The March 2011 Great Tohoku Earthquake and Tsunami struck the northeast coast of Japan. These natural disasters were exacerbated by additional disruptions from the collateral damage to a seaside nuclear reactor that generated electricity for residential and commercial use in that part of Japan. Concern over leaking radiation caused the government of Japan to evacuate populations from the vicinity of the damaged reactors and to close highways connecting manufacturing and other employment centers. The damage to nuclear facilities also resulted in a shortage of electricity in parts of the country. Subsequent tremors and aftershocks continued to affect precision-oriented manufacturing, which automatically shut down operations when certain moderate-level aftershocks take place. Some ports, which ship product globally, were affected as well. These disasters have thrown into bold relief the vagaries and fragility of some elements of the global auto supply chain. A typical motor vehicle has over 15,000 parts, and the lack of an essential component may halt the completion of vehicles and cause a slowdown or stoppage of assembly lines. Japan is the second-largest vehicle-producing nation (after China), and many of the world's vehicles and vehicle parts originate there. It is also where many automotive technologies originate, giving Japanese suppliers "substantial and growing shares of the global market." A relative handful of critical suppliers, especially of electronic components, were unable to meet their commitments. In some instances, the automakers that depended on them had few alternative sources of important inputs. Full restoration of supply capacity will take months. Not long after the earthquake and tsunami, an industry analyst noted that "[g]iven the disruptions in Japanese industrial activity, the impact on global supply chains could also be significant. This is especially important in industries such as autos, telecommunications and consumer electronics." In the meantime, it is likely that a number of U.S. auto production facilities will see a slowdown of production throughout the spring and summer. Communities in the Midwest and South which have been returning to normal after the recent recession may see a parts shortage-induced drop in production that may affect employment and paychecks. The motor vehicle industry is a major part of the U.S. economy, accounting in 2010 for over 674,000 jobs, or 5.8% of all U.S. manufacturing employment. Although some American manufacturers are adding production abroad, generating concern in Congress and in many states about the future of auto manufacturing in the United States, several automakers are opening new U.S. plants. In 2011, Toyota and Volkswagen (VW) have opened new plants in Mississippi and Tennessee, respectively, and Nissan is building a new plant to open in Tennessee in 2012. Few consumer products are as complex as automobiles: the 15,000 or more parts in each vehicle are integrated at the time of assembly into durable vehicles, most of which will last more than a decade. Vehicles are among the most globally sourced products a consumer can buy. Autos produced in U.S. plants—whether owned by U.S. or foreign automakers—contain parts from not only nearby Canada and Mexico, but also from parts manufacturers in Europe and Asia. Parts are purchased from far away because the supplier base has developed niche markets in some countries. For example, some electronic parts used in U.S.-made automobiles are manufactured primarily in Japan. Since the recession of 2009, when U.S. auto sales and production fell to the lowest points in three decades, automakers have seen a recovery, as shown in Table 1 . Forecasts for 2011 indicate that North American production and U.S. sales may each hit about 13 million units, a level not seen since 2008. The supply chain is the network and related processes which transform raw materials and disparate parts into a finished vehicle. The supply chain also includes financing, advertising, management, and distribution to the final customer. Hundreds of firms are engaged in motor vehicle parts production, final assembly, and sales. The geography of North American automaking is shown in Figure 1 . Assembly plants are located primarily along an axis stretching southwest from Ontario to central Mexico. Thousands of parts suppliers (e.g., Lear, American Axle, BorgWarner) serve the final assemblers (e.g., General Motors, Honda). Under the North American Free Trade Agreement, parts and finished vehicles flow freely among Canada, Mexico, and the United States, without tariffs or other restrictions. In Figure 1 , the parts suppliers are shown by circular dots and the auto assemblers with stars, including the two newest automaking plants: Toyota's Blue Springs, MS, facility and VW's plant in Chattanooga, TN. European and Asian automakers generally prefer to invest in lower-cost, right-to-work states in the South, and have primarily located their plants there during the past 25 years. Most modern assembly plants have "supplier parks" nearby. As foreign automakers established plants in the South, so too did major suppliers, broadening the auto industry's impact on local economies well beyond the traditional Great Lakes region. There are two