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Coronavirus puts local car industry on alert

Shipping news: A batch of 500 MG ZS EV SUVs line up at Shanghai Haitong Dock late last year, ready for shipment to Europe.

Travel bans in place, production delays a threat, as car industry reacts to crisis

11 Feb 2020

MG MOTOR Australia and New Zealand has placed restrictions on its Australasian-based staff travelling to or from China as local subsidiaries of not only Chinese manufacturers but various other global car-makers study the impact of the coronavirus pandemic on their operations here.


In addition to the welfare of employees, this relates particularly to vehicle supply, and all major Chinese car-makers contacted by GoAuto this week – including MG and Haval/Great Wall Motors – said it was still too early to state what impact, if any, the health crisis might have on vehicle production and supply for this market.


GoAuto understands that Hyundai Motor Co Australia (HMCA) and potentially Kia Motors Australia and Renault Australia could also be facing delayed shipments due to production stoppages at factories in South Korea, which rely on components made in China.


A spokesperson for MG Motor Australia/NZ, which is the local factory operation and a subsidiary of Chinese automotive giant SAIC Motor, said: “At this time, SAIC Motor is focused on ensuring its people are safe and is contributing to the management and recovery efforts throughout China.


“We have placed a temporary hold on any ANZ (Australia/New Zealand) staff travel to or from China while we monitor the situation.”


Haval/Great Wall Motors Australia and New Zealand product planning, digital marketing and public relations manager Edward Mason-Jefferies said the coronavirus outbreak had not yet had an impact on the Australasian operations, but that the company was monitoring the situation closely.


MG affiliate brand LDV, which is distributed through independent importer Ateco Group, was also contacted for comment.


The coronavirus outbreak was first reported in the Chinese city of Wuhan on New Year’s Eve, and as at February 10 the death toll had passed 900 and confirmed cases went beyond 40,000.


Vehicle and parts manufacturing in China have in many cases come to a complete standstill, while factories throughout Asia and in other regions such as Europe are anticipating, if not already experiencing, stock shortages.


Asked whether Hyundai’s Australian supply was impacted by the events in South Korea, HMCA director of marketing Bill Thomas told GoAuto this week: “Hyundai Motor has decided to suspend its production lines from operating at its plants in Korea.


“The decision is due to disruptions in the supply of parts resulting from the coronavirus outbreak in China.


“Schedules for suspension vary by line and the company is reviewing various measures to minimise the disruption of its operations, including seeking alternative suppliers in other regions.”


GoAuto has contacted other local car companies for comment.


According to overseas reports, Fiat Chrysler Automobiles (FCA) is facing a factory shutdown in Italy within a month if supply of parts from China does not start flowing again soon.


Toyota, Honda and Volkswagen have extended the shutdowns of their respective Chinese plants to at least this weekend, Suzuki is understood to be looking outside of China for component supply, and Nissan looks set to temporarily halt production in Japan due to Chinese parts shortages.


Volvo Cars’ entire Chinese operations are reportedly at a standstill, while in the midst of all this Volvo parent Geely announced last week that it would invest 370 million yuan ($A79.2m) to “further the fight against coronavirus” and fund the development of “healthy, intelligent vehicles” that isolate harmful substances and offer high-level cabin air purification to protect occupants.


Geely, which last month set up an initial 200 million yuan ($A42.8m) fund to support coronavirus prevention and control, said its global R&D and design networks based in Europe, the US and China “will jointly move to develop and research new environmentally sustainable materials with anti-bacterial and anti-viral properties which can be used within air-conditioner systems and on frequently touched surfaces such as buttons and handles”.

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