China: Corona virus slows down car industry
STILL STATE The Chinese metropolis of Wuhan is completely sealed off from the outside world because of the epidemic triggered by the Corona virus. This is also having an impact on the automotive industry. The region around Wuhan is the second largest center of Chinese automobile production after Shanghai. Nissan, Kia, PSA and Honda, among others, build vehicles there. After more than 170 deaths caused by the [...]
The region around Wuhan is the second largest center of Chinese automobile production after Shanghai. Nissan, Kia, PSA and Honda, among others, build vehicles there.
Meanwhile, after more than 170 deaths from the new Corona virus, companies are beginning to evacuate their employees.
Enormous loss of production
At present, the impact of the production interruptions cannot yet be predicted. After all, the factories are traditionally closed anyway for the Chinese New Year celebrations.
No one knows at present when production can be resumed. Officials in Beijing have already announced that the Wuhan region will remain under quarantine for "several weeks".
Meanwhile, the epidemic is also affecting other economic regions. In Shanghai, China's largest automotive production center, the New Year vacations have been extended to February 10, which observers calculate will translate into a production loss of around 100,000 cars.
This is how manufacturers act
Volkswagen, in Shanghai for more than four decades, has also extended the vacation and plans to equip its employees with mouth masks and disinfectants when production resumes. In Beijing, VW employees are on leave until Feb. 17 and are expected to work from home during that time.
Toyota, meanwhile, has completely halted production until Feb. 9, when it will decide whether and when to reopen factories. In addition, all business trips to China have been canceled.
BMW and Mercedes-Benz are not currently considering any return trips. Both are foregoing business trips to China that are not absolutely necessary.
No recovery for the market
How the situation will develop also depends on the further spread of the Corona viruses. In any case, the epidemic is hitting the Chinese automotive industry at the worst possible moment.
Last year, new registrations in the world's largest automotive market fell by 8.2 percent. In 2020, the market was supposed to recover. That has now become uncertain in view of the production shortfalls. (ampnet/ww)