major reasons for the close proximity of suppliers and automakers. According to a recent study, first, motor vehicles and their main parts, such as seats, engines, transmissions and body panels, are large, heavy and sometimes fragile, which increase transportation costs. Second, the industry-wide implementation of "lean" production techniques and increasing product and module variety since the mid-1980s have kept parts production close to final assembly. Just-in-Time (JIT) parts deliveries that keep working inventories low and reveal defects quickly are an important element of lean production. JIT is a strategy and system of inventory management "in which raw materials and components are delivered from the vendor or supplier immediately before they are needed in the manufacturing process," thereby cutting costs and reducing waste in the production process. Not all parts require close proximity to the assembly operations, however. A recent report by researchers at MIT, Duke, and several other universities found that in the automotive sector, as in other industries, foreign direct investment and global sourcing of parts have increased significantly since the 1980s due to falling trade barriers. The authors also found that supplier firms are taking on more substantial responsibilities and operating globally. It has been estimated that about one-fourth of all auto parts used in the United States are imported from Asia or Europe. This is particularly true of electronics, which are made of light-weight components and can be shipped quickly by air freight from Asia, while still meeting the needs of JIT assembly in normal times. The largest non-U.S. auto parts suppliers are in Japan, Canada, and Mexico. Among Japan's major exports of motor vehicle parts to the United States are tires, seat belts, air bags, bearings, fuel injection modules, exterior lighting (such as headlamps), and semiconductors. It is important to note that the automotive supply chain is not fully global, as most vehicles are built in the regions in which they will be sold. As a result, the motor vehicle supply chain differs in important ways from supply chains for other manufactured products, such as electronics and apparel. Among key differences cited by the MIT/Duke researchers are: Assembly and parts production is regional and near major markets. Whereas a generation ago, those markets were primarily in Europe and the United States, economic growth in Asia has now spawned similar regional manufacturing of autos and parts in Japan, South Korea, southeast Asia, and China. Other consumer goods industries are more likely to be globally integrated, not regionally integrated, which allows their operations to be more concentrated geographically than is the case among automotive suppliers. The concentration of the auto industry in few companies in a few countries (11 lead firms in three countries of Japan, Germany, and the United States) has "blunted the efforts to establish the sort of industry-level technical and business process standards that prevail in less concentrated industries." The authors contend that the small number of very large companies exerts influence over small firms, leading to less standardization that would possibly benefit the small manufacturers. In turn, the absence of industry-wide standards has led to the widespread customization of parts and vehicles. The researchers note that "parts … tend to be specific to particular vehicle models in contrast to memory chips and microprocessors in the electronics industry and fabric and thread in the apparel industry.... Suppliers are often the sole source for specific parts." These unique elements of the auto supply chain have implications for final auto assembly when there are parts disruptions. After the recent earthquake/tsunami and ensuing nuclear events in Japan, the auto parts supply chain, especially with regard to certain electronics, has been disrupted. Understanding the growing role of such electronics in vehicles provides a basis for appreciating the challenge for motor vehicle manufacturers. For most of its hundred-year existence, the internal combustion automobile has run on the principles of mechanics, which have only recently been supplemented with a wide array of mechanisms that use electronic signals to operate certain parts of the car. For example, a car key that operates mechanically turns tumblers in the lock, which opens the door, and it performs a similar mechanical function in the ignition. With most of today's car keys, however, there is both a mechanical and an electronic connection: a semiconductor in the plastic key molding sends a signal to the car's computer, enabling the key to open the door mechanically and then similarly to start the ignition. A key without that chip would be unable to provide those functions, even if it had the correct grooves in the key blade. The computers that control the key and ignition access—and hundreds of other functions in a car—are called microcontrollers. Electronics have been a growing element in auto design and manufacturing since the early 1970s, when the first OPEC oil price hike encouraged automakers to begin thinking about new technology applications. Electronic ignition was one of the first major innovations.