Production halts at China factories lead to worldwide shortages in components as coronavirus outbreak spreads
- South Korea’s Hyundai Motor became the first global carmaker to halt production outside China because of component shortages caused by stop-works and lockdowns to combat the coronavirus
- General Motors, Volkswagen, Toyota Motor are among companies that have closed their China plants at least through February 9
The global car industry is facing a stress test as the coronavirus outbreak in China disrupts the supply of components from transmissions to steering systems.
Parts manufacturers across China have suspended production through this week and in the case of Hubei province, the outbreak’s epicentre, factories will remain shut until Feb. 13 or later. That leaves car plants at risk both in China – the world’s largest market – and beyond: Hyundai Motor on Tuesday became the first global carmaker to halt production outside China because of component shortages caused by the virus.
A lack of parts adds another major headache for an industry already battling waning demand and rising spending requirements for electric and autonomous vehicles. Carmakers are eliminating more than 80,000 jobs during the coming years, according to data compiled by Bloomberg News, as trade tensions and tariffs raise costs and competition from ride-on-demand services increases.
Wuhan, the capital of Hubei, is one of the top auto-industry hubs in China, together with Shanghai, Guangzhou and Chanchun, where global manufacturers make both cars and components together with partners.
Infographics: Global carmakers and their Chinese venture partners
Hundreds of suppliers have factories in Hubei, including more than half of the Top 20 global parts makers, with Robert Bosch, Valeo and ZF Friedrichshafen among those producing components there, according to China Automotive Technology & Research Centre.
