Carmakers face setback over virus fears

Global carmakers look set to suffer a major blow as disruption in China caused by the spread of a deadly virus could drag down an already slowing industry.

Wuhan is one of China’s “motor cities” and home to numerous automotive plants, which in turn employ thousands of people and supply the world’s largest market for cars.

General Motors, Nissan, Renault, Honda and Peugeot owner PSA Group are among several companies that have factories in Wuhan – ground zero of the coronavirus outbreak that has claimed more than 100 lives.

The city of 11 million people is under partial lockdown and all public transport services have been suspended as fear over the outbreak spreads, reports CNN Business. At least 10 cities and almost 30 million people in China's central Hubei district are facing travel restrictions of some sort.

The transport disruptions look set to further dent consumer spending at a time when carmakers are already struggling with falling sales. 

Containing virus priority

GM says it is staying abreast of developments and advising employees who are not feeling well to stay away from work.

“The most important thing is to contain the virus – production is secondary to the health of the team and community,” says Jim Cain, a spokesman for General Motors.

At the same time, some marques are withdrawing employees from China and weighing whether to suspend manufacturing in the country.

Manufacturing in China was temporarily halted in honour of the Lunar New Year, but plans to resume normal operations at the end of January are being reconsidered as the threat of the virus spreading remains.

Honda Motor, PSA Group and Nissan are among companies withdrawing employees working around Wuhan, with Honda confirming 30 “associates and their families” who work at its plant are being sent home to Japan.