Wuhan makes cars. That is the odd thing about the city at the centre of the coronavirus outbreak: it is one of China’s “motor cities”, home to plants that feed the world’s largest car market. In late January 2020, with 11 million residents partly locked down and every bus and train service halted, the factories were suddenly part of the story.
GM, Nissan, Renault, Honda and PSA, which owns Peugeot, all run plants in or around Wuhan. At least 10 cities and almost 30 million people in Hubei faced travel restrictions of some kind, CNN Business reported, and the virus had by then killed more than 100 people.
Who is exposed
Take GM. Its facility in Wuhan, run with partners SAIC and Dongfeng Motor Corporation, employs 6,000 people, about 10% of GM’s workforce in China. Renault sold nearly 180,000 vehicles in China the year before, around 5% of its global sales, and builds its Kadjar and Koleos 2 SUVs in Wuhan. Honda’s joint venture there contributed about 11% of group revenue in the year to March 2019 and opened a third plant in April. Nissan has a facility under construction with Wuhan-based Dongfeng.
Factories across China had already stopped for the Lunar New Year, and the holiday was extended to Feb. 2 to keep people home. Several carmakers were weighing whether to stay closed longer. In Shanghai, local officials barred companies from restarting before Feb. 9.
Pulling people out
Honda confirmed it was sending home 30 “associates and their families” who worked at its plant near Wuhan. PSA said it would repatriate its staff in Wuhan in line with the proposals of the French authorities, with flights for French citizens expected by the middle of the week. A person familiar with Nissan’s plans told CNBC the company would withdraw most employees and family members to Japan.
Toyota also restricted travel to China “until further notice”, according to a company spokesman.
The industry was already under strain. “The most important thing is to contain the virus – production is secondary to the health of the team and community,” said Jim Cain, a GM spokesman. The disruption, Autofile noted, looked set to dent consumer spending at a time when carmakers were already coping with falling sales.
Sources
- Autofile – News / Carmakers face setback over virus fears
- Coronavirus prompts automakers to evacuate workers, weigh production delays at Chinese factories
- Honda, Others Evacuate Workers as Coronavirus Takes Its Toll on Industry – TT
- Global Auto Sector Hit Hard By Coronavirus | Global Macro Monitor
