Hyundai, Kia shut down production due to coronavirus
02/06/2020 / By Ethan Huff / Comments
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Hyundai, Kia shut down production due to coronavirus

With Chinese New Year celebrations winding down, companies in China would normally be opening back up for business. Because of novel coronavirus, however, many of them will remain shuttered indefinitely, which means companies in other countries that rely on them for parts and supplies are also having their businesses interrupted or halted.

According to reports, car manufacturers Hyundai and Kia are both feeling the pain as they await parts from China that are currently unavailable. Shifts are having to be canceled and production is slowing or stopping altogether as there simply aren’t enough supplies readily available to complete the manufacturing process.

SsangYong Motor, a car manufacturer based out of China, is also suffering due to coronavirus. The company is reportedly having to close its facility in Pyeongtaek, Gyeonggi, from February 4-12 because its exclusive cable harness supplier in Shandong province is currently out of stock.

These massive disruptions to the global supply chain – China manufacturers most of the world’s goods, after all – was warned about previously when it became clear that coronavirus was spreading largely uncontrolled both in China and abroad.

It’s important to keep in mind that supplies are difficult to replace quickly, especially in the car manufacturing industry which typically relies upon exclusive suppliers that build specialized parts to precise quality and safety standards. They can’t simply be swapped out at a whim, in other words.

“According to our current internal forecast, if the supply issue of some core parts remains unsolved by tomorrow, Hyundai, Kia and other South Korean carmakers’ domestic and overseas plants will have difficulties in operation,” stated an insider to Yicai Global about the ongoing breakdown of the global supply chain.

Mike Adams, the Health Ranger, warned about this type of thing almost a decade ago, by the way. Listen below to The Health Ranger Report to learn more:

The Japanese auto industry is also on the brink as more than 160 companies in China’s Hubei province alone manufacture parts for companies like Honda

The only small bit of good news here, at least as far as South Korea is concerned, is that Wuhan, the epicenter of China’s coronavirus outbreak, is largely a secondary supply hub for South Korea’s auto industry, meaning if the first-line suppliers can’t produce product then Wuhan is next.

However, if things continue in the direction they’re currently going, then primary suppliers will also be affected by these disruptions, which means no more new cars from Kia or Hyundai.

Many Japanese auto manufacturers, including Honda and Toyota, could also be affected, as there are currently 160 companies in the Hubei province alone that supply car parts for these and other Japanese car manufacturers.

Toyota has already announced that it will push back the date for opening back up its Chinajoint venture plant to February 10. Depending on the situation and how it transpires, this date could potentially be pushed back even further.

Many others, including China JVs, Beijing Hyundai Motor, Dongfeng Yueda Kia, and Sichuan Hyundai Motor are all having to do the same thing, with pending opening dates of around February 9 – though, this too is subject to change as the situation evolves.

As of this writing, there are now almost 30,000 confirmed cases of novel coronavirus, and 566 deaths.

Meanwhile, a whole slew of other major corporations are also closing up shop in China, including Walmart, McDonald’s, Starbucks, and Coca-Cola. Domestic auto manufacturers here in the U.S. like Fiat Chrysler, General Motors, Ford Motor Company, and Toyota America are also expected to face supply disruptions as coronavirus continues to ravage the global economy.

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