74.5%. Even Thailand, where many firms have worked to source parts locally, saw three-quarters of companies struggling to obtain necessary materials.
The high local procurement rate in Thailand was supposed to be a buffer, but it was not enough. China has emerged as the primary choke point. The survey identified roughly 140 Japanese manufacturers in India and Southeast Asia that have been directly affected by disruptions in sourcing from China.
When the coronavirus shut down Chinese factories, the ripple effects hit assembly lines from Jakarta to Chennai. Of all the companies reporting problems, more than 80% specifically cited trouble with sourcing parts and materials.
This is the core of the issue—not labor shortages, not consumer demand, but the basic act of getting components from one place to another. Takashi Sugimoto, an economist at the Japan Center for Economic Research, said the pandemic has exposed the vulnerabilities of global supply chains. Japanese manufacturers, he noted, are among the hardest hit.
Japanese firms have long been the backbone of industrial production in the region, from automotive plants in Thailand to electronics factories in Malaysia. When they cannot get parts, production slows.
When production slows, export revenues drop. When export revenues drop, local economies feel the squeeze. The stakes are concrete.
A factory that cannot source a $2 sensor cannot ship a $20,000 car. A supply chain that breaks in one country breaks in all of them.
The NNA survey makes clear that no amount of local procurement has fully insulated these companies. The pandemic did not just disrupt trade routes; it revealed how dependent even the most localized operations remain on cross-border flows of components. Kenji Kawase, chairman of the Japan Chamber of Commerce and Industry, has been watching this unfold.
The survey data backs up what many in the business community have been saying for weeks: the virus has hit the arteries of manufacturing, not just the margins. For the countries hosting these factories, the implications are serious.
Japanese manufacturers are major employers and major taxpayers. If the disruptions persist, companies may be forced to reconsider their supply chain strategies. Some may accelerate moves to shift production out of China. Others may try to deepen local sourcing.
But those are long-term fixes. Right now, the problem is immediate: parts are not arriving, and no one knows when they will.
The survey was conducted by NNA, a Japanese news agency, and released on April 3. It polled 347 Japanese manufacturers operating in Southeast Asia and India. The findings paint a picture of an industrial base under a kind of pressure it has not faced before.
The numbers are raw. The situation is ongoing.
The question hanging over every factory floor is how long they can hold out.
