Car cos say production unaffected by Covid-19 spreads

NEW DELHI: Major automobile manufacturers Maruti Suzuki, Hyundai and Toyota Kirloskar Motor do not see any immediate impact on their production schedules due to disruption in supply of components from plants located in coronavirus-hit China. The companies, however, continue to monitor the situation closely, especially the operations of their major suppliers, in order to face any adverse situation that crops up in the future. "We do not foresee any problem as of now. We will keep in touch with our suppliers and will inform if there is any issue", a Maruti Suzuki India spokesperson told when contacted over the issue. A Hyundai Motor India spokesperson said, "We are closely monitoring the situation. However, at the moment there is no impact on the functioning of the company." Similarly, Toyota Kirloskar Motor (TKM) said there has been no immediate impact so far on supply of parts and its production from the outbreak of coronavirus in China. "Our tier-I and tier-II suppliers are not yet effected. However, we are continuously monitoring the operations of tier-III and tier-IV suppliers to grasp any possible slowdown that may come forth due to the slowdown in logistics flow in China, especially Wuhan," TKM Senior Vice President (Sales and Service) Naveen Soni said. The company focuses on increasing the supply base through localisation of parts and components, thereby providing an opportunity for local suppliers, he added. TKM remains committed to effectively contribute towards government's 'Make in India' mission, and has developed a global supplier base and supply chain in India in a period of 20 years, Soni said. "These localisation efforts have also ensured a smooth transition of our manufacturing plant to 100 per cent BS-VI manufacturing facility from January 2020 without any significant supply roadblocks. Simultaneously, our dependency on multi-sourced parts has allowed us flexibility of sourcing from other countries when China has an impact," he added. Kia Motors India said its production has also remained unaffected so far. "The coronavirus hasn't impacted us till now, but we are keeping an eye on the development for gauging the future impact," a company spokesperson said. MG Motor India, however, reported disruption in supply chain which impacted its production and sales performance in February. "The unforeseen coronavirus outbreak has severely affected our European and Chinese supply chains, disrupting our production and impacting our sales in February and will continue through March," MG Motor India Director Sales Rakesh Sidana said. The company is working towards stabilising the situation and is hopeful that reasonable normalcy will be restored by the end of March, he added. Tata Motors declined to comment on the issue, but its CEO and Managing Director Guenter Butschek had earlier this month said that clarity about supply constraints of components from China will only emerge when workers in the coronavirus-hit country rejoin work. The company imports certain components for both Nexon EV and other traditional models from China. Auto industry body Society of Indian Automobile Manufacturers (SIAM) had earlier said that it will collect information and data from its members to understand if there could be disruptions, and to what extent, if any. Two-wheeler makers Hero MotoCorp and TVS Motor Company had said earlier this month that coronavirus (COVID-19) outbreak in China would hit their production by around 10 per cent in February. Citing disruptions in automotive supply chains due to coronavirus outbreak, rating agency Moody's has already lowered its global auto sales forecast. Similarly, the Association of Indian Forging Industry (AIFI) said that disruption in supplies due to the coronavirus outbreak in China has hit domestic forging industry along with automobile and auto component manufacturing sectors. The domestic automobile industry, which has been riding through the worst slump in two decades, is likely to be negatively impacted and its supply chain disrupted if the coronavirus outbreak in China and South-East Asia persists longer, rating agency Icra had said last week. Around 3,000 people have lost their lives in China due to the disease so far. Cases of coronavirus have also emerged in various other countries, including South Korea, Japan, Iran, Italy and Singapore.

from Economic Times https://ift.tt/2I6OC1N