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. The car industry is especially exposed as Wuhan – the epicenter of the outbreak – is known as one of China’s ‘Detroits’, accounting for nearly 10% of vehicles made in the country and home to hundreds of parts suppliers, reported Reuters.
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.
Automakers are concerned about their employees’ health and the uneven and unpredictable application of rules in different cities and regions that is making it hard for an industry that is used to uniformity to plan ahead.
“In some cities, one worker gets infected, the whole factory where he works needs to be shut down,” said one official at Honda Motor Co, which has a manufacturing hub and more than 100 suppliers in Wuhan and the surrounding area. “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.”