China's Car Industry Is Starting To Recover From Coronavirus

Mar. 26, 2020 6:55 PM ET by Martin Bigg Industry News / 2 Comments

In the rest of the world, COVID-19 has brought the auto industry to a grinding halt.

Around the world, the coronavirus pandemic has caused the automotive industry to come to a grinding halt. In the US, major automakers including Ford, Fiat Chrysler, General Motors, and Tesla have suspended production for several weeks, while European manufacturers such as Ferrari, Lamborghini, Bentley, and Bentley have also temporarily closed. It's a different story in China, however. After being in lockdown for two months, the city of Wuhan, which is where the outbreak started, will soon be reopening as the spread of the virus slows.

As reported by Bloomberg, car sales in China, the world's largest market, have been badly affected by COVID-19, but the situation is gradually improving. Data collated by the China Passenger Car Association indicates that China's car sales have increased week-on-week since the start of February. Granted, last week's sales were down by 40 percent compared to the same period last year, but it's also a 96 percent improvement from last month.

China's car manufacturing plants are also starting to resume production, providing relief to automakers with high sales volumes in China. BMW's Shenyang plants resumed production on February 17, and most of VW's production sites are now operational.

Fiat Chrysler's manufacturing operations in China have also restarted production now that the spread of the coronavirus has slowed. "The overall manufacturing and commercial operations are gradually resuming business," Fiat Chrysler said. Likewise, Ford's Chinese plants resumed production on February 10 and are continuing to ramp up. Tesla, on the other hand, has made a miraculous recovery. After resuming production on February 10, Tesla's China plant's capacity has increased to 3,000 cars per week, which is even higher than it was before the shutdown.

As for Japanese car manufacturers, Honda's capacity is slowly recovering at its two China plants despite a parts shortage, Nissan's China factories have resumed production, and Toyota's plants in Guangzhou and Changchun have returned to their regular two-shift schedule.

In Tianjin, all production lines have returned to a two-shift schedule, while the Chengdu plant is retaining its usual one-shift schedule. More than 98 percent of Toyota's dealerships are open again, and the Japanese giant's 2020 China sales targets won't be adjusted. Production of the Polestar 2 is already underway in Luqiao, China, and Volvo's four manufacturing plants in China have also reopened. Meanwhile, automakers are closely monitoring how the COVID-19 virus develops before production can resume in other countries.