Automakers across the world face the possibility of extended supply chain disrup...
BEIJING - Automakers across the world face the possibility of extended supply chain disruptions as factories in China stutter back to life after closures due to the coronavirus outbreak.
Non-essential factories in Wuhan and other cities in Hubei province remain on lockdown at least until Wednesday. When they reopen on March 11, or whenever authorities give the go-ahead, it is not clear if companies will have the raw materials or workers to get back to normal operations. “In Wuhan, that has not been clarified,” he said. “You don’t know what’s going to happen to your factory until you report an infection case to authorities. It’s hard to live with that kind of uncertainty when you’re running a massive factory.”
Like other manufacturers in Wuhan, automakers and parts suppliers are still dealing with partially blocked roads and health inspections on major transportation arteries, which are creating problems moving around raw materials and finished parts, according to Yohei Shinoda, personnel manager for Kasai Kogyo Co, a Japanese company with four plants in China producing interior door and roof trims for Honda and other automakers.
“The logistics between cities remains an issue, we expect it will take longer for us to get parts from upstream suppliers and send engines to Dongfeng plants in other cities,” an official of the joint venture told Reuters.The corporate damage in Hubei could be significant and long-lasting.
Chinese automakers and parts producers exported $53 billion worth of automotive components to the United States, Europe, Japan, South Korea and elsewhere last year. If plants do not get back up to speed quickly, vehicle assembly lines across the world are at risk of slowing or shutting down.
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